Electric Vehicles

Two of the world’s largest electric vehicle battery manufacturers reached a settlement on Sunday that President Biden called “a win for American workers and the American auto industry.”

The companies, SK Innovation and LG Chem, have been involved in a dispute after LG accused SK of misappropriating trade secrets. LG filed a complaint with the U.S. International Trade Commission in 2019 and the commission ruled in favor of LG, putting a 10-year ban on SK imports.

SK agreed to pay $1.8 billion in cash and royalties to LG in the settlement, and both South Korea-based companies agreed to not sue each other for the next 10 years.

The settlement means SK can finish building an EV lithium-ion battery plant in Commerce, Ga., which will provide batteries to Ford and Volkswagen, two contracts it won before the ITC ruling.

The deal came just hours before a deadline in which Biden would have needed to decide to overrule the ITC or to let the ruling stand and potentially lose jobs and resources that would help him reach his electric vehicle goals for the U.S.

Within Biden’s $2 trillion infrastructure plan is $174 billion set aside for increasing EV sales and production.

“We need a strong, diversified and resilient U.S.-based electric vehicle battery supply chain, so we can supply the growing global demand for these vehicles and components – creating good-paying jobs here at home, and laying the groundwork for the jobs of tomorrow,” Biden said in a statement about the announcement.

SK’s Georgia facilities are estimated to provide 2,600 jobs in the area, and both the state’s Democratic senators, Raphael Warnock and Jon Ossoff, and Republican Gov. Brian Kemp were urging Biden to take action to save the factories.

Biden said that Sunday’s settlement “will bring some welcome relief to workers in Georgia and new opportunity for workers across the country.”

U.S. Trade Representative Katherine Tai helped facilitate the settlement and congratulated both companies on the deal, saying it “builds confidence in their reliability and responsibility as suppliers to the U.S. auto industry.”

“After significant engagement with a range of stakeholders, we are in a stronger position to drive innovation and growth of clean energy technology envisioned in the American Jobs Plan while also respecting the rights of technology innovators at the heart of trade and manufacturing policy,” Tai said in a statement.

The CEOs of the two companies released a joint statement saying they “will work to help the development of EV battery industry in South Korea and the U.S. through healthy competition and friendly cooperation.”

Ford Motor Co.’s slick, new electric sleigh, the Mustang Mach-E, can be plugged into a standard electrical outlet like a 4,500-pound toaster. It’s a pragmatic trick, but not much more than that. It takes the machine 10 hours to draw enough juice to travel 30 miles. Anyone riding the silent pony further than the local coffee shop will probably need an upgraded outlet.

Americans will need 26 million new charging outlets installed at their homes and apartment buildings over the next decade, requiring some $39 billion in investments, if the country’s auto industry is going to go entirely electric by 2035, according to a new study by Atlas Public Policy, a Washington D.C.-based research firm. The findings highlight a reality we’re already too familiar with: range anxiety has given way to charge anxiety, as electric-curious drivers no longer wonder how far they can go, but if there will be working, relatively quick options to “fill up” once they arrive. While much has been made about the lack of charge points in rural states, the problem begins and ends at home.

“Convenience is going to be the next big hurdle for electric vehicles, beyond these early adopters who think it’s cool to hang around a charging station for an hour and talk about their vehicles,” said Lucy McKenzie, the lead author of the Atlas study. “And the home-charging challenge is still a significant hurdle.”

Homefront

Americans still have a massive charging gap in their garages and apartment complexes.

Source: Atlas Public Policy

A lot of U.S. homes already have slightly faster charging options — known as “Level 2” in EV-speak — it’s just that they are in the laundry room, powering the washing machine and dryer. Installing one in a private garage costs between $1,000 and $2,500, according to Atlas. For much of the Tesla crowd, that may not be a non-starter, but for the masses stretching to buy a new car, it could be a reason for not ditching gas engines entirely. The added expense could be one reason why General Motors is covering the cost of home chargers for the first wave of people buying its 2022 Bolt electric vehicles.

Ironically, the home-charging hurdle is almost as high as that of public charging, according to the Atlas analysts. To fully flip the switch to electric vehicles, the country will need another $39 billion in infrastructure investments by 2031, enough for 495,000 outlets in public stations and workplaces,  Atlas reckons.

Here though, a tide of government funds may cover a lot of ground. The Biden Administration has proposed $174 billion in spending for electric vehicles; about $15 billion of that is reportedly earmarked for charging stations, 500,000 in all. If the Atlas study proves accurate, the investment won’t be quite enough, but the private sector is sure to cover a lot of new cords as well. Some $4.5 billion in charging commitments have been made by state governments, utilities and Electrify America, the charging network spun out of Volkswagen’s Dieselgate settlement.

Charging in the EV ecosystem is a chicken-and-egg problem. Companies won’t build chargers without electric vehicles; customers won’t buy electric vehicles without chargers. “The charging companies are still really reactive to the market,” McKenzie said. “They’re not in front.” The Atlas study suggests that subsidies are the best way to break that staring contest and Team Biden seems to agree. 

What’s interesting, however, is how all these investment figures are correlated. Any additional federal spending on EV infrastructure is going to embolden charging networks and automakers alike, strengthening the sort of flywheel effect that we’ve seen a little of lately. Indeed, Biden’s infrastructure plan has buoyed for-profit charging companies like ChargePoint Holdings Inc. And every bold EV announcement from Detroit or Silicon Valley seems to spark another elsewhere — the entire hurdy-gurdy market accelerating quickly on that most precious fuel stock: FOMO.

Mahindra & Mahindra Ltd will put in fresh investments to the tune of ₹ 3,000 crore on its electric vehicles business in the next three years, while it looks for more alliances and partnerships in the vertical, according to a top company official.

M&M is working on developing on an EV platform by combining capabilities of its operations across the globe, including Detroit and Italy.

“So, for EVs we are going to invest Rs 3,000 crore additional to what we have talked about,” Mahindra Group Managing Director and CEO Anish Shah told PTI.

Mahindra & Mahindra Ltd had earlier said it was investing ₹ 9,000 crore in auto and farm sectors in the next five years.

The company, which has set a goal of putting 5 lakh electric vehicles on Indian roads by 2025, has already invested ₹ 1,700 crore in the EV business in India with another ₹ 500 crore on a new research and development (R&D) centre.

While it has already opened its electric technologies plant in Bengaluru that produces battery packs, power electronics and motors, it has also invested in a new manufacturing unit at its chakan plant to produce EVs.

Mr. Shah, who recently took over as Managing Director and Chief Executive Officer with the mandate to have a complete oversight of and responsibility for all the Mahindra Group businesses, said the fresh investment “is over and above that”.

It will be utilised on various activities, including developing a new platform that can roll out multiple models, by combining the group’s various capabilities.

“…there are multiple capabilities we have within the group. We have capabilities in Detroit…we have capability in Automobili Pininfarina and our Formula E,” Mr. Shah said adding those are going to combine to get an electric platform for India.

When asked if M&M is looking for alliances or partnerships, he said, “For EVs we will look at alliances. EV is the future.” “We already have one alliance. We have announced an MoU with REE (Automotive) which is an Israeli company. This is for smaller trucks and commercial vehicles. And we will have other alliances in the EV side as well. So we are very open to alliances but it is more for the future,” Mr. Shah said.

On whether the future alliances would be technology or equity partnerships, he said, “We are open to all sorts of possibilities at this stage but at this point it is too early to say because we will have to have a lot of conversations. Once we do that we will have a better sense.” Bullish on the EV market in India he said for the last mile, which is three-wheelers and small four-wheelers for passengers and load, cost of ownership is now the same as that of conventional vehicles with charging not an issue due to swappable batteries. “So that segment, we see taking off in the short term. In the next two or three years, it should become a very significant part,” Mr. Shah said.

However, he said, “For four-wheelers it is going to take long… Infrastructure is not going to come in until the cost of ownership is equal. A lot of things have to work together but we see a three to five years horizon for that to happen.”

DES MOINES, Iowa — The president and auto industry maintain the nation is on the cusp of a gigantic shift to electric vehicles and away from liquid-fueled cars, but biofuels producers and some of their supporters in Congress aren’t buying it. They argue that now is the time to increase sales of ethanol and biodiesel, not abandon them.

To help address climate change, President Joe Biden has proposed an infrastructure plan that includes billions of dollars to pay for 500,000 electric vehicle charging stations, electrify public vehicles and enhance the nation’s power grid. These moves follow initiatives in California and other states to mandate electric vehicle sales and a goal by General Motors to shift production fully to electric vehicles by 2035.

Yet any shift from liquid-fueled cars to electric would be gradual, given the fleet of 279 million petroleum-powered vehicles now on U.S. roads. And producers of corn-based ethanol and soy-based biodiesel argue that biofuels will be needed for the foreseeable future.

The government’s promotion of electric vehicles comes as the U.S. works to reduce carbon emissions that worsen climate change and to compete in the increasingly electric global auto market. The transportation sector accounts for the largest share of U.S. greenhouse gas emissions, and more than 80% of that comes from cars, pickups and larger trucks, according to the Environmental Protection Agency.

LMC Automotive, a consulting firm, predicts more than 1 million electric vehicles will be sold in the U.S. in 2023, rising to over 4 million by 2030 — still less than one-quarter of normal annual new vehicle sales of around 17 million. Electric vehicles now comprise less than 2% of U.S. new-vehicle sales.

Citing a recent study from Harvard and Tuft universities that found ethanol emits 46% less carbon than gasoline, biofuels advocates say it’s imperative for the climate that the nation prioritize increased biofuel production.

Geoff Cooper, who heads the St. Louis-based Renewable Fuels Association, calls ethanol the “low-hanging fruit” for reducing carbon emissions and slowing global warming. He supports an immediate move from gasoline blended with 10% ethanol to a blend of 15%.

“If the goal is to reduce carbon impacts of our transportation sector and we knew we’re going to be using hundreds of billions of gallons of liquid fuels for the next several decades, why not take steps now to reduce the carbon intensity of those liquid fuels?” Cooper said.

Each year, U.S. refineries produce about 15 billion gallons of ethanol — about 10% the volume of gasoline — and 1.5 billion gallons of biodiesel, which is typically blended with petroleum-based diesel for trucks and other heavy vehicles.

Plants around the country produce the fuel, but most are in the Midwest, led by Iowa with 43 ethanol refineries and 11 biodiesel plants. Nearly 40% of the U.S. corn crop is used for ethanol, and 30% of soybeans goes to biodiesel.

Despite the carbon benefits of ethanol, others note the growth of biofuels prompted an expansion of corn acreage, increased use of fertilizers and more pollution of waterways. Biofuels plants also typically use hundreds of millions of gallons of water annually.

Iowa’s two Republican U.S. senators consider the shift toward electric vehicles a threat to farmers.

Sen. Charles Grassley said last fall that a proposal by Democratic Sen. Jeff Merkley of Oregon and Rep. Mike Levin of California to end U.S. sales of gas-powered vehicles by 2035 would devastate Iowa.

“This … would absolutely destroy Iowa’s economy because it’s so dependent on agriculture and agriculture is so dependent on biofuels,” Grassley said.

Iowa Sen. Joni Ernst argues that tax credits for buying electric cars typically go to well-to-do people on the East and West coasts and are propping up an industry that hurts demand for biofuels.

“It’s not only the move to all-electric vehicles that should have Iowans concerned; it’s the crazy tax breaks that wealthy coastal elites are getting for their electric vehicles,” Ernst states on her Senate website. “I firmly believe Iowa taxpayers shouldn’t be footing the bill for millionaires to get a discount on luxury cars.”

It is true that many who got the $7,500 federal electric vehicle tax credit since its inception in 2009 could afford a car that cost six figures or more. But since then, new models and higher sales have brought economies of scale and lower prices that appeal to more mainstream buyers.

The ethanol industry itself was a beneficiary of a 45-cent-per-gallon tax credit that provided about $30 billion to help the industry get established before that expired a decade ago. And farmers who grow commodity crops, such as corn and soybeans, still receive help from the federal government, including subsidized crop insurance costing billions of dollars annually.

Despite assurances the move to electric will be gradual, many farmers see the shift as a threat to their livelihoods and doubt state and federal officials from urban areas will protect rural economies.

“It’s like you’re almost helpless,” said Ed Wiederstein, a semi-retired livestock and grain farmer near Audubon in western Iowa. “It’s like a snowball that goes downhill.”

Joel Levin, executive director of the nonprofit advocacy group Plug In America, said the market will favor electric cars not only for environmental reasons but also because they’re high performance.

“It’s not like Californians wants you to eat your broccoli. These cars are fun to drive,” Levin said. “People don’t drive Teslas just because it’s good for the environment. They drive Teslas because it’s a sick car.”

Over time, a switch to electric vehicles likely will force farmers to adapt, said Chad Hart, an agriculture economist at Iowa State University. Farmers in states such as Iowa and Illinois still will mainly grow corn and soybeans because the soil and climate are perfect, but farmers elsewhere will raise other crops, he said.

“Agriculture is always shifting the crop mix to fit whatever markets offer the best opportunity,” he said.

— Information for this article was contributed by Tom Krisher of the Associated Press.

Follow Scott McFetridge on Twitter: https://twitter.com/smcfetridge

Two big South Korean electric vehicle battery makers have settled a long-running trade dispute that will allow one of them to move ahead with plans to make batteries in Georgia, a person briefed on the matter says.

LG Energy Solution and SK Innovation reached the settlement, ending the need for President Joe Biden to intervene in the dispute, the person said Saturday. The person asked not to be identified because the companies have not yet announced the settlement. No details were available.

The U.S. International Trade Commission decided in February that SK stole 22 trade secrets from LG Energy, and that SK should be barred from importing, making or selling batteries in the United States for 10 years.

The decision could have left Ford and Volkswagen scrambling for batteries as they both roll out additional electric vehicle models. SK has contracts to make batteries for an electric Ford F-150 pickup truck and an electric Volkswagen SUV.

The commission said SK could supply batteries to Ford Motor Co. for four years and to Volkswagen AG for two years.

The decision jeopardized a $2.6 billion battery factory that SK is building in Commerce, Georgia.

Politicians were calling on Biden to overrule the commission’s decision. Biden had until Sunday night to make a decision.

Two electric vehicle groups held demonstrations on Saturday against the provincial government’s proposed $150 tax on the vehicles. 

The tax was announced as part of the province’s 2021-22 budget, released on Tuesday. Finance Minister Donna Harpauer said Saskatchewan is the first province in Canada to implement a tax on electric vehicles. 

The proposed tax would start on Oct. 1, 2021. That has vehicle owners upset about the timing and reasoning. 

The SaskEV Society held a rally in Saskatoon and the Tesla Owners of Saskatchewan held a demonstration in Regina, both on Saturday afternoon. In Saskatoon, vehicle owners drove through downtown Saskatoon to bring attention to electric vehicles in the province. 
 
SaskEv Society president Jason Cruickshank said the tax was disappointing, as the province currently only has about 400 electric vehicles, compared to 50,000 in British Columbia. 
 
“It’s really the wrong time and it’s really too early for us to be looking at some kind of tax on vehicles in this province, especially when our fast-charging network is still so limited,” Cruickshank said. 

Cruickshank said his group hopes to see more fast-charging infrastructure — stations where cars can fully charge in 30 minutes — over the next couple of years, but that’s only available along Highway 1 in the province for now.

He said a lack of incentives has also kept the province behind others. 

“I think a lot of people are seeing how petty this tax is,” Cruickshank said. “So hopefully, as we sort of draw attention to the electric vehicles that are on our roads in this province, people kind of think about the fact that this is really sending the wrong message.”

The tax has been compared to a similar one in California. However, Cruickshank said the University of California found the fee there could reduce sales by 10 to 24 per cent, and California has incentives that balance the tax. 

Electric vehicles are “an important tool for dealing with climate action,” Cruickshank said. “There’s also benefits as far as air pollution and air quality benefits for electric vehicles.”

Joel Murray, the vice-president of the Regina Tesla Owners club, came out to the Saskatchewan Legislature on Saturday. He said the hope was to show how many EVs there actually are in the city and show the group’s concerns about the tax. 

“It’s quite a regressive sort of holding back progress to a green transition,” Murray said. “When you look at the market share, now’s not the time to start taxing … an industry that’s just getting started.” 

The provincial government has said the tax is needed because electric vehicles contribute to wear and tear on provincial roadways, but they don’t contribute to highway maintenance funding through the provincial fuel tax.

Electric vehicles make up under one per cent of those on the roads in the province, Murray said. He also said electric vehicles are typically mainly used in urban centres, as there aren’t a lot of fast-charging stations along highways.

“The majority of that money that the provincial government takes, they don’t share that with municipalities through revenue sharing, that’s designed specifically for provincial highways,” Murray said.

“So the money that they’re talking about actually won’t be going to where most EVs are driving or even can drive,” he said. “We would be absolutely willing to pay the fee if they were going to install electric vehicle infrastructure on provincial highways so that we could travel.” 

Murray said he hopes to see more fast-charging stations along highways as people realize how far electric car technology has come. He said he hopes to simply open a dialogue with the province for consultation before taxation. 

“At a time when it’s just starting out, we don’t want to see it get slowed down at all.”