It hasn’t been a good week for German automakers or the European auto industry. First, a top court on Tuesday paved the way for driving bans for diesel cars in German cities. Then Bosch, the world’s biggest automotive supplier, threw in the towel on developing its own battery cells, saying the investment would be too risky. With other European battery startups years behind, that leaves a crucial component of electric cars to Asian or US players such as Samsung, Panasonic, BYD and Tesla.
Bosch said it was ending its research into cell technologies and would dissolve its LEAP joint venture for lithium-ion technology with Japanese partners, GS Yuasa and Mitsubishi Corp. It will also sell US start-up Seeo Inc., which it acquired in 2015 to enhance its expertise in next-generation lithium-ion batteries.
Bosch’s decision will disappoint European politicians, who want to reduce the current dependency on Asian manufacturers and boost local production that can compete with Tesla’s Gigafactory, a joint venture with Panasonic based in Nevada. It will cost $5 billion to build and reach full production capacity of 35-gigawatts in batteries by 2020.