Europe’s battery dependence on China is clear, but closing the gap alone will be difficult. Partnering with South Korea, the world’s second-largest manufacturer, offers a faster and more realistic route
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Europe is still highly dependent on foreign players. China dominates the entire battery supply chain, producing 80% of global battery cells, most of them within its own borders. For lithium-iron-phosphate (LFP) batteries, increasingly preferred by carmakers, China controls a staggering 94% of global production. European EVs using LFP batteries rose from 3% in 2022 to 10% in 2024, with nearly all supplied by China.
Closing the gap with a purely domestic strategy will be difficult. A more realistic route for Europe lies in deepening industrial cooperation with other countries. South Korea is one such promising partner, with globally competitive firms, large-scale manufacturing capacity, existing industrial footprint in Europe—accounting for 78% of our installed battery-manufacturing capacity—and active efforts to reduce dependencies on China.
This should be seen as a complement, not a substitute for building up Europe’s own industry. With the right policy framework, cooperation can accelerate de-risking while enabling the sharing of technology and manufacturing knowledge that many European players still lack.
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To strengthen these pull factors, European policy should continue efforts to reduce red tape, simplify permitting procedures and, most importantly, stay on course with the green transition. Policy reversals, like the recent softening of fleet requirements for European carmakers, undermine confidence in Europe’s future battery demand and ultimately weaken Europe’s attractiveness as an investment destination.
China’s battery dominance in Europe is not inevitable. South Korea already stands as a capable and established partner, producing NMC and increasingly LFP cells for both EVs and energy storage, while actively diversifying their supply chains from Chinese inputs. With the right policy framework, this partnership could form the backbone of a more resilient battery supply chain in Europe.
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