Transport & Environment (T&E) said on October 2, 2026, that planned European Union battery cell production could meet demand from all EU-manufactured battery-electric vehicles covered by the proposed Industrial Accelerator Act (IAA) by 2030. This outcome depends on all identified projects materializing, including those rated as medium confidence.
EU cells could meet IAA demand by 2030
T&E says local-content rules are feasible, but demand certainty and targeted support are needed to unlock European battery investment.
The analysis identifies cathode materials and their precursors—not cell availability—as Europe’s main battery supply-chain bottleneck.
The IAA scope considered by T&E includes corporate vehicles and privately purchased electric vehicles receiving subsidies or tax support, as well as vans. Under the current European Commission proposal, battery components for corporate vehicles would need to be produced in the EU, while subsidized private vehicles could use components from free trade agreement partners.
T&E estimated that local content requirements for cells and cathode active materials could increase EU battery demand by 34% compared with the current baseline in 2027. The organization said demand certainty and targeted support would be needed to scale domestic production amid competition from Chinese battery imports, which it said face virtually no tariffs.
According to the analysis, cathode active materials (CAM) and precursor cathode active materials (pCAM) are the main bottlenecks in Europe’s battery supply chain. China controls up to 90% of global pCAM and CAM production capacity, depending on the chemistry, with its share reaching 95% for lithium iron phosphate.
T&E found that CAM requirements for corporate vehicles covered by the IAA could be met, but additional capacity would be required to supply eligible private vehicles. It also proposed a minimum pCAM threshold that could be met with trusted partners. The organization said European CAM and pCAM projects require stable offtake agreements with regional cell manufacturers, which in turn depend on predictable EV demand.
The analysis assumes that EU production includes both lithium iron phosphate and nickel manganese cobalt cell projects, that the current ratio between private and corporate vehicle channels remains unchanged, and that eligible EU-assembled EVs can shift additional cell sourcing to European production.
Source: transportenvironment.org
