The electric vehicle industry has embraced consolidation and efficiency. We’re seeing automakers slash costs and expand platform-sharing to minimize input and maximize output. Now, there’s a chance for EVs to be even more efficient by embracing the principles of a circular economy. Instead of the wasteful take, make and dispose approach, the industry can follow a reduce, reuse and recycle philosophy—and that’s more important for the lithium-ion battery than anything else.
This kicks off our Friday edition of Critical Materials, your daily round-up of key events and news shaping the world of electric vehicles.
Also on our radar today: Rivian’s $6.6 billion loan from the U.S. government is locked in. That deal was negotiated for over two years and President Trump can’t just revoke it with an executive order. Plus, Nissan is on the chopping block in terms of costs, jobs and production.
30%: Second-Life EV Battery Market Is Poised To Grow
Photo by: IDTechEx
The high-voltage battery is the costliest and the most critical component in an EV. It packs chemicals that can be hazardous to the environment if not properly disposed of at the end of its lifespan. Thankfully, there’s an ongoing global effort to ensure that doesn’t happen in the future.
The second-life EV market could be worth $4.2 billion in a decade’s time, according to U.K.-based research firm IDTechEx. When it proliferates, the need to extract more raw materials could be reduced, paving the way for a circular economy that’s less harmful to nature.
Millions of EVs with huge, energy-dense batteries are entering service every year globally. At some point in the future, these EVs will also have to be retired. When that time comes, the doors will open for those packs to be recycled or repurposed into second-life applications such as energy storage.
IDTechEX says much of that growth potential can be attributed to the use of nickel and cobalt in the cathode—the negative electrode in a battery. These minerals facilitate energy density and hence improve the economics of recycling a nickel-manganese-cobalt (NMC) battery. Lithium-iron-phosphate (LFP) batteries, on the other hand, are less economically viable for recycling due to the absence of cobalt and nickel.
But regardless, this whole industry is expected to undergo a silent revolution over the next few years. InsideEVs also reported in November that the falling lithium prices would make battery replacement in EVs even cheaper than replacing an engine on an ICE car.
However, several bottlenecks would need to be addressed before the second-life EV market truly takes off.
Here’s more from that report:
Many factors contribute to the overall cost of second-life battery repurposing, including logistics costs, materials and components, and the need for manual intervention in the repurposing process, which includes manual inspection, testing or grading, and end-of-life (EOL) EV battery disassembly and reassembly.
Within these key process steps, IDTechEx has identified several key bottlenecks that contribute significantly to overall repurposing costs. These include the cost of the retired EV battery and testing or grading. Logistics costs are also not to be underestimated. Since EOL batteries are typically shipped in low volumes and over long distances in the current market, logistics can form a significant proportion of overall repurposing cost.
The battery recycling industry has already taken off in the U.S. Over the next few years, America’s recycling capacity is expected to be roughly half a million tons annually. Repurposing EV batteries also has huge unlocked potential.
However, the U.S. has a long way to go. It can maybe even learn from China and the EU, which require minimum recycled content in a battery. In the EU, for example, EV batteries will need to have a certain share of recycled materials by 2031—16% cobalt and 6% lithium and nickel each. If the EV industry in the U.S. wants to adopt the circular economy principles, it may also need similar standards at some point in the future.
60%: Rivian’s $6.6 Billion Loan Seems Safe, For Now
A render of Rivian’s upcoming plant in Georgia.
Just days before President Trump took office, the Biden administration finalized a colossal $6.6 billion loan for Rivian to finance the construction of its Georgia plant. Now the question looms: Can Trump pull the U.S. government out of its agreement with the EV start-up?
InsideEVs asked Rivian CEO RJ Scaringe about that possibility during a roundtable with reporters. He believes the loan is safe. “We signed a legally binding document with the Department of Energy,” Scaringe said.
“Our relationships with Republican congressional members is very strong,” Scaringe added. “The loan is for a plant in Georgia, which certainly leans to the right. There’s a lot of advantages we see in that as well. But we don’t look at the loan and think it’s at any significant risk.”
The Georgia factory, located about an hour east of Atlanta, is central to Rivian’s expansion plans in the U.S. The automaker plans to launch three new EVs starting next year, including the R2, followed by the R3X and then the R3.
While the R2 will be initially manufactured at an expanded facility at its Normal, Illinois plant, the R3 and R3X will likely be made in Georgia. The plant is also expected to add 7,500 manufacturing jobs and has garnered support from the state government. Pulling back would not only hurt Rivian but also the local counties expecting a boost in economic activity with the billions in federal investment.
90%: Nissan Is On A Chopping Block
Things might get worse at Nissan before they potentially get better.
Three of the Japanese automaker’s U.S. plants are preparing to offer buyouts to workers and cutting shifts in a bid to save $2.6 billion in global costs, Reuters reported on Thursday.
One of the two shifts at the Rogue production line in Smyrna, Tennessee, will be cut. That plant also makes the Leaf. The same is expected for the line that builds the Altima sedan in Canton, Mississippi.
It’s unclear how many jobs exactly would be cut in the U.S. Nikkei estimates that the workforce would reduce by about 1,500—about 11,700 workers were employed at Nissan’s three U.S. factories as of the end of 2024.
Nissan does have a huge merger deal with Honda that’s pending. But before we see the fruits (or even basic details like how they plan to merge operations) of that, things will likely be rough for Nissan.
100%: How Has Your EV Battery Aged?
Photo by: CATL
The fear of EV batteries losing range over time or even going dead has hampered the broader adoption of EVs in the U.S. But the tech has come a long way, and EV batteries don’t need replacements even after hundreds of thousands of miles. There’s a reason why the warranties are so long, stretching up to eight years in most cases. Now, there’s an entire recycling ecosystem in the works to make sure the batteries don’t go to waste even at the end of life.
If you drive an EV, what does the health and degradation look like on your battery? Do you worry about what will happen to your battery over time? And have you thought about recycling or repurposing it?
Have a tip? Contact the author: suvrat.kothari@insideevs.com
