The electric vehicle (EV) industry is in a constant state of flux. From evolving EV mandates by the U.S. government to the limited raw material supply for EV battery production to the challenges of EV battery recycling, auto recyclers who are gearing up to recycle EVs and their components are facing an ever-evolving future.
In late May, the U.S. Senate passed a measure eliminating California regulations that would have required a 100 percent transition to electric vehicles for new car and truck models in by 2035. As of 2023, 17 states chose to mimic California’s standards.
Mike Stonecipher, group manager for strategy and leadership development with Georgia Manufacturing Extension Partnership (GaMEP) at Georgia Institute of Technology, has done extensive work in the EV and auto industries.
In light of the recent EV mandates, Stonecipher said car manufacturers in the U.S. and Europe are backing off from EV production plans due to a slower growth rate than expected, plus a change in EV policies from the new administration. In addition, range anxiety, charging infrastructure availability/reliability, and price remain the top concerns for consumers.
“Material cost, supply chain instability, and the cost to retool for a shaky market are what the OEMs are struggling with to justify additional investments to scale for EV production,” Stonecipher said. “Therefore, the consumer trend has shifted to plug-in hybrid electric vehicles that share the benefits of EV and ICE vehicles.”
As Stonecipher explained, the current theme for OEMs is reshoring (now called regionalization) and retooling. Recent events, such as tariffs, unpredictable geopolitical pressures, and unreliable sources, have caused OEMs to rethink their supply chain.
However, according to Lea Malloy, assistant vice president of EV battery solutions at Cox Automotive, while tariffs, regulations and the possible elimination of federal incentives could impact EV adoption growth, research indicates that growth will continue, albeit slower than originally anticipated. Cox Automotive estimates a 12 percent increase year over year in new EV sales in 2025.
“In fact, over the next two years, we’re expecting to see more than 39 new models launched across thousands of dealers,” Malloy said.
While EVs differ from internal combustion engine (ICE) vehicles, they are subject to many of the same challenges as ICE in a new tariff environment including higher prices and ultimately reduced production.
“On the positive side, EVs have fewer parts than their ICE counterparts. However, the most expensive component remains the EV battery pack,” Malloy said. “We also know EV price parity with ICE is a signpost the industry is watching to usher in mass adaption – and tariffs can strain that equation if the vehicle is not produced domestically. The good news is we are seeing a growing number of EVs produced domestically.”
EV owners tend to be incredibly loyal. Malloy points to a study by the Global EV Alliance that found that 92 percent of EV owners said they wouldn’t go back to driving a gas-powered car. This is a strong indicator that the EV market continues to gain momentum – even as overall vehicle production slows.
As auto recyclers continue to gear up and get trained in the nuances of EV recycling, what could a slowdown in EV manufacturing mean for them?
“EV recyclers are in a tough predicament. Battery chemistry continues to change as OEMs balance material cost, material availability, and battery performance,” Stonecipher said. “Power density is better with lithium-ion cobalt technology, but lithium-ion iron technology provides a more economical solution. In addition, we are now starting to see more interest in lithium-ion magnesium phosphate technology. All these batteries use electrolyte technology, which will probably be replaced in the near future with solid state technology. This makes it difficult to make capital intensive investments in recycling.”
Malloy added that the EV battery recycling industry is in early innings and volumes are primarily driven by production scrap versus end-of-life EV batteries. “Continued innovation and patience is required to test and commercialize optimal ways to safely recycle EV batteries for the creation of new EV battery cells. Government funding and regulation can be the industry’s biggest accelerants, even if we experience a potential slowdown in EV manufacturing,” Malloy said.
Grant Ray, vice president of global market strategy at Group14, an American manufacturer and supplier of technology for rechargeable lithium-silicon batteries, said that while there is a level of uncertainty in all global manufacturing right now, we’re still bullish on EVs.
“For example, according to the latest IEA report, electric car sales in 2025 are expected to exceed 20 million globally. That’s more than one-quarter of cars sold worldwide,” Ray said. “We see the global EV market is still growing, not slowing down. The early recyclers will be better positioned to lead as volume continues to ramp up, especially when second-life use cases for battery storage at both cell and EV pack levels become more standardized.”
The EV Battery Conundrum
Production and manufacturing issues aside, EV batteries and their recyclability are still creating a myriad of issues for automotive recyclers. Electrical hazards and fires are the main concerns, as damaged batteries can create a short circuit, which become a fire hazard.
“The battery chemistry which uses organic solvents is also highly volatile and can easily ignite,” Stonecipher explained. “Special controls and fire protection are needed to prevent fires and to extinguish a fire. If not fully discharged, these batteries can be lethal. Same safety precautions should be taken as if one is working on a powerline.”
Jenny Houlroyd, occupational health group manager for the Safety, Health, Environmental Services (SHES) program at Georgia Institute of Technology, agreed that by far, the biggest challenge that auto recyclers of EV batteries will face is controlling the risk of ignition and fires.
“This risk increases on the recycling side because of the variability in EV batteries from different manufacturers and the potential damage that may have occurred to the batteries from use, exposure to extreme temperatures, exposure to extreme moisture, or automobile accidents,” Houlroyd said. “When storing large amounts of EV batteries awaiting recycling, the damage from any thermal runaway – where a battery can experience uncontrolled increases in temperature and pressure – could lead to exponential expansion of the event if the batteries are not appropriately isolated from each other.”
Beyond this primary risk, as with any battery recycling that is being conducted to recover precious metals, Houlroyd said auto recyclers working in and around these processes have an increased risk of exposure to metals in the form of dust and fumes. In particular, the release of cobalt and nickel in EV batteries can lead to asthma, pulmonary fibrosis and cancer. Additionally, exposure to manganese in the form of fumes can lead to neurological disorders, with symptoms like Parkinson’s disease.
“Controlling these hazards will require excellent housekeeping procedures, ventilation systems that control exposures and extensive industrial hygiene programs (air sampling, training, respiratory protection, medical surveillance) to monitor and control exposures,” Houlroyd said.
Houlroyd stressed that the most significant need right now is for safety and health professionals and auto recycling industry experts to work together to develop different types of training about hazards related to the recycling of EV batteries for the various stakeholders and come up with strategies, following the hierarchy of controls, to ensure that workers are protected long-term from chronic health risks.
“I learn something new about the health and safety risks of recycling every time I conduct an industrial hygiene survey at a recycling plant. These collaborative conversations and partnerships are necessary to approach the challenges with curiosity and a proactive approach,” Houlroyd said. “All parties need to be involved in the conversation – from the EV owner, the dealerships selling new and used cars, the maintenance shops working on the batteries, and waste management services that may receive the batteries to be sent to recycling plants.”
Performing EV battery recycling in a manner that protects the workers, and the environment will be an expensive investment. Houlroyd often reads that mining is still cheaper than recycling.
“Economic comparisons of the costs associated with EV battery recycling versus the cost of mining virgin materials often do not incorporate the societal costs associated with workers developing a range of types of pneumoconiosis from mining these metals, or the long-term environmental consequences,” Houlroyd said. “One policy recommendation would be to find ways to fund research into improving the efficiency and safety surrounding the recycling of batteries, and then financially support the investment in the construction and maintenance of recycling plants designed to protect workers’ safety and health.”
In 2023 the EU passed a rule targeting the efficiency of recycling of EV batteries. This regulation EU 2023/1542 could serve as a model for the U.S.
“The biggest challenge here is that the European Union has this falling under its broad ‘European Green Deal,’ which, given the political climate here in the U.S. and the optics of the Green New Deal stateside, I am not sure how receptive looking at this rule as a model would be in the U.S.,” Houlroyd said.
While batteries used in EVs can come in several chemistries, sizes and packaging formats, Group14 doesn’t make batteries – the company manufactures and supplies advanced silicon battery material for battery applications ranging from EVs and BEVs, to AI-enabled smartphones, data centers, and eVTOLs.
“We’re excited about the arrival of “forever batteries” – high-performing, long-lasting and capable of multiple lives across applications,” Ray said. “Longer lasting, higher performing batteries remain viable longer in vehicles and retain more value when repurposed for stationary storage, expanding the possibilities for reuse.”
As Malloy further explained, when charged, EV battery packs store a significant amount of energy, making it essential to remove and store them in a secure location before any processing can begin.
“In many cases, batteries must be transported and depowered prior to recycling – steps that add both cost and logistical challenges, especially when the battery’s condition is unknown,” Malloy said. “Additionally, EV battery packs and cells vary widely in design, requiring specialized knowledge for safe removal and disassembly. This variability increases the risk for processing teams and underscores the need for targeted training and safety protocols.”
Due to the industry’s lack of standardization, training, processes and preparation for EV battery recycling can vary significantly.
“Regulatory frameworks are still evolving – both in the U.S. and internationally,” Malloy said. “Different regions are adopting distinct approaches to handling, transporting, and processing EV batteries, which adds complexity to compliance and training efforts.”
Published July 2025