Europe automotive industry is missing out on billions in profits – Dependence on Asian battery producers is increasing.
- Without their own battery value chain, European companies miss out on around 10.5 billion euros in profit.
- 77 percent of batteries for electric vehicles are manufactured in Asia – an increase of 7 percent compared to 2024.
- Investments and funding must be provided in a targeted manner so that European companies can survive the critical start-up phase of battery cell production.
Munich, August 3, 2026 – Europe’s dependence, particularly on Chinese battery manufacturers, is increasing significantly, albeit at a high level. According to a recent analysis by Deloitte, 77 percent of battery cells for electric vehicles were manufactured in Asia last year (2024: 70%), while Europe’s share remained unchanged at 13 percent. Furthermore, 98 percent of European production capacity is controlled by Asian companies (2024: 97%). Overall, global production capacity increased by 26 percent within a year to 920 gigawatt-hours.
Demand for electric vehicle batteries will continue to rise: According to analyses by Deloitte, nearly 28 million electric vehicles will be produced in Europe by 2030. These will require batteries with a capacity of 1,950 gigawatt-hours. Local battery companies will miss out on €10.5 billion in profits over the next four years if they do not produce these batteries themselves. If one includes imported intermediate products, production facilities, and skilled workers sent from Asia, on whom the European battery industry depends, the lost added value could amount to between €100 and €150 billion by 2030.
This is shown in a recent study by Deloitte. Based on production analyses and a survey of 222 decision-makers in 13 European countries, the study examines the competitiveness of European companies along the battery value chain. A total of approximately 350 European industrial companies operate within this ecosystem.
Battery dependency exacerbates sales crisis
Harald Proff, head of the global automotive sector at Deloitte, says:
Batteries determine the range, performance, and price of an electric car,
“If European manufacturers are not competitive in this area, sales will come under even greater pressure in the future. The industry and policymakers must now work together to counteract this trend and reduce dependence, particularly on China.”
The added value of batteries arises primarily from material extraction and processing (50 to 60% of added value) and cell production (15 to 30%). These processes significantly determine the profitability and stability of downstream processes. However, European battery companies are currently underpositioned in these areas: For 83 percent of the companies surveyed, the production of cell components is a key challenge, followed by material extraction and processing (82%).
In particular, 57 percent of respondents cited problems with the supply of precursor materials as the biggest hurdle. This was followed by difficulties in commissioning the plants (51%) and a lack of experience (48%). Furthermore, 41 percent see a risk that Europe will not be able to meet its own battery needs in the future.
European companies still have a chance to win
Proff, explains:
Manufacturers are researching new battery technologies, but the problems lie in financing and industrialization,
“Investments and subsidies should cover not only the development phase, but also the first capital-intensive years of operation. Battery production is a long-term gamble that European companies can still win. For these investments, the industry needs long-term planning security and a clear commitment to electromobility. Europe can no longer afford to operate on a short-term basis when it comes to batteries.”
The survey shows that in the past three years, only 40 percent of projects along the battery value chain were fully implemented as planned. Eighty percent of respondents say that current regulations have a negative impact on battery projects. Accelerated approval processes (70%), stable demand (54%), and the consistent implementation of a clean-tech roadmap (51%) would be helpful.
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Europe automotive industry is missing out on billions in profits – Dependence on Asian battery producers is increasing., source
