Companies and the U.S. government are shelling out billions of dollars to establish a supply chain for batteries in North America, a manufacturing effort that is critical to the auto industry’s long-range plans to put more electric vehicles on the road.

Batteries are the most expensive component in an electric vehicle, accounting for about one-third of its cost, reports The Wall Street Journal (Feb. 7, 2023).

Lithium, produced at this site in Nevada, is among the minerals that are crucial battery components.

American electric-car makers traditionally haven’t assembled batteries themselves. They rely on a far-flung supply chain. The raw materials are mined primarily in countries such as Australia, China, Congo and Indonesia. Chemical processing, battery components and assembly are mostly done by Chinese companies.

A recently passed law provides incentives for North American-built batteries and penalizes car companies that source batteries abroad, is spurring a wave of new projects in the U.S.—from cell-making factories to new ventures to mine the raw materials.

Oxford economist Bent Flyvbjerg is an expert in the planning of “megaprojects,” huge efforts that require at least $1 billion of investment: bridges, tunnels, office towers, airports, telescopes, the Olympics. He’s spent decades studying the many ways megaprojects go wrong and the few ways to get them right. His new book How Big Things Get Done, is summarized in The Wall Street Journal (Feb. 4-5, 2023).

Spoiler alert! Big things get done very badly. They cost too much. They take too long. They fall too short of expectations too often. This is what Flyvbjerg calls the Iron Law of Megaprojects: “over budget, over time, under benefits, over and over again.”

His work can be distilled into three pitiful numbers:

• 47.9% are delivered on budget. 
• 8.5% are delivered on budget and on time. 
• 0.5% are delivered on budget, on time and with the projected benefits.

The Guggenheim Museum in Bilboa Spain is a rare example of proper project planning

Flyvbjerg found that the complexity, novelty and difficulty of megaprojects heighten their risk and leave them vulnerable to extreme outcomes.  “You shouldn’t expect that they will go bad,” he says. “You should expect that quite a large percentage will go disastrously bad. Despite the fact that trillions of dollars had been spent around the world on such projects, nobody knew if they stayed on schedule or budget.”

McDonald’s has a new Texas restaurant with no tables or seats or bathrooms for customers and a conveyor belt that routes food to drivers who order ahead. Chipotle also offers no place for customers to sit inside an Ohio restaurant that only takes digital orders. Taco Bell is evaluating a new design that features 4 drive-through lanes, double the typical two. Starbucks,  which long described itself as a “third place” for customers to gather after home and work, plans to add 400 U.S. stores with only delivery or pickup service in the next 3 years.

Taco Bell is testing a 4-lane drive through in Minnesota

America’s biggest restaurant companies made a bet during the pandemic that you would rather eat the food cooked on their premises someplace else. Now they are gambling you will want to do so for years to come. The strategy from these giant chains is to orient their operations around drive-throughs and online ordering while testing new restaurant concepts that only serve food to go, reports The Wall Street Journal (Jan.28-29, 2023). They say these designs will make them more profitable and efficient since restaurants that bring fewer customers inside cost less to build, maintain and staff.