Automakers, government agencies and investors are pouring money into battery research in the race to make money from zero-emission electric cars.
As automakers like General Motors, Volkswagen and Ford make bold promises about transitioning to zero-emission electric cars, one thing is becoming increasingly clear: they’ll need lots of batteries. .
Demand for this indispensable division outstripped supply, fueling a global gold rush that sent investors, reputable companies and start-ups racing to develop technology and Build the necessary factory to mass-produce millions of electric cars.
Long regarded as one of the least attractive parts in a car, batteries today have become one of the most exciting parts of the auto industry. The carmakers haven’t changed fundamentally in 50 years and margins have been just right, but the battery industry is ripe for innovation. Rapidly evolving technology reminds us of the dawn of personal computers, cell phones and even cars, and the huge influx of capital has the potential to spawn the next Steve Jobs or Henry Ford.
Wood Mackenzie, an energy research and consulting firm, estimates that electric cars will account for 18 percent of new car sales by 2030. This will do. increased battery demand by 8 times If calculated according to the output of the battery the factory can produce at present. And this is only a conservative estimate. Some analysts think electric vehicle sales will grow much faster.
Automakers are in a fierce competition to find the chemical formula that will produce the most energy at the lowest price and pack it in the smallest package. Last month, GM announced that it would only sell electric cars from 2035. This is seen by policy makers and environmentalists as a turning point. But for many people in the battery manufacturing industry, the company is just declaring the obvious fact.
“It was the most recent statement in a wave of headlines that clearly signaled that electric cars were here,” said Venkat Viswanathan, associate professor, research on electric vehicle battery technology at the University. Carnegie Mellon, said.
The battery manufacturing industry is dominated by companies like Tesla, Panasonic, LG Chem, BYD China and SK Innovation – most of these companies are based in China, Japan or South Korea. But many new players are getting into the game, and investors, sniffing the huge profits at stake, are pouring money into startups they believe are about to disrupt.
“I think we’re in its infancy,” said Andy Palmer, former Aston Martin chief executive and now non-executive vice president of InoBat Auto, a battery-making start-up. “There is more money here than ideas.”
QuantumScape, a Silicon Valley start-up invested by Volkswagen and Bill Gates, is working on technology that could make batteries cheaper, safer, and recharge faster. But the company does not have significant sales, and may fail in production and consumption of batteries. However, investors in the stock market valued the company more than French carmaker Renault.
China and the European Union are pumping government funds into battery technology. China sees batteries as a key factor in its ambitions to dominate the electric vehicle industry. Facing this situation, the Chinese government helped Contemporary Amperex Technology, a battery company partially nationalized, become one of the largest battery suppliers in the world overnight.
The European Union is subsidizing battery manufacturing to avoid dependence on Asian suppliers and keep jobs in the auto industry. Last month, the European Commission, the bloc’s executive arm, announced $ 3.5 billion in funding to support the production and research into battery manufacturing. This is an additional source of nearly $ 73 billion that European governments and automakers have committed to electric vehicles and batteries, according to consulting firm Accenture. Part of the government’s money goes to Tesla as a reward for its decision to build a factory near Berlin.
The United States also plans to strengthen the industry according to the focus of President Biden’s climate change policy and his response to electric cars. During a campaign last year, Biden, who owns a 1967 Chevrolet Corvette, said he was hoping to drive an electric version of the sports car if GM decided to make it.
Several battery manufacturers are in the planning or construction phases in the US, including a GM plant under construction in Ohio with LG, but analysts say federal incentives are for cars. Electricity and battery production will be key to creating a thriving industry in America. Following the advances in technology by government-sponsored researchers and domestic companies such as QuantumScape and Tesla, which last September outlined plans to lower prices and improve car battery performance. electricity.
“It is well known that China is stepping up production and new innovations,” said Margaret Mann, team leader at the Integrated Motion Science Center at the National Renewable Energy Laboratory, a unit of the Department of Energy. US quality, says. “I’m not pessimistic,” she said of the United States’ potential for advancement in battery production. “But I don’t think now that all the problems have been resolved.”
Industry startups say they are in their early days and that American companies can still outpace the Asian manufacturers that dominate the industry.
“The batteries of today are not competitive,” said Jagdeep Singh, chief executive of QuantumScape, a company based in San Jose, California. “Batteries have huge potential and are a decisive factor in the renewable energy economy, but they must get better.”
Overall, all the money that goes into battery technology is good news. That is to actively use capitalism to solve a global problem. But this restructuring of the auto industry will also entail a few victims, like companies that make parts for internal combustion engines, or carmakers and investors that bet the technology wrong.
“Battery renewal isn’t overnight,” said Venkat Srinivasan, director of the Argonne National Laboratory’s Energy Reserve Science Collaboration Center. “It can take years. Anything can happen.”
Most experts are sure that demand for batteries will enhance China’s position, Water for smelting most metals is used in batteries and produces more than 70% of the total cells. And China’s control over battery production will only slip away slightly over the next decade despite ambitious plans to expand production in Europe and the US, according to forecasts by Roland Berger, the company. management consulting in Germany.
Battery production has “deep geopolitical ramifications,” said Tom Einar Jensen, chief executive of Freyr, which is building a battery factory in northern Norway to take advantage of wind and hydroelectricity. abundance of this region, say. “The European auto industry does not want to depend too much on imports from Asia in general and China in particular,” he added.
Freyr plans to raise an additional $ 850 million, as part of a merger agreement with Alussa Energy Investment Group, a ghost company that sold stock before any assets. The deal, announced in January, will help Freyr get listed on the New York Stock Exchange. The company plans to build batteries using technology developed by 24M Technologies based in Cambridge, Massachusetts.
The industry’s top priority is making batteries cheaper. Batteries for mid-sized electric cars cost around $ 15,000 or nearly double the price they need to make electric cars widely accepted, Srinivasan said.
Some savings can be saved by making small modifications, like making batteries near a car factory to avoid shipping costs, and by minimizing waste, according to Roland Berger. Approximately 10% of raw materials are wasted during battery production due to ineffective production methods.
But, in a recent study, Roland Berger also warned that increased demand could push up the prices of raw materials such as lithium, cobalt and nickel and cancel some of the effects. The auto industry is competing because batteries and electrical equipment and other energy companies need them to disrupt wind and solar energy, fueling demand further.
“We found that there could be a supply crisis this year,” said Jason Burwen, interim executive director of the US Energy Storage Foundation.
Various types of companies have sprung up to replace the use of expensive minerals in batteries with cheaper and more popular materials. San Jose-based OneD Material makes a substance that looks like coffee grounds to be used by the anode, the electrode through which electrical current flows out of the battery when the car is running. The material is made of silicon, a cheap and abundant raw material, in order to reduce the need for graphite, the more scarce and more expensive material.
In the long term, the industry’s “holy grail” is solid batteries, which will replace the liquid lithium solution in the core of most batteries with layers of solid lithium compound. Solid state batteries are more durable and less damaged by overheating, allowing for faster charging. Their weight will also be lighter.
Toyota and other companies have invested heavily in this technology, and have had success in making a few solid state batteries. The tricky part is mass-producing them at a reasonable price. QuantumScape has confirmed that it has found a material that can solve one of the main problems with mass-producing solid-state batteries – they tend to short-circuit if any defect occurs.
However, the majority of people working in this industry do not expect solid-state batteries to be widely used until 2030. Mass-produced batteries are “the hardest thing in the world,” said Elon Musk, Tesla executives, said in a recent phone call with analysts. “Prototypes are easy. But scale production is difficult.”
One thing’s for sure, however: This is the right time to get a degree in electrochemistry. People who are knowledgeable about the properties of lithium, nickel, cobalt, and other materials to batteries are like software programmers for computers. Jakub Reiter, for example, has been fascinated by battery chemistry ever since he was a teenager in the 1990s in Prague, which long before that seemed to have been a prevailing career option.
In 2011, Reiter was doing graduate research in Germany when an employer recruited him to work at BMW, who wanted to understand the science behind the batteries. Last year, InoBat hunted him down to help set up a factory in Slovakia, where Volkswagen, Kia, Peugeot and Jaguar Land Rover made cars.
Reiter is now chief scientist at InoBat, whose technology allows customers to quickly develop batteries for a variety of uses, such as cheap passenger batteries or branded versions. capacity for convertibles.
“Twenty years ago, nobody cared much about batteries,” says Reiter. Today, the industry has fierce competition, and “it’s a big battle”.
Mai Huyen (follow New York Times)