Deloitte: Europe risks deepening EV battery reliance on China

Europe's reliance on Chinese-made batteries for electric vehicles (EVs) is putting both supply security and technological sovereignty at risk, consultancy Deloitte said ahead of the Munich auto show.

Only 13% of global EV batteries were produced in Europe in 2024, Deloitte estimated. Almost all of these were made at subsidiaries of Chinese and South Korean firms, with just one EU-based manufacturer producing on a limited scale. About 70% of global EV battery output came from China, it said.

Deloitte expects EV battery revenues in Europe to rise from €16 billion ($18.6 billion) in 2024 to €54 billion by 2030. Without rapid expansion of local production, the growth of the EV market risked cementing dependence on Chinese and other Asian suppliers, the firm said.

The consultancy argued Europe would need at least a 40% global market share in EV battery production to play a meaningful role. Batteries, it noted, are the most expensive EV component, determining cost, performance and driving range.

Deloitte warned that Asia's dominance amounted to a "regional monopolization" of the market, raising the risk that European carmakers could lose access to the most advanced technologies.

It also highlighted delays or cancellations of European battery factory projects, including the collapse of Sweden's Northvolt venture in northern Germany.