**London**: The rise in electric battery demand prompts strategic recommendations from SAP’s Sebastian Scharfenberger, focusing on sustainable practices and industry collaboration to tackle supply chain bottlenecks and the geopolitical risks associated with reliance on dominant players like China.
In a rapidly evolving landscape of electric battery demand, Sebastian Scharfenberger, the Global Battery Practice Lead at SAP, has proposed a comprehensive strategy aimed at addressing the anticipated supply bottleneck by advocating for sustainable practices and collaborative efforts within the industry. The focus on this topic stems from the increasing need for raw materials such as lithium, cobalt, and graphite, as industries pivot towards electric vehicles (EVs) and renewable energy solutions.
The global battery market is projected to grow by 30% annually from 2022 to 2030, a trend underscored by a recent analysis from the Carnegie Endowment for International Peace, highlighting China’s dominant role in this arena. The report indicates that China accounts for 70-90% of critical battery supply chains, including mineral extraction, battery cell production, and manufacturing. With Chinese firms managing not only domestic refining but also overseas mining interests, this dominance has raised concerns about the associated geopolitical risks. In March 2025, the Swedish battery component manufacturer Northvolt filed for bankruptcy, citing geopolitical instability and supply chain disruptions that undermined its operations and highlighted the vulnerabilities inherent in the current supply chain.
To navigate these challenges, Scharfenberger’s plan is built around enhancing circular processes that promote the reuse and recycling of battery materials. Specifically, he identifies four key strategies to address the battery supply issue. The first involves a commitment to circular products and business models. Noting the initiative by Volkswagen Group, which plans to commence battery cell production through its subsidiary PowerCo in 2025, Scharfenberger points out the importance of developing models that facilitate the recycling and reuse of battery components.
Secondly, he advocates for intensified efforts in developing next-generation batteries. The limitations of traditional lithium-ion batteries have driven research towards alternatives like solid-state batteries and lithium-iron-phosphate batteries that promise improved energy density and reduced reliance on scarce raw materials. Toyota has indicated that these emerging technologies could potentially simplify recycling processes and enhance battery longevity.
The third strategy proposed is the implementation of a digital battery passport. Scheduled for introduction in the EU in 2027, this passport aims to provide essential information on each battery, including specifications, sourcing transparency, and recycling instructions. By establishing a comprehensive record of a battery’s lifecycle, the passport will serve various stakeholders—consumers, regulators, and industry players—ensuring accountability and supporting circularity.
Lastly, Scharfenberger stresses the importance of collaboration across the industry. To successfully transition away from linear production models, information sharing and co-innovation among automakers, battery manufacturers, and recycling firms will be essential. Existing initiatives, such as the Global Battery Alliance and the Battery Pass, already signify a move towards creating interconnected ecosystems that can bolster sustainability efforts.
Scharfenberger’s insights reflect a multifaceted approach to tackling the impending battery demand crisis while simultaneously ensuring ethical, sustainable, and economically viable practices. The collaborative frameworks and innovative technological solutions proposed may indeed reshape the future of the automotive industry as it transitions towards a more decarbonised and circular economy.
Source: Noah Wire Services
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