Supply Chain in Electric Vehicles: The Geopolitics of Critical Components

The growth of the electric vehicle (EV) market is transforming not only consumer behavior but also the global industrial infrastructure. Carbon neutrality targets, sustainability regulations, and energy efficiency policies are among the key drivers accelerating this transformation. The automotive sector is moving away from traditional internal combustion engines, and this shift is redefining not only energy sources but also supply chains, investment priorities, and industrial competition—forcing countries to rethink their industrial strategies.

The growth of the electric vehicle (EV) market is transforming not only consumer behavior but also the global industrial infrastructure. Carbon neutrality targets, sustainability regulations, and energy efficiency policies are among the key drivers accelerating this transformation. The automotive sector is moving away from traditional internal combustion engines, and this shift is redefining not only energy sources but also supply chains, investment priorities, and industrial competition—forcing countries to rethink their industrial strategies.

However, this transformation relies on a complex network of components that go far beyond the term “electric,” creating an entirely new component ecosystem across the production value chain. This compels nations to reconfigure their industrial strategies, supply security approaches, and technology investments.

So, what are the most critical components an EV manufacturer must source externally? The answer to this question can guide decisions in areas ranging from technology policy to industrial strategy.

The Heart of Production: 10 Key Externally Dependent Components

One of the decisive competitive factors in EV production today lies in the question: “Which parts do you source, where, and how?” Below are ten components that EV manufacturers still largely source externally, all of which hold strategic significance for domestic production. The ranking was created based on criteria such as cost impact, dependency levels, EV specificity, technology barriers, and production potential in Turkey. It not only highlights today’s supply chain risks but also points to tomorrow’s investment priorities:

• Battery Cells and Modules: The foundation of EV architecture, determining everything from range to cost. The largest cost component of the vehicle. Global dominance lies with Chinese and South Korean firms such as CATL, BYD, and LG Energy.

  

• Battery Management System (BMS): Software-hardware integration managing cell health, temperature, voltage balance, and safety. Critical for battery lifespan, efficiency, and security.
• Inverters and Converters: Manage energy flow, ensuring efficient operation of both motor and battery. Requires deep expertise in power electronics.

  

• Electric Motors: The heart of performance and energy conversion, heavily dependent on strategic raw materials for magnets and coils.

  

• Power Electronics Modules: Regulate in-vehicle power distribution and high-voltage control, incorporating various subsystems including thermal management.
• Thermal Management Systems: Ensure batteries and motors operate at optimal temperatures, critical for safety and efficiency.

  

• Electronic Control Units (ECUs): The brain of all electronic subsystems within the vehicle, with both EV-specific and traditional automotive features.
• Telematics and Connectivity Units (TCUs): Essential for connected vehicle concepts, enabling data communication, fleet management, and driver-assistance systems.

  

• Charging Devices & Infrastructure (EVSE): Includes home and DC fast charging solutions, strategically significant for both automakers and national infrastructure/energy policy.

  

• EV-Specific Tires: Designed for quiet driving, low rolling resistance, and high torque. Specialized production remains reliant on expert suppliers.Bu Liste Neden Önemli?

Why This List Matters

Though some may seem minor, these components represent the majority of total vehicle costs and require heavy know-how and R&D investment. Their external sourcing provides a direct indicator of a nation’s domestic production capacity within the EV ecosystem. Beyond industrial policy, supply security, geopolitical risks, and critical raw material strategies all play decisive roles.

Implications for Domestic Industry

For countries like Turkey, which already have a strong automotive manufacturing heritage, this list serves as a roadmap. If these strategic components can be developed domestically and produced at global standards, it would not only reduce current account deficits but also foster technology transfer and expand skilled labor. R&D centers, technoparks, and venture capital funds established in this direction play a crucial role in paving the way for startups aiming to localize these components.

BSG - Sinerji GSYF & SOF - İstanbul Sanayi Odası GSYF

At Boğaziçi Ventures, we invest in initiatives that aim to merge Turkey’s industrial power with advanced technology. Within this vision, we launched the Sinerji GSYF, which provides capital support to local startups operating in mobility, energy, production technologies, and sustainability. In the same strategic framework, our collaboration with the Istanbul Chamber of Industry (ISO GSYF) supports technology-driven projects that enhance Turkey’s industrial competitiveness, helping scalable and globally oriented ventures thrive. Both funds contribute to the development of a new-generation industrial infrastructure in Turkey by supporting startups that add value to the domestic production ecosystem.

About Boğaziçi Ventures

For over a decade, we have been dedicated to contributing to and creating value within Turkey’s technology entrepreneurship ecosystem. During this period, we have leveraged our deep expertise and strong business network to support entrepreneurs. At Boğaziçi Ventures, we believe in shaping our investments by harnessing the power of technology across multiple verticals to deliver sustainable and intelligent solutions.

We invite entrepreneurs to apply for investment discussions via [email protected] . Take the opportunity to grow your technology venture and join our global network today!