Homegrown power: U.S. LFP supply could spark cheap EVs

In line with President Donald Trump’s protectionist policies, as well as his predecessor Joe Biden’s affinity for strengthening U.S. manufacturing and local supply, companies are making efforts to establish a domestic electric vehicle (EV) supply chain.

As it happens, the U.S. is trying to position itself as a significant competitor to China in various aspects of EV production, to which end powder metals supplier GKN Hoeganaes and mineral development company First Phosphate signed a strategic partnership, according to a report by Automotive World on February 27.

Benefits of the U.S. LFP supply

Indeed, the partnership, established in November 2024, aims to deliver a world-first North American supply for lithium-iron-phosphate (LFP) batteries in a push to challenge China’s dominance and bring cheaper EVs to market. They have opted for LFP for a number of reasons.

The first is the affordability of their constituent raw materials, followed by high cycle life and low risk of overheating. However, much of the raw materials supply for LFP is in Asia and is controlled mainly by China, stressing the need for a sustainable and domestic LFP supply chain.

Meanwhile, iron phosphate comprises more than 80% of the cathode in an LFP battery, making onshoring its supply a strategic priority. In the words of Matthias Voss, Senior Vice President of GKN Hoeganaes, there is “no capacity in North America right now, and it is much the same in Europe. The supply chain for this compound really needs to be built from scratch.”

Additionally, China itself may not necessarily be able to meet international demand much longer and might soon hit capacity due to its exponential domestic sales growth, forcing it to turn to other regions to secure the material for its own manufacturing.

Innovations in LFP supply

As Voss explained, “We developed a means of using the magnetite that helps First Phosphate avoid large amounts of waste material in its own process.” As he added, while other global players can generate iron powder, the “devil is in the details,” and the biggest challenge is purity, which can have a tangible impact on battery performance.

Notably, prior to this partnership, GKN, an established player in the field of iron powder, carried out a successful integration of First Phosphate’s magnetite (FP being the same in the phosphoric rock sector) into its melting process, leading to the development of a high-purity iron powder for implementation in EV batteries.

The companies are also looking to recover used iron from batteries at the end of their useful life, which Voss characterizes as “the second stage of the journey” thus possibly solving most procurement issues. For the time being, however, this process is more expensive and inefficient than mining.

At the same time, the potential innovations with huge implications for the EV industry keep stacking up, including the discovery of sodium-ion cathodes to replace lithium, and automotive giants BMW and Volvo introducing the super-powerful 800V batteries to cut down charging times and increase range.