Battery Shortages Lease to Audi e-Tron Production Delays

Building electric cars is harder than it looks.

According to a report last week in the Brussels Times, Audi is delaying the production of its planned E-tron Sportback and slowing production of its E-tron SUV following battery shortages from supplier LG Chem.

The factory that builds the e-tron has cut back from eight hours of production a day to six, and is reported to be planning to cut back from running five days a week to four, leading to a day of unemployment for workers there. The moves would cut production of the long-awaited electric car by 10,000 cars annually, from more than 55,000 to just over 45,000 in 2019, according to the Brussels Times. In the report, Audi declined to comment on the delay.

Many automakers ramping up production of plug-in hybrids and electric cars depend on LG Chem for cells, including Hyundai, Volkswagen, General Motors, Mercedes-Benz, and BMW. LG's dominance in supplying batteries to electric cars gives it power to control prices.

A report last year by Germany's Bild am Sonntag newspaper suggested that LG Chem raised prices on its batteries for the Audi E-tron by 10 percent, leading to the production shortage. Waiting lists for the car in Europe have reportedly expanded from 4-5 months to 6-7 months, as demand has also increased by 15 percent. Audi's Belgian spokeswoman Sofie Luyckx told the Brussels Times, that is "not an exceptional waiting time for an all-new Audi."

At the New York auto show last week, Audi E-tron product manager Matt Mostafaei said that the company has U.S. orders for the car, which is expected to go on sale here in May, but would not specify how many.

The delays could also be impacted by a shortage of the car's electric motors following a strike at the Hungarian factory that produces the motors.

The reports say the introduction of the E-tron Sportback, a smaller hatchback version of the E-tron SUV, has also been delayed from late this year to 2020.

Audi is planning a whole line of electric E-tron models, including the SUV, the Sportback, the e-tron GT sports sedan, a new smaller Q4 E-tron SUV, and reportedly a new E-tron GTR supercar to replace its R8 flagship, according to a new report in British auto journal Car.

If it's going to fulfill all those dreams, the company will need to secure a large and reliable source of batteries and, if these hiccups are any indication, it still might not have that.