Focus: For EV battery makers, it's go small or go home

Wuling Motors Holdings

11/07/2022 07:00

By Nick Carey and Paul Lienert
    CAMBRIDGE, England, July 11 (Reuters) - In the race to go
electric, carmakers have focused on range to ease consumer
anxiety over charging infrastructure, but battery makers are
already working on the smaller, longer-lasting and cheaper
batteries of the future, which also charge more quickly.  
    While carmakers today chase market leader Tesla Inc
 TSLA.O , seeking to build cars that can travel 300 miles (482
km) or more between charges, battery startups expect range will
matter less as public electric vehicle (EV) chargers become
ubiquitous. In the quest for smaller batteries that charge
extremely quickly, the startup firms are experimenting with
materials like silicon-carbon, tungsten and niobium.
    The battery is an EV's most expensive part, so true fast
charging coupled with widely available chargers - a lack of
charging infrastructure today is seen as slowing broader
adoption of EVs - would allow automakers to build cars with
smaller batteries at more affordable prices, yet boost profit by
selling more vehicles to a broader audience.  
    "Early adopters at the higher end of the market wanted 
bigger battery packs and longer range because they could afford
it," said Sai Shivareddy, chief executive of Nyobolt, a startup
developing niobium oxide anode materials for batteries that can
charge in minutes. "For more cost-sensitive mainstream adoption,
you need smaller battery packs ... but with the same experience
as today (with fossil-fuel cars) where you can fill up in 5
minutes." 
    China dominates global EV battery production and companies
like Contemporary Amperex Technology Co (CATL)  300750.SZ    
are developing batteries to go farther on a single charge.
 urn:newsml:reuters.com:*:nL1N2YA0GM 
    Carmakers in China have rolled out small, low-cost EVs like
the Wuling Hongguang Mini - which even with recent battery price
rises still sells for around $6,500. The car is a joint venture
of SAIC Motor Corp Ltd  600104.SS , General Motors Co  GM.N  and
 Wuling Motors  0305.HK .
    Western startups like Cambridge-based Nyobolt and Echion
Technologies or Woodinville, Washington-based Group14
Technologies are working on electrode materials to bring super
fast-charging batteries to market. 
    According to startup data platform PitchBook, EV battery
technology investments jumped more than sixfold to $9.4 billion
in 2021 from $1.5 billion in 2020 as carmakers focused on the
future.  
    "We are in the larval stages of battery development," said
Lincoln Merrihew, vice president at data analytics firm Pulse
Labs. (Here is a graphic: https://tmsnrt.rs/3NOMxqS)
    Going small could also ease looming battery material
bottlenecks as EV demand soars, while using less cobalt and
nickel where China dominates refining and processing. 
    Another benefit is carmakers could claim sustainability wins
using less harmful materials in EVs and emit less CO2
manufacturing them.
    "Re-engineering the vehicle to minimize the size of the
batteries, since that's so expensive, is going to be a game
changer," Ford Motor Co's  F.N  chief executive, Jim Farley,
said at a conference in June. The U.S. carmaker, he added, wants
"the smallest possible battery for the competitive range" in its
next generation of EVs starting in 2026.
    Others are squeezing more efficiency out of existing
batteries, as Mercedes-Benz  MBGn.DE  has done with its EQXX
prototype with a range of 1,000 km (621 miles).  urn:newsml:reuters.com:*:nL5N2WB53W
    
    MORE AFFORDABLE EVs
    Fast charging today is limited by EV batteries' ability to
absorb power quickly. Fast charging can shorten batteries'
lifespan or overheat them, so most EVs limit charging speed to
protect them.  
    At Nyobolt's headquarters, CEO Shivareddy charges four
batteries in around three minutes and plugs them into a robotic
vacuum that busily cleans the floor behind him as he speaks. 
    Niobium is a stable metal often used to strengthen steel -
the world's largest deposits are in Brazil and Canada. Used in
anodes or cathodes, startups like Nyobolt and Echion say niobium
can handle super-fast charging while lasting many years longer
than today's batteries.
    Nyobolt is focusing on high-performance racing EVs and
Shivareddy said it will take years of validation before
carmakers are ready to use its batteries in mass-market models.
    A few miles from Nyobolt, Echion's niobium anodes are
initially for commercial EVs like mining vehicles that operate
continuously and will need fast charging. 
    CEO Jean de La Verpilliere said Echion's goal is to have
batteries ready for passenger EVs by 2025.
    "Smaller batteries mean cheaper prices and therefore more
people can afford EVs," he said.
    Brazilian mining company CBMM dominates niobium production
and has invested in Echion and other startups and is testing
niobium with others including battery materials company Nano One
 NANO.TO , Toshiba  6502.T  and Volkswagen Caminhoes e Onibus, a
Brazilian subsidiary of Volkswagen's  VOWG_p.DE  trucking unit
Traton  8TRA.DE .
    Rogerio Marques Ribas, head of CBMM's battery program, said
although niobium's energy density can be up to 20% lower than
some contemporary batteries, "we can bring maybe three to ten
times more life and more safety while charging in minutes."
    "Raw materials will be a bottleneck for batteries," Ribas
added. "In the near future people will ask, why have a big
battery pack?"
    
    'THE MARKET DECIDES RANGE'
    Niobium is not the only material that startups are
exploring.
    Group14 Technologies makes silicon-carbon anode material
that enables lithium-ion batteries to hold up to 50% more
energy. The company raised $400 million from investors in May.
 urn:newsml:reuters.com:*:nL2N2WV1P2
    Testing Group14's material, Mercedes-backed battery maker
StoreDot has charged batteries to 80% capacity in 10 minutes.  
Group14 CEO Rick Luebbe said its anode material could offer a
fast EV charge in five minutes.
    "When I can top my battery pack off in five or 10 minutes
... then it doesn't really matter too much what that range is,
whether it's 150 miles or 300 miles," Luebbe said.
    Michigan-based startup Our Next Energy (ONE) has developed
its Gemini "dual chemistry" battery featuring a standard Lithium
Iron Phosphate (LFP) traction battery with a second "range
extender" battery using more advanced and expensive chemistries,
providing low, medium and high range options.
    "The market ultimately decides the right level of range,"
said CEO Mujeeb Ijaz.
    According to industry data, the average American car drives
less than 30 miles per day. In Europe, the average is less than
half of that.  
    Isobel Sheldon, British battery company Britishvolt's
 IPO-BRI.L  chief strategy officer, said as EV owners realize
they are paying for more than they need, the market will demand
less range.
    "As the market matures, people will start to ask why I am
paying thousands ... for a battery I'll never use," she said.
"Most car use to is to drive to the shops, go and see friends or
drop kids at school, not to drive to Monaco." 
        

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 (Reporting by Nick Carey in Cambridge, England, and Paul
Lienert in Detroit
Editing by Ben Klayman and Matthew Lewis)
 ((nick.carey@thomsonreuters.com; +44 7385 414 954;))