Tag Performance Metrics

• Battery technology is progressing slowly and advances in lithium-metal are not yet commercially available
• Federal EV battery incentives pertain to countries with US free trade agreements: Australia, Canada, and Chile
• Battery supply is constrained by metal mining and production is limited by complex and costly process technologies
• More research and product production methods are imminently needed

Battery production for electric vehicles should be a concern. For one, the US has neither the resources nor the production capacity to meet the demand of EV manufacturers. Second, as a national security concern, not having the requisite production infrastructure to support energy transformation leaves the US vulnerable to economic decline and energy price increases. Third, to navigate energy transformation it’s imperative to establish battery production for grid stability and resiliency, particularly when introducing renewable energies.

Currently, lithium-ion batteries are the core foundation for EVs and most vehicle manufacturers are planning to transition to all elective vehicles in the near future. California might ban the sale of new cars running only on gasoline by 2035. The issue is the production of EVs is inextricably linked to the availability of batteries that are limited by supply constraints in both battery metals and production capacity. Our focus is on battery supply chains and production.

Battery Supply Chains

The big issue around EV batteries is assuring an adequate supply of materials at a reasonable price.  To better understand the EV supply chain let’s look at the common raw materials namely metals and their associated costs. The four primary metals in a lithium-ion battery commonly used in most EVs are lithium, nickel, cobalt, and manganese. EV batteries use nickel-manganese-cobalt cathodes, with 60% nickel and 20% of cobalt and manganese.

The Possible Achilles’ Heel of EVs and Energy Storage – MarketScale

Technology and innovation drive productivity, but transaction costs arising from technology implementation limit gains. Analytics and decision science could provide the means to tame transaction costs and improve productivity. Transaction costs were defined by Ronald Coase in “The Nature of the Firm,” published in 1937 and who earned a Nobel Memorial Prize in Economics in 1991.

Access to and sharing of information drives competitive advantage. Businesses often require global sourcing of physical and digital resources and collaborative workgroups often span several nations across the globe. Information flow is an integral aspect of collaborative workflows and global supply chains. Data serves as the foundation for business models where competencies are achieved through analytics. To achieve visibility and granularity into business processes, greater amounts of data are generated.

By reducing transaction costs, advances in technology and innovation can translate into higher productivity; lower operating costs, and a greater supply curve shift. At the same time, the network effect, enhanced consumer utility found with increasing number of users, may push demand.

The takeaways are: 1) analytics provide a process to reduce costs and improve productivity; 2) a process to monitor, measure, and benchmark performance; and 3) enable a firm to assimilate new technologies and manage uncertanties.
How Analytics can Improve Productivity