Communication: the key to success in the EV battery sector

Electric vehicle (EV) sales have fallen short of market expectations in 2024. However, as demand for hybrid vehicles grows, the need for enhanced EV battery technology is increasing faster than the industry can keep up with.

From the Inflation Reduction Act in the U.S. to tax exemptions in Australia, government initiatives are encouraging the market to shift towards developing more sustainable mobility solutions with a view to reducing carbon emissions.

Automotive manufacturers—and by default their EV battery manufacturers—face significant challenges to keep pace. Competition in the sector is fierce, with pressure on businesses to be first to market. The technology is constantly evolving—and fast.

This creates hurdles for design, construction, and broader program consistency, with costs already naturally high due to the advanced, specialized equipment needed for these facilities. Baselining, scope control, and the constant monitoring of project risks are the essential basics which must be thoroughly followed.

Furthermore, cost control is clearly important. However, each day the facilities aren’t producing batteries represents a day of lost revenue, making the schedule even more important for long-term success.

Moving the dial on project timelines requires a cultural shift in how clients communicate—internally and with competitors and peers. “How do you set up to achieve a faster speed to market?” is the ultimate question.

Connecting the dots 

The rapid evolution of technology in EV battery manufacturing means equipment specifications are subject to change, potentially multiple times during the design and construction phase. Projects need to be set up with a degree of flexibility to manage this, but chasing every new technological iteration is a risky path to follow.

Given the scale and complexity of the equipment, one small change to the battery being produced could trigger the need for entirely different machinery, with different dimensions and/or weight, and distinct ventilation, cooling, or power requirements.

“To avoid cost and schedule overruns, which typically come with constant design changes, operations teams need to be brought in early during the design phase to agree exactly what technology is being manufactured. It’s essential to plan first and then execute the plan with as little deviation as possible.”

This isn’t to say that the design will remain entirely unchanged. The rate of technological advancement means it’s highly likely that specifications will need to be tweaked somewhere along the line.

It’s crucial to understand the impacts this could have across the chain. That requires close communication between a particularly wide range of stakeholders. We should adopt the mindset that changes are enablers, not constraints.

Making connections across the whole chain is paramount to keeping program delivery and the quality of the end product on track. This is where a program management office (PMO) is critical—making sure the right people are involved at the right time and have the information they need to make informed decisions.   

Creating a culture of knowledge sharing 

The EV battery value chain generally suffers from a wariness of information sharing and peer collaboration. Yet that reluctance could hold back the whole industry, as well as individual projects. For the sector to succeed and build capacity to encourage growth, communication must improve not only within businesses, but also between them.

There are lessons to be learned here from other sectors on collaborating with competitors. The life sciences sector, for example, faces similar pressures around speed to market and managing high demand for specialized skills, materials, and equipment.

“Our own Life Sciences Benchmarking Club is helping businesses learn from peers’ anonymized benchmarking data and experiences to drive efficiency, productivity and standards across the board.”

A cultural shift in how EV battery manufacturing clients work together and share knowledge will be vital to speed up project delivery and allow less mature markets to catch up with those more advanced in manufacturing.

Looking locally and globally to strengthen procurement 

Competition for resources in this sector is exacerbated by incredibly high demands in other competing markets like data centers, semiconductors, life sciences, and energy. Oversight of supply chains chains and programs is crucial to identify bottlenecks early and mitigate their impacts.

Understanding local capacity is just as important for these programs. The logistical and schedule-based benefits of being close to suppliers is encouraging clusters near manufacturing hubs of high-volume materials.

For example, EV battery manufacturing has grown in Canada; however, local steel manufacturers have had minimal involvement so far. But clustering has both advantages and disadvantages.

“Clients need to trust local partners who understand the market conditions and can identify when and where high regional demand might cause delays or resource bottlenecks. For clients, it's important to focus on the outcome, rather than how it’s achieved.”

This highlights the role of the PMO in helping clients make informed, process-driven procurement decisions based on global and local factors. These may include diversifying suppliers, securing orders earlier, or targeted contracting models.

Demand in the EV battery value chain and its adjacent markets is set to remain high. With the supply chain already stretched, greater efficiency is needed to get manufacturing facilities up and running—and producing—quickly. This relies on clients looking up and out, rethinking their approach to knowledge sharing and collaboration across their own teams.

Open and transparent communication will be the biggest driving factor for the sector’s success.