Stanley Black & Decker shifts sourcing strategy as battery demand grows – Supply Chain Dive
Lithium producers and battery makers have struggled to match production to the soaring demand from electric vehicle makers and other companies that depend on the metal for rechargeable batteries.
Chemicals company Allkem saw spot prices of lithium chemicals reach “new records” following supply deficits due to skyrocketing demand in China, Chief Sales and Marketing Officer Christian Cortes told analysts last month.
“It’s a very, very tight supply market and as result of this we are seeing a very, very rapid increasing pricing,” he said.
Energizer said it plans to raise battery prices after confronting high costs for lithium and other raw materials. The battery maker will also keep an elevated safety stock for the “foreseeable future” as labor challenges and issues sourcing raw materials continue to make supply volatile, President and CEO Mark LaVigne told analysts Feb. 7.
A rapid expansion in industries electrifying their products pushed Sunlight Group Energy Storage Systems, a global producer of industrial batteries, to expand investment in lead recycling methods. The company is also looking at ways to recycle lithium.
“We are investing in new product lines and increasing capacity across our plants in Europe and North America to meet this demand,” Todd M. Sechrist, CEO and President of Sunlight Batteries USA, said in an email.
Stanley Black & Decker is also investing in innovation to add capacity — the company’s venture capital arm contributed to a $5.7 million investment funding round for 3-D lithium ion battery company Prieto Battery in August, according to a press release.
The company also introduced a power stack battery system in November using lithium-ion pouch cells instead of cylindrical cells, which are in higher demand because of their use in automobiles, CEO Jim Loree said during the company’s Q3 earnings call. Innovation projects worth approximately $200 million are also currently in the works.
“We are continuing to invest in innovation, manufacturing, automation, inventory, and our supply chain to meet the strong demand in the near-term and fuel sustainable growth over the medium and long-term,” Loree told analysts this month.
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Leveraging coastal holding facilities and shifting to a market delivery model are two pillars in the company's strategy, said Don Frieson, EVP of supply chain.
Adequate coolant, neon and argon supply are the next concerns for chip production, experts said.
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Topics covered: logistics, freight, operations, procurement, regulation, technology, risk/resilience and more.
Leveraging coastal holding facilities and shifting to a market delivery model are two pillars in the company's strategy, said Don Frieson, EVP of supply chain.
Adequate coolant, neon and argon supply are the next concerns for chip production, experts said.
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