Australian governments and companies have announced numerous battery manufacturing projects over the past three years. Cell manufacturing, module assembly, battery recycling, precursor chemicals—billions in proposed investment creating thousands of promised jobs.

If you’ve been following Australian manufacturing policy for the past 20 years, this feels eerily familiar. We heard similar announcements about solar panel manufacturing in the 2000s and early 2010s. That didn’t end well.

The Announcements

Since 2023, major battery manufacturing announcements include:

• Alpha HPA: Alumina production for battery separators, Gladstone QLD
• Magnis Energy: Battery cell manufacturing, Townsville QLD
• RECHARGE Industries: Lithium-ion cell manufacturing, Geelong VIC
• Neometals: Lithium refining and battery recycling, Kalgoorlie WA
• Multiple cathode active material (CAM) and precursor chemical projects

Total announced investment exceeds $5 billion. Projected employment runs into thousands. Timelines suggest production commencing 2025-2027.

Yet here we are in March 2026, and actual operating capacity remains minimal. Most projects are delayed, scaled back, or struggling to secure final funding commitments.

The Solar Parallel

Australia developed world-leading solar photovoltaic research at UNSW and other institutions during the 1980s-2000s. Martin Green’s research group at UNSW achieved multiple world-record solar cell efficiencies.

That research leadership didn’t translate to Australian solar manufacturing. Attempted solar manufacturing ventures—including BP Solar in Sydney and various other initiatives—all failed or relocated overseas.

Today, Australia imports essentially 100% of solar panels from China and Southeast Asia. Chinese manufacturers took Australian research, scaled it with government support and cheap capital, and now dominate global markets.

According to Australia’s Chief Scientist quarterly reports, this pattern—research strength, commercialization weakness—repeats across multiple technologies. It’s not specific to solar.

Why Battery Manufacturing Is Difficult

Making batteries at scale is genuinely hard. It requires:

Specialized equipment: Battery cell manufacturing uses complex automated production lines that cost hundreds of millions. Equipment suppliers are primarily Asian firms with long lead times and limited production capacity.

Technical expertise: Battery manufacturing requires specialist knowledge of electrochemistry, materials science, process engineering. That expertise is concentrated in companies that’ve been doing this for decades—primarily Japanese, Korean, and Chinese firms.

Supply chain integration: Batteries require precursor chemicals, active materials, separators, electrolyte, copper and aluminum foils, specialized coatings. These supply chains are predominantly Asian. Building them from scratch in Australia faces economic and technical challenges.

Scale economics: Battery manufacturing economics improve dramatically with scale. Small 1-2 GWh plants struggle to compete with 20-50 GWh megafactories in Asia. Reaching competitive scale requires billions in capital investment.

Established competition: You’re competing against CATL, LG Energy Solutions, Samsung SDI, BYD—companies that’ve invested decades and tens of billions building capability. They have better technology, cheaper costs, established customers, and deep pockets for price competition.

Why Announcements Stall

Most Australian battery manufacturing announcements follow a pattern:

1. Initial announcement with government attending, emphasizing jobs and strategic capability
2. Securing initial government grant or loan commitment
3. Attempting to raise private capital to match government funding
4. Discovering that private investors are skeptical about project economics
5. Delays while attempting to secure equipment, supply agreements, customers
6. Scaled-back project scope or indefinite postponement

The problem is project economics rarely stack up without sustained government subsidy or protection. Import competition from established Asian producers makes profitability difficult.

Private investors understand this. Government capital can fund partial project development, but scaling to commercial production requires private co-investment that’s difficult to attract.

What Would Need to Change

For Australian battery manufacturing to succeed requires addressing structural disadvantages:

Sustained government support: Not just grants for project development, but ongoing production subsidies, preferential procurement, or trade protection to offset cost disadvantage versus imports. Think US Inflation Reduction Act-style interventions, not one-off project grants.

Integration with domestic demand: Battery manufacturing makes more sense as part of broader EV or energy storage manufacturing. Making cells for export when customers can buy cheaper from Asia is difficult. Making cells for Australian EV assembly or grid battery projects creates captive demand.

Specialization in niches: Rather than competing directly with Chinese megafactories on commodity cells, focus on specialized battery chemistries or applications where Australian capability could differentiate. Sodium-ion batteries, solid-state development, specialty industrial batteries—areas where incumbents don’t have overwhelming advantage.

Research commercialization: Actually convert Australian battery research (which is strong) into commercial ventures. That requires fixing broader deep tech commercialization challenges discussed in quantum computing context—patient capital, specialized venture funding, government procurement.

None of these are happening at necessary scale. Government support remains fragmented and insufficient to offset structural disadvantages. Deep tech commercialization challenges persist. Domestic demand for batteries exists but isn’t integrated with manufacturing strategy.

The Honest Assessment

Most announced Australian battery manufacturing projects probably won’t deliver at proposed scale, if they deliver at all. A few might survive in niche applications or with ongoing government subsidy. Most will scale back, relocate, or quietly dissolve.

That’s not to say Australia should abandon battery manufacturing entirely. Strategic capability in critical technology supply chains has value beyond pure economics. Energy security, supply chain resilience, technology sovereignty—these justify some level of government support for domestic manufacturing.

But let’s be honest about what that requires. Either:

Accept economic subsidy: Acknowledge that Australian battery manufacturing won’t be globally cost-competitive without sustained government support, and budget accordingly. That means ongoing production subsidies of potentially hundreds of millions annually.

Or:

Pursue niche specialization: Focus on specific battery types or applications where Australia could actually compete, rather than trying to build commodity lithium-ion cell manufacturing to compete with Chinese megafactories.

The current approach—announce projects, provide limited initial funding, hope private investment and project economics work out—is unlikely to succeed based on historical evidence across multiple technology sectors.

Learning From Mistakes

The solar manufacturing failure offers lessons:

• Research excellence doesn’t automatically convert to commercial manufacturing
• Competing against established Asian producers requires sustained competitive advantage, not just capability
• One-off project grants don’t create sustainable industries
• Scale matters enormously—small boutique operations can’t compete on cost
• Domestic market protection or guaranteed demand helps nurture early industry

If Australia’s serious about battery manufacturing, policy needs to reflect these lessons. That means long-term strategic commitment with appropriate funding and support, not announcement-driven politics.

Without that, we’ll have another round of failed manufacturing initiatives to add to the list alongside solar, automotive, and various other sectors where announcements exceeded delivery.

The battery manufacturing opportunity is real—global demand is enormous and growing. But capturing that opportunity requires more than press releases and initial grants. It requires sustained strategic commitment that Australian policy-making historically hasn’t demonstrated.

Let’s see if this time is different. But don’t bet on it.