The drive toward sustainability is taking center stage across several industries and, most importantly, in the mobility and automotive sector. To curtail greenhouse gas emissions from tailpipes, several developed countries around the world are setting targets for transitioning to zero-emission and sustainable transportation alternatives such as electric vehicles (EVs). The federal governments in these regions are also providing tax subsidies, incentives, and other initiatives to customers and auto original equipment manufacturers (OEMs) to promote domestic EV manufacturing and sale. Empowered by subsidies and incentives, most of the globally established auto OEMs are ramping up production and introducing a range of EVs at various price points, accessible to every consumer.
With widescale EV manufacturing, the auto industry value chain is under a major transition and is displacing some of the traditionally established supply chain channels and stakeholders with several new and emerging vendors. A new race is brewing between auto organizations and federal governments to forge partnerships and establish a value chain for sourcing rare earth materials and technology for battery tech, microchips, and power electronic hardware. These governments are also heavily investing and promoting these vendors to ramp up domestic production. However, these investments would require an extended period to mature and yield returns. Until then, there will be a high dependency on overseas vendors to source the necessary technology and cater to domestic demand.
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