Is Europe ready to fight the battery battle?
Finally the European entrepreneurs are reacting to the avalanche of battery manufacturers coming from China, South-Korea and the US. Is their reaction too little too late?
Between now and 2025, some 400 new electric models (EV) are announced and the sales of EVs is estimated to pass the 25 million unit hurdle in that same year (some quarter of total car sales). This asks for huge investments in producing batteries and that’s what manufacturers are doing right now.
Together they want to boost production of battery cells from 34,7 GWh today (source EV Sales Blog) to 300 GWh in 2025 (source EIT InnoEnergy). Today this market is largely dominated by the Japanese (Panasonic, AESC, Toshiba and Toyota), the South-Koreans (LG Chem, Samsung SDI, SK Innovation) and the Chinese (CATL, BYD and GS Yuasa).
In the wake of the gigafactory of Tesla in Nevada, scheduled to produce 35 GWh of battery capacity this year and 50 GWh from 2020 onward, several tens of similar factories are announced in China, the US and Europe. Tesla itself has also announced two other facilities, one in Europe (not defined where yet, but with Germany as a preferred choice), and one in Shanghai, China.
The investments for such mega-plants range depending on the size and technology from 300 million to 4,2 billion euro. The next big one to come is from BYD (Build Your Dreams). The Chinese battery giant will open a 24 GWh factory (soon to become 60 GWh) in Qinhai, a region where 83% of the Chinese lithium is produced.
CATL to become number one?
Chinese battery producer, CATL, wants to become number one by quintupling its production to 88 GWh in 2020. Its gigafactory in Huxi (China) of 25 GWh will be the second biggest for the moment after the Tesla factory in Nevada.
Its production will be primarily destined for Chinese EV manufacturers, like BAIC, Zhengzhou Yoting group, etc. but also Honda, Hyundai, Nissan, Toyota and VW in China. CATL also wants to build a battery factory in Germany delivering to Lamborghini, Mercedes-Benz, Porsche and Volkswagen.
Those giants are clearly ready to take Europe as well. Samsung SDI will invest 304 million euro in Hungary in a 2,5 GWh factory producing 50.000 batteries of 50 kWh per year.
LG Chem will invest 1,36 billion euro in Wroclaw (Poland) in a 4 GWh factory (for 280.000 batteries in the long run) opening in 2019. SK Innovation is spending 600 million in Komaron (Hungary) for a 7,5 GWh factory in 2020, delivering 200.000 batteries of a 500 km reach.
20 gigafactories in EU
Europe has to defend itself, says Marus Sefcovic, VP of the European Commission: “To (re)conquer a big part of the battery market we will have to invest 20 billion euro in 10 to 20 gigafactories in Europe.”
The most advanced project here is Daimler’s Accumotive (527 million euro) to produce batteries in Sachsen, Germany, and another gigafactory on the Mercedes production site of Untertürkheim (near Stuttgart, Germany).
‘Airbus of the batteries’
Apart from this there are three different consortiums. First in the row is recent start-up, Northvolt (together with ABB and Siemens), managed by former Tesla guys, Peter Carlsson and Paulo Cerruti. The aim is to build the biggest Li-ion factory in Europe (3,7 billion euro) on a 500.000 m2 surface, good for 8 GWh from the beginning of 2020 and 32 kWh in 2023.
TerraE projects a production of 34 GWh yearly production in a further future (2028). The project is depending on KliB, the German competence network around Li-Ion, gathering some 45 companies involved in the sector. Some experts say that Europe has already lost the Li-Ion battery battle, the technical solution currently used and dominated by the Chinese.
For the moment Lithium-ion ‘liquid’ batteries are top, in the future we will have to look into solid state batteries. The French company, Saft (Total owned), has embarked Belgian Solvay, German Manz and Siemens to create a 1 GWh factory for solid state batteries by 2025.
Not for Tesla
Start-up Fisker Inc. (California) wants to innovate with three-dimensional electrodes with a 2,5 fold energy density compared to Lithium-Ion, hoping to deliver batteries with a 800 km+ range.
However, founder Henrik Fisker (remember the Karma car) is very clear: “We want to be a car manufacturer with our E-Motion sports car, not a producer of battery cells. Our technology is open for everybody… except for Tesla.”
In France there is Tiamat, a start-up which goes for Na-ion technology (sodium based) that doesn’t depend on lithium and (especially) cobalt for its batteries. A big advantage given the relative shortage and the price of cobalt (60.000 to 95.000 euro per ton). Not to speak about the human problems in cobalt mines.
“Our recharging time is only 5 to 10 minutes”, says Laurent Hubard, CEO of Tiamat. “That means that we can produce smaller batteries for a range of 200 km.” His company has just assembled 3 million euro and 10 patents.
Steps and scooters
Tiamat produces battery cells in the 18/650 format (18 mm of diameter, 650 mm high), an industrial accepted format compatible with all planned gigafactories. The first batteries will not be tested in cars but in steps and scooters in real driving conditions.
It seems that Europe has already lost the Li-ion battery war. Maybe it has to concentrate on alternatives that are emerging and hope that they will become the new (and better) solution. In either way, it will be very difficult and costly to recover the lost ground.