Recently, the Fraunhofer Battery Production Research Institute (Fraunhofer FFB) in Germany and researchers from the University of M ü nster jointly released an in-depth study that analyzes in detail the ownership structure and geopolitical dependencies of the electric vehicle battery supply chain. The research results show that China occupies a dominant position in the entire value chain of lithium-ion batteries, from raw material extraction to battery production, almost fully controlling it. This phenomenon has sparked widespread attention in Europe towards supply chain security and autonomy.
Lithium, cobalt, nickel, and manganese are essential key raw materials in battery production. Taking Tesla's Model S Plaid model as an example, its battery pack contains approximately 122 kilograms of mineral raw materials. However, these resources are mainly concentrated in a few countries such as China, Australia, and the Democratic Republic of Congo. Professor Dr. rer. nat. Simon Lux, Director of the Fraunhofer FFB Institute in Germany, pointed out that "mineral raw materials are located in the initial stage of the battery pack production supply chain, and Europe relies almost 100% on imports
Lithium Battery Value Chain - Everywhere in China
Further research reveals that China not only controls domestic production facilities, but also controls overseas mines, refineries, and production bases through acquisitions and investments, covering every link from raw material extraction to battery manufacturing. The only exception is manganese. In addition, China produces over 98% of the world's lithium iron phosphate (LFP) active materials, which means that Europe has a direct dependence on this cheaper battery chemistry field. Professor Lukes warned, "China's growing dominance in raw materials threatens the future of electric vehicles in Europe. This dependence makes Europe vulnerable. Geopolitical tensions or export suspensions could lead to huge economic losses and billions of dollars in damages
Faced with this challenge, Europe and the United States are also actively taking measures to gain greater control of the lithium-ion battery supply chain through the acquisition of mines and refineries. Although the United States ranks second in global lithium mining ownership and Europe has a relatively small share, its influence in nickel and cobalt is relatively significant. For example, 74% of global lithium comes from Australia and Chile, but Chinese (29%) and American companies (26%) have the largest production shares. However, Europe does not have a significant share of lithium overseas. Professor Lukes said, "These developments highlight global competition for key raw materials and value chain strategic restructuring
In order to reduce dependence on China, research suggests that Europe should take various measures, including investing in expanding its own refining capacity, promoting strategic raw material partnerships, and strengthening local circular economy. This paper, co authored by researchers from Fraunhofer FFB and the University of M ü nster, is based on comprehensive data analysis and aims to depict the overall picture of the current industry power structure.
The release of this study has triggered a profound reflection on the security of the battery supply chain in various sectors of Europe. Against the backdrop of accelerating global electrification trends, ensuring stable supply of key raw materials has become an urgent issue that Europe needs to address. By strengthening its own capacity building and international cooperation, Europe is expected to gain greater autonomy and voice in the future battery industry.
China's dominant position
The study outlines the ownership structure behind mines, refineries, and production plants in the entire battery supply chain. The results prove China's dominant position: China almost dominates the entire value chain of lithium-ion batteries - from raw material extraction to battery production - and controls domestic and international production capacity. The only exception is manganese. China produces the majority of lithium iron phosphate active materials, accounting for over 98% of the market share, which means that Europe directly relies on this cheaper battery chemical.
Lukes warned that "China's increasingly dominant position in the raw materials sector poses a threat to the future of electric vehicles in Europe. This dependence makes Europe fragile." Geopolitical tensions or export bans could lead to huge economic losses, amounting to billions of dollars, "Lukes warned.
Competition and control over the origin of lithium mines
Similar to China, Europe and the United States are also increasing their efforts to gain greater control over the lithium-ion battery supply chain by acquiring mines and refineries. Although the United States ranks second in the world in terms of ownership of lithium mining and Europe has a relatively small share, the situation for nickel and cobalt is completely opposite. Australia, Indonesia, and the Democratic Republic of Congo - major regions for lithium, nickel, and cobalt mining - have been particularly affected by corporate acquisitions. For example, 74% of global lithium comes from Australia and Chile, but Chinese (29%) and American companies (26%) account for the largest production share. However, there are no significant lithium reserves overseas in Europe.
Once a geopolitical dispute arises, export restrictions will have a profound impact on the stability of the global battery supply chain. They believe that a possible means of establishing a secure and sovereign battery supply chain in Europe could be investing in expanding domestic refining capacity, promoting strategic raw material partnerships, and strengthening local circular economies. The joint paper by researchers from Fraunhofer FFB and the University of M ü nster is based on comprehensive data analysis. For this purpose, we analyzed the ownership structure of the global lithium-ion battery supply chain and compared it with the geographical distribution of production shares. The purpose of this study is to depict the overall picture of the current power structure in the industry.
Differentiation chart of global ownership and influence structure of lithium, nickel, cobalt, and manganese:
Lithium: 74% of global lithium comes from Australia and Chile. Nevertheless, companies such as Tianqi Lithium from China and Albemarle from the United States still hold the largest share of global production, with China accounting for 29% and the United States accounting for 26%. Europe has almost no overseas lithium reserves. Our own contribution is negligible, currently limited to the "Baroso Lithium" project in Portugal, which accounts for only 0.4% of production.
Nickel: Although 30% of global nickel production comes from Indonesia, Indonesian companies account for less than 5% of production. In the remaining nickel production in Indonesia, Chinese companies such as Qingshan account for 86% of the share, and with domestic production, China has the largest control over nickel production (32%). The most influential regions after China include Europe, the Philippines, and Russia, which together control over 40% of global production.
Cobalt: Although 68% of global cobalt production comes from the Democratic Republic of Congo, local companies only control 5% of the mines. China (47%) and Europe (47%) hold the main production shares in the region, with major participants including Luoyang Molybdenum, Glencore, and Eurasian Resources Group (ERG). Outside of the control of China and Europe, the Philippines, Russia, and Cuba also have influence (12%).
Manganese: Australia has acquired over half of South Africa's mining rights through the companies' South 32 'and' Jupiter Mines', expanding its influence to a total of 25%. South Africa ranks second with 20%, followed by Europe with 16% of global manganese production. These rights cover mines located in Australia, Gabon, and Ukraine acquired by Anglo American, Eramet, and ERG.
