Mar 3, 2026
The EU can significantly reduce local battery prices through its 'Made in Europe' initiative.
Increasing production in Europe could reduce the cost difference between EU-manufactured batteries and those from China to about 30 percent from the current 90 percent, according to a report from transport and environment organization T&E. The group is calling on the EU to back the industry through its “Made in Europe” initiatives.
The European Commission plans to introduce its “Industrial Accelerator Act” on March 4, aiming to give priority to locally produced goods when using public funds. This act will focus on “key strategic sectors” such as batteries, solar and wind energy, hydrogen production, nuclear energy, and electric vehicles.
Some automotive manufacturers have expressed concerns that local content requirements could significantly raise battery costs and harm their competitiveness.
T&E's report indicates that enhancing manufacturing efficiency—especially by reducing scrap rates and improving labor skills and automation—could lower the cost difference to $14 per kilowatt-hour by 2030, down from a potential $41.
This would result in an approximate cost difference of €500 ($590) for the average electric vehicle, which could decrease further thanks to public incentives or be viewed as a safeguard against export restrictions that China has imposed on essential minerals and rare earth elements.
“Europe must develop a domestic battery industry to protect itself from potential disruptions in supply chains. Local content requirements are the only viable solution to prevent another Northvolt situation. The costs associated with Made-in-EU regulations are a necessary investment in sovereignty,” stated Julia Poliscanova, T&E’s senior director for vehicles and e-mobility supply chains.
The cost gap will only decrease if EU local content mandates enable companies like ACC, Powerco, and Verkor to increase production.
T&E emphasized that the Made in Europe initiative should clearly delineate that public support programs must include EV tax rebates for electric vehicle owners as well as for both employers and employees involved in corporate car schemes.
The European Commission plans to introduce its “Industrial Accelerator Act” on March 4, aiming to give priority to locally produced goods when using public funds. This act will focus on “key strategic sectors” such as batteries, solar and wind energy, hydrogen production, nuclear energy, and electric vehicles.
Some automotive manufacturers have expressed concerns that local content requirements could significantly raise battery costs and harm their competitiveness.
T&E's report indicates that enhancing manufacturing efficiency—especially by reducing scrap rates and improving labor skills and automation—could lower the cost difference to $14 per kilowatt-hour by 2030, down from a potential $41.
This would result in an approximate cost difference of €500 ($590) for the average electric vehicle, which could decrease further thanks to public incentives or be viewed as a safeguard against export restrictions that China has imposed on essential minerals and rare earth elements.
“Europe must develop a domestic battery industry to protect itself from potential disruptions in supply chains. Local content requirements are the only viable solution to prevent another Northvolt situation. The costs associated with Made-in-EU regulations are a necessary investment in sovereignty,” stated Julia Poliscanova, T&E’s senior director for vehicles and e-mobility supply chains.
The cost gap will only decrease if EU local content mandates enable companies like ACC, Powerco, and Verkor to increase production.
T&E emphasized that the Made in Europe initiative should clearly delineate that public support programs must include EV tax rebates for electric vehicle owners as well as for both employers and employees involved in corporate car schemes.