UK’s electrification charge signals massive re-shoring opportunity reveals new report
Digital manufacturing specialist Protolabs’ ‘In Charge’ survey of European battery industry chiefs reveals 84 percent of UK companies are looking to bring parts of their supply chain closer to their manufacturing base over the next year. The desire to localise supply chains has never been greater following the economic global disruption caused by the pandemic, with firms looking to increase security of supply and speed to market, along with reducing their carbon footprint.
Most UK respondents are also looking to outsource component production to specialist manufacturers, while 86 percent are planning on launching a new battery product or storage system during the next 12 months.
The findings coincide with Nissan’s plans to build the UK’s first car battery gigafactory, potentially creating further opportunities for domestic suppliers worth billions and leading to thousands of new jobs.
“With just six percent of battery manufacturing taking place in Europe, we are still heavily reliant on battery cell imports and, with demand for electric vehicles increasing rapidly, there is an understanding this has to change,” declares Bjoern Klaas, managing director of Protolabs Europe.
“The UK’s appetite to be at the forefront of the electrification race is clearly evident, but increasingly pleasing is the determination to create stronger domestic supply chains that can support battery development and production.”
In addition to the growing reshoring trend, the Protolabs’ survey’s respondents highlighted sustainability as the UK’s main differentiator when looking to challenge battery development and manufacture in the Far East and other international territories.
Sixty eight percent of executives believe their businesses will gain competitive advantage by increasing their environmental capability, and prove crucial when attracting inward investment.
Klass added: “Sustainability means the entire value chain… raw materials, supply chain, manufacturing and recycling – they will all need to comply with strict environmental, social and corporate governance (ESG) criteria.
“The UK is well placed to achieve this when compared with other nations, but there is still work do.”
Concerns continue over the sourcing of responsible raw material practices and renewable energy for production.
“There are also some warning signs for the government to consider in our findings,” warned Klass. “Primarily that over half of executives feel they are over-incentivising hydrogen projects at the expense of battery storage technology.
“Companies are also calling on Whitehall to increase spending, so the UK can overcome uncertainty about returns on investment and policy direction – two of the biggest potential risks to the domestic battery sector.”
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