Dear battery enthusiast,
Welcome to Battery Associates’ February Newsletter. We summarised some of the month’s most relevant battery news, highlighting technology and research development, and updates from Battery Associates.
Battery Newsletter structure:
Battery Industry Highlights
B.A Editorial
Battery Insiders Podcast
B.A Company Member Updates
B.A Updates & Events
Battery Industry Highlights
In this section, we have summarise relevant battery news from the past month.
On February 13, automaker Ford announced its US $3.5 billion Lithium Iron Phosphate (LFP) battery manufacturing plant in Michigan named BlueOval Battery Park Michigan. This will be Ford's wholly-owned facility in the United States. The Michigan-based battery manufacturing facility will be Ford's first LFP manufacturing facility, with a nameplate production capacity of 35 GWh, and it has plans to start its mass production rollout by 2026.
B.A Commentary: Ford has committed to spending US $50 billion on electric vehicles globally by 2026. As part of this commitment, Ford has partnered with various battery collaborators in different parts of the world. In the U.S., Ford and SK Innovation have already announced a joint venture BlueOval SK battery plant with a total investment of US $11.5 billion. In addition to this facility, Ford has partnered with CATL to manufacture LFP batteries in the U.S. In Europe, Ford has partnered with LG Energy Solutions to build its joint venture battery manufacturing plant in Turkey to supply batteries for its European EVs (see below).
On February 22, LG Energy Solutions, Ford, and Koç Holding signed a non-binding MoU to set up a joint venture battery manufacturing facility in Ankara, Turkey. The manufacturing facility is planned to have an initial nameplate production capacity of 25 GWh and is capable of expanding up to 45 GWh. It is expected that the facility will begin its mass production rollout by 2026.
B.A Commentary: On March 14, 2022, Ford announced a partnership with SK Innovation and Koç Holding to establish a joint venture battery manufacturing facility in Turkey. However, SK Innovation has since withdrawn from the agreement in January 2023, citing global economic shrinkage. SK Innovations has already made significant investments in both the US and Europe to expand its battery production capacity, depleting the capital availability for further projects. As a result, the company has decided to provide funding for its highest priority projects.
In February, according to the website of the Zhengzhou government in China, BYD's battery manufacturing unit, FinDreams Technology, announced plans to build a 40 GWh blade battery manufacturing facility with an investment of US $1.2 billion.
B.A Commentary: BYD, a Chinese OEM, is expanding its battery production capacity through its battery manufacturing unit FinDreams Technology in China. The demand for EVs is increasing both domestically in China and in foreign markets, prompting BYD to increase its battery production to meet the growing demand.
On February 3, the German automaker announced an 800 million euro investment to establish a high-voltage battery assembly plant in San Luis PotosÃ, Mexico. Of the total allocated investments, 500 million euros will be utilised for the construction of a new assembly center for high-voltage batteries, and the remaining 300 million euros will be used to transform its old facility into an electric vehicle assembly facility.
B.A Commentary: As part of BMW's electric transformation plan, the German automaker is heavily investing in transforming its existing IC engine assembly unit into its new iFACTORY, which assembles its EVs. Last year, in October, BMW invested US $1 billion to prepare for the production of electric vehicles at the company's existing U.S. manufacturing facility in South Carolina. In 2019, BMW invested more than 1 billion Euros to advance its Austrian site, upgrading and preparing them for electric mobility.
On February 17, Volvo Construction Equipment announced a US $7.8 million dollar investment to establish a battery pack manufacturing facility in Changwon, South Korea. Volvo Group plans to make the Changwon plant a centre for electric excavators. Construction of the facility will begin in April 2023, and mass production rollout of battery packs is anticipated by June 2024.
B.A Commentary: In 2022, the electric construction equipment market is estimated to be around US $54 billion, and it is expected to grow to US $117.8 billion by 2032. In line with this trend, Volvo CE has announced its investment to accelerate its EV transition in the construction equipment business.
On February 2, Freudenberg e-Power Systems and LG Energy Solution signed a multi-year contract for the supply of 19 GWh capacity of lithium-ion battery cell modules for commercial vehicles such as trucks and buses. These battery cell modules will be assembled at Freudenberg e-Power Systems' XALT gigafactory in Midland, Michigan, USA.
B.A Commentary: LG Energy Solutions supplies batteries for different sectors, such as the automotive and energy storage industries. Now, the company has partnered with Freudenberg e-Power Systems to develop and manufacture battery cells for commercial vehicles. The battery pack will be assembled at Freudenberg's XALT gigafactory in Midland, Michigan, USA, in collaboration with LG Energy Solutions.
On January 30, Posco Chemical and Samsung SDI signed a 3 billion US dollar contract for the supply of cathode materials. According to the contract, Posco Chemicals will supply NCA cathode materials to Samsung SDI for the next 10 years.
B.A. Commentary: South Korean battery manufacturer Samsung SDI is rapidly expanding its battery production capabilities by establishing battery manufacturing facilities in various countries. On July 7, 2022, Samsung SDI announced an investment of US $1.3 billion in its second battery manufacturing plant, and on May 25, 2022, Samsung and Stellantis announced their joint US $2.5 billion battery manufacturing plant in the U.S. While a large volume of Samsung SDI's batteries is NMC-based, the battery manufacturer is now planning to increase its NCA battery production capacity to diversify its battery portfolio.
On February 17, LG Chem has become the first Korean company to secure lithium from Piedmont Lithium Inc. LG Chem signed an off-take agreement to secure 50,000 tonnes of lithium ore, which will enable it to extract 30,000 tons of battery-grade lithium, enough to power 500,000 high-performing electric vehicles. To stabilize its North American supply chain, LG Chem has made an equity investment of US $75 million in Piedmont Lithium Inc. LG Chem has also placed an order for 10,000 tons of lithium hydroxide to be produced by Piedmont Lithium Inc.
B.A Commentary: LG Energy Solutions is one of the larger Li-ion battery manufacturers in the U.S. In 2021, the company expanded its battery production capacity at several manufacturing plants in the country. To take advantage of the Inflation Reduction Act proposed by the Biden administration, LG Energy Solutions is increasing the vertical integration of its supply chain in the United States. This move could make the company eligible for tax credits of up to 10% of production costs for certain critical minerals used in EV manufacturing.
Battery maker Hina Battery and Sehol, a joint venture brand between JAC and Volkswagen Anhui, have displayed their first sodium battery-powered EV model (E10X Model) in China. The test EV has a battery pack with a capacity of 25 kWh and an energy density of 120 Wh/kg at the pack level. It has a range of 252 km and is adaptable to fast charging of 3C to 4C.
B.A. Commentary: Chinese Na-ion battery manufacturer Hi-Na Battery began its gigawatt-hour (GWh) production of Na-ion batteries in November 2022. Hi-Na Battery is the first company to power an EV entirely with Na-ion batteries. Several battery manufacturers have announced their Na-ion production targets and strategies to incorporate Na-ion batteries into their battery architecture to reduce the overall cost of the battery pack.
B.A Editorial B.A Editorial is a monthly news article curated by the B.A Community CATL's Advanced Vertical Integration Strategy Puts U.S. Battery Industry on Notice Amid Inflation Reduction Act Rollout Regarding the Inflation Reduction Act by the Biden Administration in the US, CATL's ability to provide special discounts on its battery cost can be seen as a response to the subsidies and incentives provided by the US government to the battery industry. By offering competitive prices, CATL is likely trying to maintain its market share and competitiveness in the global battery market.
As part of the Inflation Reduction Act, US battery makers will receive a $35/kWh tax credit for battery cells and a $10/kWh tax credit for battery modules. This will bring the cost of US-made batteries to a level equivalent to China-made batteries, which currently range from $110/kWh to $125/kWh. Previously, US-made batteries were 33% more expensive than Chinese batteries. This reduction in cost will make the battery market more competitive. For more information, please read our December 2022 newsletter.
In February 2023, Reuters reported that the Chinese battery maker, CATL, is offering special discounts of more than 20%. This will bring the cost of CATL's batteries down to around US $95/kWh to $105/kWh for select customers who source the majority (estimated to be around 80%) of their battery requirements exclusively from CATL.
How CATL can do this? Why other battery makers cant do this?
CATL has developed one of the most sophisticated vertical integrations in its battery raw materials supply chain. It has control over the cost reduction from raw materials mining to battery recycling. CATL has heavily invested in various mining companies in different countries such as Australia, Argentina and African countries etc. to de-risk its supply chain vulnerabilities. Besides controlling its primary raw material supply chain, CATL also has a strong control over its secondary raw materials supply chain.
CATL has established the world's largest battery recycling network in China, and recently, its recycling company Brunp announced a massive US$3.5 billion investment to build a new battery recycling facility in Guangdong. With an annual recycling capacity of 500,000 tons, this move showcases unprecedented levels of vertical integration in the battery manufacturing industry. It has gained significant attention and underscores the importance of maintaining cost control to remain competitive in the market. Battery manufacturers should consider adopting similar strategies to achieve vertical integration at all levels.
Battery Insiders Podcast Summary
Battery Associates runs a monthly podcast called Battery Insiders. Battery Insiders covers the role of batteries for sustainable development and battery-relevant topics featuring a range of battery experts and enthusiasts. Our podcast also includes the recordings of the Battery Revolution Clubhouse sessions co-hosted live by Mariam Awara. Battery Insiders is hosted by Bhavya Jha and Dr Simon Engelke.
Talk on: "Battery Talent and Salary Report 2022"
Speaker: Julia Reichel, Founder at Arvensis Search co-hosted by Dr. Simon Engelke and Mariam Awara Session summary: On February 12, 2023 Battery Revolution Clubhouse hosted Julia Reichel, Founder at Arvensis Search, who spoke on the topic of Battery Talent and Salary Report 2022. Listen to the full episode here. Read the key conclusions here and request the full report here.
Company Membership Update
Circular partners with SQM
Circulor is collaborating with SQM, one of the world’s largest producers of lithium, to provide end-to-end traceability of this key critical mineral for the energy and mobility transitions. Read about the partnership here.
Battery Associates Updates
FT Live Future of the Car
Battery Day 2023
BatteryMBA January Cohort
FT Live Future of the Car- 9-11 May 2023
Achieving Efficiency, Sustainability & Connectivity in Automotive
In-Person & Digital | London, Convene
The FT Future of the Car summit is a must-attend, three day strategy-focussed conference for anyone leading at the juncture of traditional automotive industry practice and technology-driven disruption. It is the only automotive summit to attract the most visionary CEOs and thinkers for an objective analysis of the industry’s toughest challenges. Speakers include CEOs from Ferrari, Bentley, McLaren, Polestar, Aston Martin Lagonda, Peugeot, Renault Group and many more.
Battery Day 2023
Join us on Thursday September 21, 2023 for our online annual event - Battery Day 2023. Register here. Battery Day 2023 will feature panels and deep dive sessions to facilitate up-to-date knowledge about battery technology and advancements. Last year's Battery Day welcomed 900+ delegates from 60+ countries with 30+ leading speakers in the battery sector. You can purchase the recordings of Battery Day 2022 to access 10+ hours of content here. If you are interested in being involved in the event, please contact info@battery.associates. Sponsoring and speaking opportunities are available.
BatteryMBA Announcement
BatteryMBA’s eighth cohort starts on May 8, apply here and receive early access to 60+ past lecture recordings. The course consists of an exciting Battery Case Study Track (with case-studies from leading business schools). BatteryMBA alumni and participants work at Tesla, Airbus, JLR, Farasis Energy, Li-Cycle, Hitachi Energy, InoBat, AVL, Circulor, European Parliament, and many others. For any queries, please reach out at info@battery.mba.
Battery Associates services
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About Battery Associates
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