China EV battery makers seeking PHL manufacturing partners

THE Philippine electric-vehicle industry is in talks with Chinese battery makers to set up shop in the Philippines due to the potential of the electric vehicle market here, an industry official said.

“Since last year, we’ve been talking to a lot of Chinese manufacturers of batteries — lithium-ion batteries. They’re really interested to locate here in the Philippines because they see that there’s a good market for electric vehicles from what they’ve seen, from what they’ve experienced in the last several years,” said Ferdinand I. Raquelsantos, chairman emeritus of the Electric Vehicle Association of the Philippines (EVAP), in an interview last week.

He said he and other industry officials have held talks with members of the Power Battery Application Branch of the China Industrial Association of Power Sources for possible partnerships.

“They’re talking to EVAP… and we’re matching them with different players, especially the raw material providers,” said Mr. Raquelsantos, who is also president of Philippine Utility Vehicle Inc.

He was referring to Philippine-sourced nickel, which is used in the manufacture of EV batteries. The existing arrangement is for the raw material to be exported to Chinese battery makers, he said.

“If they do the assembly here of the batteries, then they get the raw material here, locally. So it’s a perfect scenario,” he said.

Mr. Raquelsantos said the target of EV manufacturers is to reduce the cost of battery in making green cars. He said lowering the cost will help make vehicles more affordable.

“The target is about 15-20% of the vehicle should be the cost of the battery. Right now, it’s about 50-60%,” he said. “I’m talking about lithium ion.”

He said a business-to-business meeting was held last week between the Chinese group and “interest parties” from the Philippines. He declined to disclose the identity of the Filipino groups, but said only that the manufacture of EV batteries has similarities to the manufacture of semiconductors, and that members of the latter industry were involved.

“We’re hoping this year, we will find some concrete programs already and schedules,” he said.

“They brought their members and their members are talking to the local prospective partners,” he added. “We wanted to have one [partnership] at least first, and then hopefully they’ll follow — the rest.”

Should a partnership be forged, the resulting business will be more of an assembly of lithium batteries using existing Chinese technology and research.

“They find it very conducive to produce here because the cost of labor is cheaper. The cost in China is a lot more than us. And they have the engineers, technicals who can really support the production,” he said. “They just put up a plant here and produce.”

Mr. Raquelsantos said the possibility of bringing battery manufacturing to the Philippines could also result in the assembly of completely-knocked down EV units in the country.

“When it comes here, then we generate jobs, and then we can localize jobs, and it can really provide volume and lower cost,” he said. — Victor V. Saulon