Examination of the Electric Vehicle(EV) Lithium Battery Supply Chain Risk of China: Response to the U.S. Supply Chain Reconstruction Policies

Examination of the Electric Vehicle(EV) Lithium Battery Supply Chain Risk of China: Response to the U.S. Supply Chain Reconstruction Policies

This study investigates the Biden administration’s supply chain reconstruction policies on the large capacity lithium battery supply chain, analyzes their impact on China’s EV battery supply chain, evaluates potential risks confronting China’s EV battery industry, and proposes feasible supply chain risk management strategies. In the long term, implementing measures to mitigate political tensions and adopting a stance of active integration into the global market while fostering cooperation with advanced nations are fundamental strategies for the sustainable development of China’s lithium battery supply chain. For temporary measures, Chinese manufacturers can try to diversify supply sources, enhance domestic production, create strategic reserves and develop recycling technology to cope with escalated insecurity in raw material supply. As for intensified market share competition, Chinese manufacturers can try to target emerging markets and strengthen existing markets. Moreover, investing in domestic next-generation battery technology and explore opportunities for strategic collaboration and investment with research and development companies in South Korea, Japan, and the European Union are also critical.