Market Insights

Carmakers, Battery Suppliers Gear up for EV Sales Boom

October 05, 2022 by Shannon Cuthrell

Record growth in EV sales in 2022 has led many carmakers and battery developers to accelerate their production capacity expansions.

The electric vehicle market is rising above the COVID slump and supply chain shortages that previously rocked the broader automotive industry. Last month, the International Energy Agency projected that EVs would claim a 13% share of all vehicle sales this year, up from 9% in 2021.

Kelley Blue Book recently reported that battery-powered EV sales grew 13% in the second quarter alone, marking a 66.4% increase year-over-year. However, hybrid EVs and plug-in hybrid EVs have declined by 10.2% since the second quarter of 2021, and fuel cell vehicle sales fell another 25.9%. Despite that shortfall, as Cox Automotive noted recently, the overall growth in EV sales can be tied to high gas prices pushing increased interest in the market.



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A breakdown of EV categories and sales in the second quarter, according to Kelley Blue Book. Image used courtesy of KBB/Cox Automotive


Meanwhile, more EV manufacturers are looking to expand their battery manufacturing activities in the U.S. or take the process in-house. Seeing strong sales in their end market, several EV battery developers expect a revenue boost.

With that, leading carmakers are introducing or expanding plans to grow their production capacity, including their battery supply. Here’s a quick sampling of three players.



Tesla closed its highest vehicle production month in history last June, with its quarterly output exceeding 258,000 Model S/X and Model 3/Y vehicles, along with 254,000-plus deliveries. In Tesla’s second-quarter earnings call in July, executives said they don’t see any major inflation-related issues impacting the supply of semiconductors, battery cells, and other components. They reiterated that Tesla has grown cell production significantly over the last year and has long-term contracts with its partners for key battery metals. That said, the company still sees some production tightness in older generation semiconductors—especially analog and mixed-signal devices—though the latest generations are more stable.

A key supplier to Tesla is Japanese conglomerate Panasonic, which is increasing its North American footprint with new plans to invest $4 billion in building its second EV battery factory in Kansas. The firm has shipped over 6 billion EV battery cells out of its factory in Nevada (located inside Tesla’s gigafactory). It is commercializing a new battery, 4680 cells, to further promote its business growth.


A look at Panasonic’s battery cells. Image used courtesy of Panasonic


Aside from batteries, Panasonic develops infotainment systems, switches, advanced driver assistance systems, and other products as part of its automotive segment. Released last month, the company's annual report mentioned its automotive-sector sales grew 5% in 2022 due to the rebound effect of reduced automotive production in the first half of last year, together with the impact of exchange rates.



With a massive EV expansion strategy underway, Ford has secured enough battery capacity and contracts to reach its goal of 600,000 EVs by late 2023. That’s 70% of the capacity it needs to reach its goal of over 2 million EVs annually by late 2026. Responding to hot demand, the company recently added lithium iron phosphate (LFP) battery packs to its Mustang Mach-E and F-150 Lightning lineups.

In July’s second-quarter earnings call, Ford CEO Jim Farley said the company had been overwhelmed with demand for its first-generation EVs—the Mustang Mach-E, F-150 Lightning, and E-Transit van—with strong multi-year order banks. And in July alone, Ford was expected to produce 14,000 EVs globally, significantly higher than in previous months.

Ford sources its EV batteries from the world’s top battery producer, China-based Contemporary Amperex Technology Co., Ltd. (CATL). Ford recently announced that CATL would provide full LFP battery packs for Mustang Mach-E models in North America starting in 2023 and F-150 Lightning in early 2024.

Another longtime supplier to Ford, South Korean electronics giant LG Energy Solution, scaled quickly to double capacity at its facility in Poland to support incremental cell production for Mach-E and E-Transit models using Ford’s existing nickel cobalt manganese (NCM) chemistry.

Ford also has a joint venture to produce battery materials with South Korea-based SK On, which installed enough capacity to scale Ford’s high-volume F-150 and E-Transit lineups through late next year. 


General Motors

General Motors is also expanding its U.S. production capacity, recently kicking off battery production at its new manufacturing plant in Ohio. The Michigan-based auto giant set ambitious goals to reach 1 million units of annual EV capacity in North America by 2025. Still, unlike the other companies in this article, sales have recently declined across its EV lineup. The company's second-quarter earnings release reported around 7,300 EV sales in its GM North America business (including its Chevrolet Bolt and GMC Hummer brands), down from 11,300 in the second quarter of 2021. However, that’s still an improvement from the first quarter, which totaled 457 EV deliveries.

Despite rocky sales, GM says it has secured enough raw material to support its 2025 targets, recently announcing major battery capacity expansions across four battery cell manufacturing plants, consolidating its semiconductor purchases into three families co-developed with leading manufacturers, and unveiling three EV programs in North America with annual production volumes exceeding 125,000 units each.

One of its key partners is LG Energy Solution, which develops batteries with GM under the pair’s Ultium Cells LLC joint venture. Last week, the two companies received support from Indiana officials on incentives for building their fourth battery plant, expected to cost over $2 billion.


An overhead shot taken in March 2022 of GM’s Ultium Cells production facility in Warren, Ohio. Image used courtesy of General Motors


In July, LG Energy Solution announced plans to triple its revenue over five years by expanding its joint ventures with original equipment manufacturers. Most of its production capacity increases will be centralized in North America, where it hopes to grow its footprint from 7% currently to 45% by 2025.