Major Developments in 2023
The United States (U.S.) population continues to heavily rely on vehicles for personal transportation. In 2023, as the COVID-19 pandemic receded, individuals drove more often than in 2022. The cumulative national vehicle miles travelled (VMT) for the year 2023 was 3,263.7 billion vehicle miles (data available till the end of December 2023), which represents an increase of +2.1% (+67.5 billion vehicle miles) compared to the prior year.
Sales of electric-drive vehicles in the U.S. in 2023 showed a significant growth – increasing nearly 51% from their 2022 value (1,402,371 in 2023 compared to 931,393 in 2022) and the cumulative total reached 4.68 million plug-in electric vehicles
(PEVs) (using December 2010 as the comparison base). During 2023, there were 90 PEV models sold in U.S. commercially – these included both plug-in hybrid electric vehicles (PHEVs) and battery electric vehicles (BEVs) – as well as 35 hybrid electric
vehicle (HEV) models, for total sales of ~2,577,800 units.
Industry and Market
Market developments included:
- LG Energy Solution and Honda announced the establishment of a joint venture to produce lithium-ion batteries for electric vehicles from Honda. The plant would have an annual production capacity of approximately 40GWh.
- Tesla will invest an additional $3.6B in Nevada to further expand its Gigafactory NV with two additions: a 100 GWh 4680 cell factory (to produce batteries for 1.5M vehicles per year) and an earlier-announced high-volume Semi factory.
- GM will invest $650M in a U.S. lithium mine.
- Tesla will open part of its U.S. charging network to EVs from rival manufacturers as part of a $7.5B federal program to expand the use of EVs.
- Stellantis announced that it will invest a total of $155 million in three Kokomo, Indiana plants to produce new electric drive modules.
- VW Group-backed Scout Motors announced plans to open a $2B electric truck and SUV manufacturing plant outside of Columbia, SC.
- Amprius signed a letter of intent for a 775,000 sq. ft facility in Brighton, CO – it would become operational in 2025 with potential capacity of 5 GWh.
- Albemarle announced plans to locate its $1.3B lithium hydroxide Mega-Flex facility in Chester County, SC.
- Group14 started construction on a second commercial-scale battery active materials factory in Moses Lake, WA. The 1M sq. ft facility will be the world’s largest silicon battery materials factory for electric vehicles.
- Panasonic is planning to build a $5B automotive battery plant in Oklahoma, its third U.S. plant for EV batteries – the prior two plants are in Nevada and Kansas.
- GM and Samsung plan to invest over $3 billion in a new U.S. electric vehicle battery cell plant.
- Hyundai and SK-On will build an EV battery factory in Bartow County, GA to supply the Hyundai Motor Group, including for the Kia and Genesis lines.
- Anovion Technologies selected Decatur County in Georgia as the manufacturing location for its synthetic graphite anode materials.
- LG Energy Solution will invest approximately $5.5B in a battery manufacturing complex in Queen Creek, AZ, in two facilities – one for building cylindrical cells and another for lithium iron phosphate pouch cells.
- Toyota will be assembling a new, three-row, battery electric SUV at Toyota Kentucky starting in 2025. The battery plant is currently under construction and will receive an additional $2.1 billion investment.
- AESC held a groundbreaking ceremony for a new 30 GWh battery plant in Florence County, South Carolina. Commercial operations at this 1.5 million square foot plant are expected to start in 2026.
- GM and Samsung SDI are planning to build a $3B EV battery cell plant in New Carlisle, Indiana for supplying GM’s future EVs.
- Hyundai and LG Energy Solution will invest over $7.5B for making batteries at Hyundai’s U.S. EV plant currently under construction in Georgia.
- Minerals specialist company ICL inaugurated a large-scale battery materials manufacturing plant in St. Louis, MO. The $400M plant will manufacture lithium iron phosphate material for batteries and will be operational by 2025.
- Stellantis and Samsung SDI signed an MOU to establish a second battery manufacturing facility in the U.S. to start production in 2027, with an initial annual capacity of 34 GWh.
- Toyota announced a new investment of nearly $8B in its plant for manufacturing batteries for Toyota in NC, bringing its total investment to $13.9B.
Charging Infrastructure
Walmart intends to expand its EV fast-charging network at Walmart and Sam’s Club locations nationwide, while Ford, GM, Hyundai, and Kia will utilise Tesla’s Supercharger network in North America, significantly increasing fast-charging options for their EV users.
Policy and Government
Federal government developments included:
- ARPA-E selected 12 projects for its EVs4ALL program aimed to expand domestic EV adoption by developing better batteries for EVs.
- Redwood Materials received a conditional commitment for a $2B loan from DOE’s Loan Program Office for the construction and expansion of its first battery materials campus.
- DOE provided a $375M loan to Li-Cycle, a battery recycling company, to build a lithium-ion battery recovery plant near Rochester, NY. The facility will support about 200,000 EVs per year. Discarded lithium-ion batteries will be sent to NY – then transported to sites in Gilbert, AZ, Tuscaloosa, AL, and Ontario, Canada.
- DOE and Stellantis announced the launch of the Battery Workforce Challenge, which includes a three-year collegiate engineering competition; vocational training; youth education in science, technology, engineering, and mathematics (STEM); and career and technical education.
- DOE announced over $192M in new funding for recycling batteries from consumer products; launching an advanced battery R&D consortium; and it is going to continue its Lithium-ion Battery Recycling Prize initiated in 2019.
State and local government developments
New York City secured $10.1 million in federal grants to replace nearly 925 ICE fleet vehicles with EVs and to install 315 new EV chargers. Additionally, American Li Energy in Carlsbad, CA, received a $13.2 million grant from the California Energy
Commission to build a pilot lithium-ion manufacturing facility for zero-emission vehicles.
Outlook
DOE’ publishes some of its EV market projections in the Energy Information Administration’s (EIA) yearly report Annual Energy Outlook (AEO)35. The 2023 AEO Reference case represents its best assessment of U.S. and world energy markets
through 2050, using key assumptions intended to provide a baseline for exploring long-term trends. EIA based the economic and demographic trends reflected in the Reference case on the current views of leading economic forecasters and
demographers – assuming improvements in known energy production, delivery, and consumption technologies but no changes in current laws and regulations for the energy sector.
EIA explored long-term energy trends in the United States and presented an outlook for energy markets through 2050. It used different scenarios to understand how varying assumptions affect energy trends. The AEO2023 Reference case, which
serves as the baseline case, reflects laws and regulations adopted through mid November 2022, including the Inflation Reduction Act (IRA). According to AEO-2023, it is projected that PEVs (including both BEVs and PHEVs) will account for between 13% and 29% of new light-duty vehicle sales in the U.S. in 2050 and between 11% and 26% of on-road light-duty vehicle stocks.
Declines in EV component costs, along with federal and state policies that provide incentives for EV purchases or require minimum sales, are included in estimating EV sales growth in the EIA model projection. EIA projected its cost declines for EV
battery manufacturing by using learning rates based on the historical relationship between cumulative production and price. It was assumed that the costs of battery materials, primarily consisting of critical minerals, will remain constant through 2050.
The projected manufacturing cost declines both increase driving range and lower EV purchase prices through 2050.
In other projections, forecasts from Bloomberg New Energy Finance expect global sales of light, medium, and heavy-duty PEVs to continue growing. Per those forecasts, passenger EV sales would continue to rise sharply in the years ahead. Technology changes are at the core of this transition as battery prices have fallen dramatically over the last decade. In the U.S., pushed by the Inflation Reduction Act, EVs would reach nearly 4.2 million in sales by 2026 – accounting for 28% of passenger vehicle sales (up from 7.6% in 2022).