Global skills shortage in EV battery industry could slow race to clean up transport

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Worldwide efforts to clean up road transport in the race towards zero emissions could be affected by a global skills shortage facing makers of batteries for electric cars.


South Korean battery companies that supply electric vehicles (EV) producers Tesla Inc (NASDAQ:TSLA), Volkswagen Group (XETRA:VOW) and Ford Motor Company (NYSE:F) are struggling to find research and engineering specialists amid soaring demand for EV batteries, according to a report by Reuters.


The country’s three biggest battery makers, LG Energy Solution (LGES), SK On and Samsung SDI Co Ltd, account for a third of the world’s EV battery market.


“Although we are seeing such a growth in the industry, it appears that we are facing a shortage of talent,” an official at LGES told Reuters. “It is crucial to recruit external talents as well as nurturing our own talent.”


South Korea is short of almost 3,000 graduate degree-level positions in areas such as research and design, according to data from the Korea Battery Industry Association.


This is coupled with a growing skills shortage across the global battery market, Reuters reported.


It said the European Battery Alliance planning group estimates that the EU’s battery industry needs 800,000 new workers by 2025.


If the global skills gap is not plugged, some industry experts believe it could slow the pace of advances in batteries, which are being counted on to clean up road transport, one of the biggest sources of greenhouse gas emissions.


The global battery sector has doubled in size over the past five years and, according to IHS Markit forecasters, it will triple in size to almost US$90bn by 2025.


LGES plans to increase its production capacity from 155 gigawatt-hours (GWh) of batteries by the end of this year to 430 GWh in 2025, which could power about 7.2mln EVs.


SK Innovation aims to boost its annual production capacity more than five-fold to 220 GWh by 2025 and has announced plans to build three battery plants in the US together with Ford.


Richard Kim, principal analyst at IHS Markit, said the skills gap was likely to be a problem for years to come.


“The labour shortage in the battery industry has already been a global issue, and the reality is that there has been an imbalance of supply and demand of manpower as many companies start to expand their capacity,” he said.

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