stung by asian dominance, germany pours cash into ev battery ventures

BERLIN (Reuters)-
Germany has allocated 1 billion euros ($1. 2 billion)
Support a consortium seeking to produce electric vehicle batteries and plan to fund a research facility to develop the next-
Generation solid
Three sources told Reuters the national battery.
The measures, which are expected to be announced next week, are aimed at reducing the dependence of German automakers on Asian electric vehicles (EV)
The battery supplier and the German staff who protect the danger are away from the internal combustion engine.
Berlin\'s efforts to formulate industrial policies marked a breakthrough in its general \"letting go\" approach to business decisions and part of Europe\'s efforts to establish a battery alliance to counter China\'s dominance, companies in Japan and South Korea.
Ensuring local companies participate in the entire electric vehicle supply chain is particularly important for Germany, which is economically dependent on the success of its automotive industry.
But it may be too late for German car battery push.
Asian market leaders are increasing production, and some experts say the risk of oversupply could hinder the establishment of large enterprises.
Mass production of batteries by newcomers to Europe.
The German Chancellor Angela Merkel\'s ruling coalition is also a way to show voters before three elections in eastern Germany next year that it can act together, helping Europe\'s largest economy thrive in the age of electric vehicles.
\"Our risks in the automotive industry are very concentrated.
\"The industry is too dependent on internal combustion engines,\" deputy economic minister Christian Hirte told Reuters . \".
\"The government therefore wants to help diversify the sector.
Hirte said Berlin is in talks with several European companies and other governments to support a battery plant.
\"For example, there is a possibility in the lassiz region that it may cooperate with Poland,\" Hirte said . \" Hirte is the government\'s coordinator for eastern Germany and small businessand medium-
Enterprise scale policy.
\"One thing is clear: you can\'t ignore East Germany if you plan a big project like this.
There is a lot of space here and people are very receptive to it.
Companies involved in negotiations with economic minister Peter Altmaier on the construction of the plant include German battery manufacturer VARTA Microbattery and chemical giant BASF (BASFn. DE)and Ford’s (F. N)
Ford German subsidiary
Werke GmbH, three people familiar with the matter told Reuters.
A spokeswoman for BASF said it would attend a meeting with Altai Maier next week. Varta (VAR1. DE)
Ford declined to comment.
Varta specializes in hearing aid batteries and large solar storage systems.
The company said last month that it was studying the production of large lithium batteries and was conducting intensive discussions with relevant market participants. Volkswagen’s (VOWG_p. DE)
The Board of Supervisors will discuss its strategy for electric vehicles and batteries at a meeting on November. 16.
The German carmaker has said in the past that it is working on battery production at its factory in salzgert.
A source told Reuters on Thursday that the board will discuss
SK Innovation, a Korean battery manufacturer (096770. KS).
Some analysts say Europe has fallen far behind in competition with Asian companies, at least in terms of current technology.
Boston Consulting GroupBCG)
For example, it is estimated that global battery production capacity will exceed demand by about 40% in 2021, putting tremendous pressure on prices and making it difficult for new entrants to make money.
LG chemistry in South Korea (051910. KS)
Electric vehicle batteries made in Poland have been supplied to some German car manufacturers006400. KS)
SK Innovation is planning a factory in Hungary.
The world\'s largest maker of electric vehicle batteries announced
China Contemporary Amperex Technology Co. , Ltd (CATL)(300750. SZ)-
It will build its first European factory in eastern Germany and has reached an agreement with the German carmaker BMW. BMWG. DE)
It was welcomed by the government.
But Ms Merkel told business leaders that Germany is also developing its own battery capacity to ensure the country\'s position in the automotive industry, which is \"extremely important \".
German car owners have been reluctant to drive electric cars for years, but have focused on diesel engines.
But they now face the challenge of how to get the internal combustion engine to comply with the stricter emission rules introduced after the sweeping emissions cheating scandal.
Despite the Boston consulting firm\'s forecast of oversupply, analysts at the consulting firm McKinsey & Company and the Fraunhofer Institute in Germany said there would be room for newcomers to Europe, because when the car manufacturer increases electric power
However, German automakers have warned that jobs could disappear.
Because it takes less time to make electric vehicles, and as overseas markets move to foreign battery manufacturers, this can also happen.
The German VDA automobile industry association said it would ban internal combustion engines.
In 2030, electric vehicles will threaten 436,000 jobs for auto companies and their suppliers.
\"Batteries are a key technology and an important part of the value chain.
That\'s why we want to find this in Germany . \"
Recognizing the importance of the local battery industry for employment and profit, the European Commission has launched its own European battery Union (EBA)
But in 2017, Sweden\'s Northwater was seen as the only major contender so far.
As part of Berlin\'s efforts, Economic Minister Altai Maier is in talks with German and European companies and neighbors to try to join forces.
He is coordinating with Brussels to resolve any state aid and antitrust issues.
\"In a few years, Europe will have a competitive battery industry that can survive without state assistance,\" Altai Maier said after meeting with the EU vice president on September.
Energy Alliance President Maros Sefcovic has been the driving force behind EBA.
Altair is expected to release more details of the battery plan within two years.
A daytime meeting in Berlin on November.
Sefcovic will attend the meeting.
Two people familiar with the matter said the billions of euros designated for the German battery consortium would help build the first plant, possibly in western Germany.
Berlin is also willing to support a second plant, probably in the lassiz area near Germany --
They say two regional elections will be held on the Polish border on 2019.
A spokesman for China\'s Ministry of Economy said that Altai Maier is in talks with all parties concerned and has not yet made any decision.
In addition, the government hopes to spend up to 0. 5 billion euros.
Funding a research plant to help German companies lead in a solid situation
Another source told Reuters that the national battery is ready for the mass market. Lithium-
In a few years, ion batteries are likely to be replaced by solids.
National technology that is expected to produce cheaper batteries with higher energy density.
The location of the research plant has not yet been decided, and the government is about to start the bidding process, where authorities and companies can market the site, the source said.
A spokesman for the Ministry of Science and Technology said the government brought together major research institutions and the private sector to support efforts to develop solid-state batteries.
Companies involved in the network include Varta, BASF, Volkswagen, BMW, automotive parts manufacturer Continental (CONG. DE)
ThyssenKrupp group (TKAG. DE)
Carbon fiber expert SGL carbon (SGCG. DE)
Umicore, Belgian Materials Company (UMI. BR)
\"The spokesman said.
At present, German car manufacturers mainly purchase batteries from Asian suppliers such as CATL, LG Chem and Samsung SDI, although BMW has formed a cooperative relationship with bevoda.
Germany Bosch, one of the world\'s largest auto suppliers, faces tough battlesROBG. UL]
Choose not to produce lithium-
The ion battery is too expensive. Hans-
Martin Henning, an electric vehicle researcher at fraunhove, is less pessimistic.
\"If automakers increase their production of electric vehicles to 10-20% of total sales over the next few years, Europe will need more than 100 giva hours of battery plants,\" he said . \" Far exceeded the planned capacity of Asian producers.
\"We need more batteries in Europe --
It must have happened very quickly, \"Henning said.
Expected transfer to solid
National batteries can also reduce the dependence of European suppliers on China-controlled rare earth resources for lithiumion cells.
\"The situation will change dramatically in the next few years,\" Porsche CEO Oliver Bloom told Reuters . \".
\"There is absolutely a chance in Europe.