The Wisconsin Economic Development Corp. thinks the state could become a critical epicenter of the global supply chain for electric vehicles.
That’s according to a recently released report in which WEDC proposes six strategies Wisconsin can use to achieve this vision. They include enhancing productivity through automation and upskilling, scaling up the middle-skill workforce pipeline, building connections between innovators and industry, aligning EV policymaking with economic development interests, and preparing for the future of mobility and sustainability.
With the caveat that there is still much work to be done in the areas of workforce development and incentivizing innovation, some Wisconsin companies are also optimistic in the opportunities that lie ahead for manufacturers of EV parts and components.
Specialty vehicle manufacturer Oshkosh Corp. has already introduced patented electrification technology within all of its businesses, and the company has no plans to slow down its electrification efforts. Its recent innovations include the Pierce Volterra fire truck; the Oshkosh Striker Volterra ARFF hybrid EV; a fully integrated, electric refuse collection vehicle; and the Next Generation Delivery Vehicle for the U.S. Postal Service.
“Growth opportunities are always driven by shifts and movements in society. We position ourselves in front of these trends,” the company said in a statement. “Electrification is a trend we have been watching for quite some time, and we continue to see accelerated adoption and growing demand for electrified solutions. Oshkosh will continue to advance our technological capabilities in this area to bring industry-leading solutions to our customers that enhance performance, improve safety and lower total cost of ownership, while bringing sustainability benefits to communities around the world.”
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Glendale-based Clarios supplies its advanced, low-voltage battery technologies to some of the biggest automakers in the world.
The increasing electrification of vehicles has driven a rapid shift toward advanced batteries to support “next-generation vehicles,” those powered by something other than a traditional internal combustion engine powertrain without electrification technology, according to a registration statement filed by Clarios with the SEC. The company anticipates advanced batteries will be about half of all low-voltage batteries sold by 2035.
Clarios has a strong relationship with almost all of the automakers that are working to build out the impending EV revolution, said Craig Rigby, vice president of technology.
“What we’ve found in working with automakers is the role our battery plays is different and even more critical (in EVs). For us, it’s brought in new requirements and new ways of thinking,” said Rigby.
While the U.S. is still in the early stages of fully adopting EVs, he believes the Midwest has been and will continue to be a hotbed for not only vehicle production, but specifically EV production. Key to this happening in Wisconsin will be organizations like WEDC helping drive technology innovation, he said.
Rigby pointed to companies like Milwaukee-based COnovate Inc. of which he is a board member. COnovate created a new material called “Cophite,” which specifically boosts the capacity and charging speed of lithium-ion batteries.
Rigby believes innovations like this being born in Wisconsin will eventually make their way into the next generation of EVs and the state should continue to incentivize such work.
Milwaukee-based Rockwell Automation also sees growing opportunities in the EV space as some of the manufacturing processes used to create the vehicles become more complex. Rockwell specializes in industrial automation and digital transformation products.
During a recent earnings call, chairman and chief executive officer Blake Moret said the company has several solutions that could become integral to the EV manufacturing process.
“The net opportunity for Rockwell actually goes up as we go from internal combustion engines to EVs. That’s for a couple of reasons,” said Moret. “First, the traditional drivetrain operations, that’s a more subtractive manufacturing process. That’s boring cylinders, that’s finishing metal surfaces and things like that, and that’s largely done with computer numerical controls, which is not technology that Rockwell directly has. We have good partnerships, but it’s not something that we provide directly. When that’s replaced with some of the operations in electrical vehicles, most notably the battery formation and packing and assembly, that’s more of an assembly-type operation and there’s aspects at the front end of that with batch processes and those are all applications that Rockwell has great readiness to serve.”
Federal guidance pushing EVs forward
A catalyst in the shift toward EVs are new air emission standards being proposed at the federal level.
The Biden administration recently proposed strict new automobile pollution limits that would require at least 54% of new vehicles sold in the U.S. to be electric by 2030 and as many as two of every three by 2032.
This proposal has drawn mixed reactions from Wisconsin manufacturers.
“No, I don’t think it’s a reasonable goal,” said Austin Ramirez, chief executive officer of Waukesha-based Husco, a manufacturer of hydraulic and electro-mechanical components for automotive and off-highway applications.”
“I think it’s a good thing to always have more stringent air emission standards, I think that forces innovation and it’s good for the environment,” Ramirez said. “I think taking the technology and subsidizing specific things like electric vehicles is a bad way to get there.”
He sees several more immediate issues at play if the U.S. wants to truly and fully adopt EVs. Those issues range from infrastructure issues, problems with the electric grid and problems with sourcing the raw materials needed to make EV components.
When it comes to how the state can immediately help Wisconsin manufacturers begin the switch to making EV parts, one key strategy in the WEDC report has Ramirez’s support: increasing automation and upskilling.
Focusing on technical education to have a strong supply of incoming workers and creating a low tax environment for manufacturers looking to grow in the state are also important.
“Every company that is a supplier to the automotive industry today has to think about how they transition their product portfolio to be relevant in the electric vehicle world. The challenge in Wisconsin is how do we help our small and medium-sized manufacturers adapt,” said Ramirez.
Rigby has a more hopeful outlook on looming deadlines related to air emissions and EVs. While calling some of these goals ambitious, he does believe they could be completed if the government continues to support manufacturers transitioning to making EV components and incentivize consumers looking to buy an EV.
Also, if the majority of all cars in the U.S. will eventually be electric, Rigby said the bulk of the raw materials being used to manufacture the vehicles will need to come from within the U.S. as opposed to other countries like China.
“I think it is achievable but there are significant challenges,” said Rigby. “I think the (Biden) administration has a smart approach to how they’re trying to take this on.”