US imports of lithium-ion batteries for electric vehicles reached new heights in the second quarter as the Biden administration proposed higher tariffs on Chinese EV batteries and related goods.

Second-quarter EV battery shipments to the US rose nearly 26% from a year ago to 42,945 metric tons, according to the S&P Global Market Intelligence Global Trade Analytics Suite. That was 10.2% more than in the first three months of 2024, the previous quarterly high for US EV battery imports.

The imports, largely from China, grew despite a sales slowdown for all-electric models and the US Trade Representative's delay of a determination that could ratchet up tariffs on solar, EV and battery shipments from China under Section 301 of the Trade Act of 1974.

The Trade Representative, which is within the Executive Office of the President, "continues to work to finalize the determination, and we intend to make it public in the coming days," the agency said in an Aug. 30 statement. In July, the trade agency said it expected to issue its determination in August. The tariff rate on lithium-ion EV batteries would increase from 7.5% to 25% in 2024, as proposed, and make the same jump for lithium-ion non-EV batteries in 2026.

In proposing the tariff rate hike in May, the White House argued that stricter measures were needed to protect domestic producers from "unfairly priced" imports.

Total US lithium-ion battery imports, including for EVs, energy storage systems and other applications, hit 191,274 metric tons in the second quarter, rising 14.4% from a year ago but retreating 4.5% from the first three months of 2024, according to the Global Trade Analytics Suite, which relies on data reported to the US Census Bureau.

Global battery-makers build US factories

China accounted for 82.2% of lithium-ion battery imports in the second quarter of 2024, down from its 84.5% share in the first three months of the year. Japan tallied 4.1%, followed by Hungary with 3.4% and South Korea with 3%.

Among the most prolific battery shippers in the second quarter were China's Contemporary Amperex Technology Co. Ltd. (CATL) and Tongcheng Guoxuan New Energy Co. Ltd. and South Korea-headquartered LG Energy Solution Ltd. and Samsung SDI Co. Ltd., according to data collected by Panjiva.

Global battery-makers are also leading a major buildout of US factories, harnessing lucrative incentives in the 2022 Inflation Reduction Act. A recent S&P Global Commodity Insights forecast estimates that LG Energy Solution, SK Innovation Co. Ltd. and Panasonic Holdings Corp. will emerge as the top three operators of US battery cell manufacturing capacity by 2030. Texas-based Tesla Inc., which has a battery joint venture with Panasonic in Nevada and plans to expand production of its own battery cells, ranks sixth.

Ford Motor Co. intends to produce EV batteries at a factory in Michigan using technology licensed from CATL.

US battery manufacturing capacity, including non-lithium technologies, is anticipated to grow from 93 GWh in 2023 to 603 GWh in 2027 and 1,169 GWh in 2030, according to the Commodity Insights forecast. That would boost the US share of anticipated global battery production capacity to 16% by 2030, up from 4% in 2023. China's share, at 78% in 2023, is forecast to fall to 58% by the end of the decade.

Panjiva is the supply chain research unit of S&P Global Market Intelligence, a division of S&P Global Inc.