The timing could not be more embarrassing for the government as it hosts COP26 for Johnson Matthey
Johnson Matthey, one of the UK’s premier industrial companies and a global leader in sustainable technologies, announced today it is to sell its battery materials business – a key player in supporting the transition to electric vehicles.
The decision effectively kills Britain’s hopes of having a domestic champion in battery technology, a field dominated by Chinese companies such Contemporary Amperex Technology, a goliath which is getting on for 40 times the size of JM.
South Korea also has two big players in Posco and LG while, closer to home, European competitors include BASF of Germany and Umicore of Belgium.
All are significantly bigger than JM
The news comes just six months after JM announced it would invest up to £600m this financial year in both battery materials and in hydrogen technology.
This investment was expected by investors to see the company scaling up its battery materials business.
JM has devised a technology called eLNO (enhanced lithium nickel oxide)
which improves the efficiency of electric vehicle batteries by increasing the
amount of power the battery delivers and by extending its life.
The company announced a partnership in April with Finnish Minerals Group to
to produce cathode materials and had secured a long-term supply deal with Nornickel, the Russian resources giant, for nickel and cobalt.
So the move is undoubtedly something Johnson Matthey.
Adding to the government’s embarrassment is the fact that.
only as recently as May, Kwasi Kwarteng, the business secretary, opened JM’s new state-of-the-art battery
technology centre near Oxford Johnson Matthey.
customers and help drive the mass adoption of electric vehicles, aligned with our vision for a cleaner, healthier world”.
Central to that was building on JM’s existing battery technology and testing Johnson Matthey.
capabilities and accelerating the further development of its eLNO materials for battery electric vehicle applications.
Today’s announcement, which was accompanied by a warning that annual profits will be towards the lower end of market expectations,
Johnson Matthey investors and sent JM shares down by 18% – wiping just under £1bn from the company’s stock market valuation.
Explaining the decision, the company said that following a detailed review ahead of reaching a number of critical investment milestones,
it had concluded that the potential returns from its battery materials business would not be adequate to justify further investment.
It said that, while demand for battery materials was accelerating, so was competition from alternative technologies and other manufacturers.
JM said it had become clear the business was consuming too much money compared with other more established large scale and low-cost producers.