Whether or not Australia can develop its own battery supply chain has been of much conjecture recently, and Orica chief executive officer Sanjeev Gandhi has now given his two cents.
Gandhi – who spent 30 years at major chemical companies before joining Orica – sees Australia’s strengths in mining and processing but believes it might be a tall ask to develop onshore battery manufacturing capabilities.
“It’s a very long value chain from mining to a hybrid car or e-car,” Gandhi told reporters on the sidelines of a Melbourne Mining Club luncheon. “So we need to be careful (about) where we have our strengths and where we can play.
“Obviously we have our strength in extraction of the resource. The second step is purification; that is something that could come – lithium will be lithium sulphate or lithium hydroxide. That can happen in-country.
“If we take that ambition further and say we want to do battery manufacturing and battery assembly, that’s a different ballgame.”
Gandhi said technologies related to battery manufacturing and assembly is proprietary owned by countries such as Japan, South Korea and China, and then there’s a lot of precise chemistry involved.
“My view is Australia does not have that capability,” he said. “And you’re competing with established value chains in Japan, Korea, and China, which have been running this business for the last 30 years.
“The first laptop computer was enabled because we had the battery technology in Japan. It was Panasonic who came up with the first portable battery, that was 35 years back. So if we’re pretending that we’re going to catch up and start making batteries here, I think we are kidding ourselves.”
Gandhi said Australia’s battery manufacturing prospects could change if a notable battery original equipment manufacturer (OEM) such as LG, Samsung or Huawei chose to build an Australian plant.
“But to set up the (battery) value chain is very challenging,” he said.
“First of all, there’s a lot of technology and investment required. Secondly, you’re catering to a very difficult industry, which is the automotive industry – their standards are extremely high.
“It takes years to get any approvals into a new car or a new model or a new line of products. This is not an easy game to play, so we need to recognise what our strengths are and stay within those strengths, otherwise we will make mistakes and a lot of capital will be burned.
“So stay upstream, but go maybe two or three steps down the value chain. But don’t pretend we’ll make battery packs in this country. That’s not going to happen. You don’t have to knowhow.”
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