A new report by Dunne Insights and the European Initiative for Energy Security has found that Europe is several years behind China in the electric vehicle and battery sector, and offered several strategic recommendations aimed at closing this gap.
It said Europe was “7-10 years behind” China and emphasized the need for Europe to invest billions in the industry and to establish strong regulatory frameworks, among other initiatives.
To enhance European production capabilities, the report urged key stakeholders to invest and establish partnerships with Japanese and South Korean battery manufacturers. It suggested a funding target of Eur20 billion ($20.7 billion) for the development of new advanced battery gigafactories.
The report stressed that such investments must be accompanied by a robust regulatory framework to “prevent non-compliant imports from China — both vehicles and batteries.”
To facilitate this, it called on the EU to implement tariffs designed to strengthen European battery production.
One of the proposed measures includes a gradual introduction of a 50% tariff on imported batteries over a five-to-seven-year period. This phased approach is intended to “allow time for companies to scale up local production and compete effectively.”
Additionally, the report encouraged European authorities to adopt strategies similar to the US Inflation Reduction Act, which provided financial incentives that led market participants — such as carmakers and battery producers — to commit nearly $250 billion to new clean energy projects.
Dunne Insights estimated battery investments would require approximately Eur100 billion, with Eur20 billion earmarked specifically for the new advanced battery gigafactory in collaboration with South Korean and Japanese partners.
The report advocated for a comprehensive “solid framework” across Europe to maximize the region’s chances of success.
EIES Executive Director Alberic Mongrenier acknowledged the challenges in developing a cohesive strategy, noting that various member states had their own distinct approaches.
He cited the example of Norwegian battery manufacturer Northvolt, which Dunne Insights Founder Michael Dunne attributed its failure to “doing too much too fast.”
The report also highlighted the importance of strategic engagement with China, which currently dominates the battery manufacturing sector. It stated that part of its objective is to “communicate to the Chinese the terms of their engagement” and to “define the conditions of China’s access to the European market.”
Read the full story: “EU urged to invest Eur100 bil, impose tariffs on China batteries to boost competitiveness.“
