| 12:36 AM EST

EU Pushes Regional Battery Consortium

The European Union will convene a meeting on Oct. 11 to encourage the region’s top automotive and tech companies to form an Airbus-like consortium to develop battery systems for electric cars.
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The European Union will convene a meeting on Oct. 11 to encourage the region’s top automotive and tech companies to form an Airbus-like consortium to develop battery systems for electric cars.

The EU indicates it will provide as much as €2.2 billion ($2.6 billion) to help fund the cooperative effort, the Financial Times reports. The scheme aims to make Europe more competitive with battery tech in China and the U.S.

FT says expected next week’s attendees will include BMW, Mercedes-Benz, Renault, BASF, Northvolt, Solvay, Saft , Siemens and Terra E.

The initiative comes as European carmakers sharply accelerate a shift from diesels to electrified powertrains needed to meet EU emission limits that will take effect in 2021. Those rules will require manufacturers to lower the average carbon dioxide emissions of their new cars to 95 grams per kilometer from about 120 g/km last year.

Worldwide demand for lithium-ion batteries is likely to balloon to $40 billion by 2025 as other carmakers make similar shifts to electrification, Goldman Sachs estimates. Volkswagen AG has estimated that by 2025 it alone will require 150 gigawatt-hours of battery capacity for the electrified models it expects to be building by then.

China, Japan and the U.S. are building factories to make cells used to create batteries. FT notes that several carmakers plan to erect battery assembly plants, but those facilities will buy most of their cells from Asian suppliers.

Maros Sefcovic, who heads the European Commission’s energy office, tells FT it’s critical that Europe commit now to become a player in “such an important industry.”

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