The US government’s recent announcement to invest US$5 billion in a national electric vehicle (EV) charging network is emblematic of the latest sustainable commercial wave sweeping through the automotive industry worldwide. Another was General Motors’ recent announcement to invest $7 billion in electric vehicles, including the construction of a battery plant in the United States.

Gartner researchers predicted that shipments of electric, battery-electric and plug-in hybrid vehicles will grow at a CAGR of 26% to reach 36 million units by 2030, from 3 million in 2020. However, to hold the auto industry’s commitment to sustainability, the entire supply chain – from battery manufacturing to infrastructure and recycling – needs to rethink just about everything.

“Electric vehicles are transforming the concept of mobility in society,” said Thomas Pohl, senior marketing manager at SAP. “Automotive suppliers are committed to adopting sustainable business models throughout the product life cycle, including batteries. As carbon-free operations become table stakes, leaders will stand out by applying their deep expertise in industry and their advanced technologies to champion sustainable and ethical practices as a new business model for many industries.”

Automotive Networks Redefined

Electric vehicles are literally energizing the competitive landscape of auto suppliers that extends beyond traditional automakers to high-tech giants and startups, as well as other consumer electronics players, hungry for more. a part of this promising future. As suppliers follow the “green line”, new ecosystems have emerged to sustainably build and manage the life cycle of electric vehicle batteries.

One example is Catena-X Automotive Network, an open community of automakers, suppliers and other partners creating common data standards to track environmental, social and governance (ESG) progress across automotive production chains. automobile industry. The idea is to collaborate, often in near real time or in real time, by sharing information over the network.

Tracking and exchanging data throughout the lifecycle of each electric vehicle provides information to guide transparent decision-making from initial battery manufacturing and delivery, through certified teardown and potential reuse . Members are also exploring use cases for traceability, which would help companies track battery components to meet carbon footprint reduction commitments and ethical sourcing regulations while becoming more self-sufficient in manufacturing operations through the recycling of battery components. Plus, with comprehensive information across the entire value chain, automakers and suppliers can quickly find members who can meet rapidly changing demands, source new suppliers, adjust schedules production and other operations, before major threats such as shortages materialize.

The circular economy is reshaping automotive supply chains

Electric vehicles are blurring traditional industry boundaries throughout the automotive supply chain in new ways as they capture vast amounts of data. Connecting charging network information securely, from consumer data to accounting and finance software systems, opens up huge sustainable business opportunities. Retailers can offer discounts to buyers when they charge their car locally. Electric vehicles can operate as virtual power plants using solar photovoltaic energy as a renewable alternative. To better understand the battery life cycle of an electric car, some organizations are building digital twins.

“Connected data from digital twins helps OEMs and suppliers calculate battery health and residual value,” said Johannes Weber, solution manager for SAP E-Mobility. “For example, load histories reveal the level of stress a battery has been under, including trips and stationary use. SAP E-Mobility is a cloud-based solution that captures load totals by location , date, duration and EV. This is the kind of data that can be incorporated into digital twins, supporting sustainable decisions in life, second life and end of life.”

Electric vehicles are among the seismic events that shock the automotive supply chain. Durability starts with the batteries that power the car, but certainly doesn’t end there.

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This also appeared on SAP BrandVoice on Forbes.