BASF SE is investing to enter the currently struggling auto battery industry, on the hopes that customers will still be attracted to electric vehicles. The company, learning from the failures of collapsed battery makers, will focus on making batteries that allows EVs to run longer. BASF has made battery materials one of the 10 areas it is targeting for growth. "We are committed," Adrian Steinmetz, head of global business management at BASF's battery materials unit, told Bloomberg in an interview. "Having this long-term strategy is typical of BASF." The company’s aim highlights a willingness by chief executive Kurt Bock to invest into a market where returns may take time.
Some rivals have already collapsed, no thanks to sluggish demand for electric cars and reputation issues due to fires that broke out in some Tesla vehicles. Israeli charging station developer Better Place Inc. filed for bankruptcy in 2013 while Evonik Industries AG is now looking for a buyer for its battery activities including a joint venture with Daimler AG.
Ironically, Evonik said six years ago that it wanted to become Europe's leading producer of lithium ion battery components. In October 2013, chief executive Klaus Engel remarked that the carmaker was abandoning the project. "The electric auto market was expected to soar in the direction of the sky," Joachim Krotz, partner at consultancy Oliver Wyman, told Bloomberg.
"But all of that didn't come true.” He noted that the increase of battery capacity is taking so long. “They are still too heavy. They still lack power." Siemens AG has also closed its EV charging operations in 2013, citing slower-than-expected market growth. [source: Bloomberg]