EV Batteries

Here’s how the US battery industry evolved in 2022

North American battery production could grow tenfold by 2030.
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Illustration: Dianna “Mick” McDougall; Photo: Getty Images

· 6 min read

It’s been a historic year for electrification in the auto industry, but nestled within most stories or conversations about the rapid advance of EVs is a caveat: We’re going to need a lot more batteries.

While accelerating installations of renewables are also driving the battery boom, the auto industry was the key force in 2022, as demand for EVs began to outstrip supply and governments further formalized both sticks (state bans on gas-powered vehicles) and carrots (subsidies) for EVs. For automakers, obtaining more batteries is now a task as important as building a motor—it’s fundamental to manufacturing cars. In the US, EVs are projected to account for 52% of new car sales by 2030, per BNEF, a staggering increase from just 8% today.

Let’s take a look back at how the US battery industry evolved in 2022 to try and keep pace with this rapid change.

Growing capacity

Along with a push to bring more battery assembly to the US and its neighbors, automakers are looking to increase production capacity in anticipation of a battery shortage that some execs have said could cause longer-lasting problems than the semiconductor shortage.

“There’s plenty of demand in North America,” Shoichiro Watanabe, CTO of Panasonic Energy, told Bloomberg in November.

As a result, North America’s capacity for battery cell production could grow more than tenfold, from less than 60 GWh in 2021 to more than 700 GWh by 2030, per Wood Mackenzie estimates.

The momentum kicked off in late 2021 with $7 billion in funding for battery manufacturing in the Bipartisan Infrastructure Law, James Frith, a principal at Volta Energy Technologies, told Emerging Tech Brew, and only picked up more steam in 2022.

“Now, with the promised support from the IRA plus the announcements of that first round of infrastructure bill funding, I think that it’s just kind of incredible what we’re seeing happening in the US and the knock-on effects, particularly when you kind of tie that up with the activity in Canada. You can really see this battery superhub growing,” he said.

This year, four of the world’s five largest battery makers moved to set up shop in North America. CATL, Panasonic, LG Energy Solutions, and SK all announced plans for production in the US, Mexico, and Canada—investments totaling tens of billions of dollars. BYD, which rounds out the top five, is also considering building a battery plant stateside.

Some of these facilities, like the Stellantis-LG plant in Canada and the Hyundai-SK plant in Georgia, are joint ventures between automakers and battery makers. But others are standalone gigafactories that aim to manufacture batteries for multiple third parties.

Cost > performance

The steady decline in lithium-ion battery prices over the last decade reversed direction in 2022.

“That’s obviously the big issue in the room, which everyone’s having to contend with, and I think is what could potentially create the most difficulties over the next two or three years for the industry as a whole,” Frith said.

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Soaring battery materials prices have found automakers and other battery-dependent businesses working to innovate around affordability rather than focusing primarily on efficiency, experts told us.

“I think a lot of companies are looking, and very desperate to look, for ways to drive down cost if possible, or build technologies that will be better at the same cost,” Nicholas Yiu, chief of staff at About:Energy and co-founder of Intercalation Station, told us.

This year, following the success of CATL and BYD, automakers from Tesla to Rivian to Ford have begun using the less expensive, previously overlooked lithium iron phosphate (LFP) cells in some vehicles.

Many OEMs now see this chemistry as “good enough,” Yiu said, after years of focusing on nickel-rich chemistries that deliver higher performance.

“When I speak to a lot of companies who use batteries, I’m just like, ‘What are you looking for in your battery?’ And they’re like, ‘Yes, ideally, it would be smaller, it would be lighter, it would be better. But the reality is, I’m building a business today, and I want to know exactly what I can buy today,’” he said.

Even if the prices of battery materials “were to come down tomorrow,” making LFP work would still be an advantage for EV makers, Frith said, due to the flexibility it offers around supply-chain issues.


Along with the race to secure battery materials, OEMs are facing questions from regulators, consumers, and investors about ensuring that their EV processes are responsible and sustainable, from mining to a battery’s end of life.

For example, some automakers are partnering with recycling companies in order to establish a circular battery ecosystem as EV production grows.

This year, GM invested in Canadian startup Lithion Recycling and is partnering with the company to potentially use recycled materials to manufacture the automaker’s batteries. Redwood Materials, which already has partnerships with Ford, Toyota, Volkswagen, Audi, and Volvo, announced that it plans to spend $3.5 billion building out production capacity in Nevada. In May, the Biden administration also announced a $60 million program for battery recycling specifically.

But beyond battery recycling, EV makers are increasingly considering the potential broader environmental impacts of everything from mining to manufacturing, as regulators, consumers, and ESG investors urge them to take responsibility across their supply chains, Sarah Montgomery, CEO of Infyos, told us.

Montgomery co-founded Infyos, a startup that works with companies in the battery space to measure, track, and improve sustainability across their supply chains, in 2021.

She said EV makers are moving to quickly build in-house expertise around measuring and improving sustainability and should take a more holistic view of sustainability if they’re looking to achieve long-term success.

“There’s a huge shift toward them really trying to understand that and improve what's going on in their supply chain. And from a supply-chain perspective, the reality is that they hold a lot of the power dynamics drive change in the supply chain,” she said.

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Tech Brew keeps business leaders up-to-date on the latest innovations, automation advances, policy shifts, and more, so they can make informed decisions about tech.