Countries located in the European Economic Area and Switzerland have pledged close to US$232.7bn or €200bn on EV supply chains and manufacturing.
New Automotive, the research group, said out of €200bn on EV supply chains and manufacturing, €109bn is for the supply chain for batteries, almost €46bn when it comes to public charging networks and €60bn for the supply chain for batteries.
Notably, the Chinese firms make almost 70% of the electric vehicle batteries in the world and provide battery cells for over 80% of electric cars globally, as reported by the International Energy Agency.
CATL, BYD and other manufacturers own most of the refining capacity when it comes to battery materials, including lithium. New Automotive reports that currently, Europe manufactures batteries for almost one in three electric vehicles sold on the continent.
Investment spread across Europe
New Automotive said Germany covered nearly a quarter of the region’s investment. France accounts for 18% and Spain and Portugal for 12%.
Norway, on the other hand, accounts for 1.6% of total investments. Sweden makes up 3.8%, whereas Finland and Denmark are only 3.6% and 0.8%, respectively.
According to the European Environment Agency, the Nordic countries are leading Europe in terms of adoption of electric vehicles. Norway leads the world in percentage of electric vehicle sales, while Denmark, Sweden, and Finland lead the market.
It is well to be noted that Germany produces 50% of all electric vehicles made in Europe, the German Automotive Association stated. The European Commission announced in December 2025 a plan to scale back its prohibition on internal combustion engine cars from 2035 and instead require 90% of new cars sold from that date to be zero-emission.
Battery Supply Chain Capacities
The research finds that batteries account for the largest share of capital. It encompasses mining, refining, materials, gigafactories, as well as recycling.
Europe has the capabilities in cell manufacturing as well as downstream integration. But there are deficiencies in cathodes, precursors, along with midstream value chain components.
Investments in batteries remain capital intensive and characterised by intense global rivalry, the report said. This leaves them most susceptible to delays, downsizing or cancellation.
Asian battery makers such as CATL and LG Energy Solution are well-established in the region. European-owned companies, like Volkswagen’s PowerCo, are starting to design, create, and manufacture cells completely within the continent.
According to the Chief Executive Officer of Volkswagen Group, Oliver Blume, “We are the first European carmaker to establish our own battery cell development and production. This step strengthens our position and independence in the global competition.”
Production and recharge infrastructure
The report says manufacturing of electric vehicles in Europe is focused on legacy automotive plant conversion and exclusive new electric vehicle-only plants. The manufacturing of batteries is increasingly co-located to lower costs and supply risk.
It is mainly taking place in the traditional car-making areas, such as Germany and Spain. This work is being done by both original equipment manufacturers from Europe as well as international manufacturers.
Let us look into these facts – Tesla operates a €5.8bn, or a US$6.7bn, Gigafactory in Grünheide, Germany, which can go ahead and manufacture 375,000 electric vehicles a year. Stellantis has confirmed that it is going to build the Opel C-SUV BEV with Chinese automaker Leapmotor at a plant in Spain, by way of utilising the China New Energy Vehicle ecosystem.
New Automotive stated that “Europe has set up a position for itself in the manufacture of high-power charging infrastructure. More than €3.5bn is being invested throughout the continent in this manufacturing, with ultra-fast systems supplied by leading companies throughout Italy and Germany as well as the Nordics.
The public launch of charging infrastructure is projected to be between €23bn or US$27bn and €46bn or US$53.5bn. The region has installed over a million public charge points.
China’s EV market
China is the largest electric vehicle market globally, with 11.3 million electric vehicle sales in 2024, stated the International Energy Agency. This happened to be 48% of its total vehicle sales.
The Center for Strategic and International Studies says the country has spent at least US$230bn on R&D for electric vehicles between 2009 and 2023.
The funding includes an array of government support, such as an exemption from 10% sales tax, funding when it comes to infrastructure, research and development programmes as far as manufacturers and government procurement of electric vehicles are concerned.
There have also been regulatory changes in the country, like the dual-credit system. That means automakers will have to speed up electrification and make EVs cost-effective for consumers.