Car Giants Focus On Lithium Battery Production

Car Giants Focus On Lithium Battery Production

Years ago, the great automotive “chicken or egg” debate centered on which technology would lead the way: the electric vehicle or the charging infrastructure.

Now it’s all about the lithium battery, as automakers like Tesla, General Motors, Daimler, Toyota, Nissan, and BMW cut deals for large scale battery production. They’re also seeing huge potential in the energy storage capacity available through the lithium battery packs they’re already building on their own or through supplier alliances.

There's been a wave of developments on the lithium battery front — both in terms of higher capacity for longer range electric vehicle driving and for energy storage as a serious revenue source for automakers. Lithium miners in Australia and Canada are seeing their stock prices climb, as demand for electric vehicles grows due to increasingly stringent government mandates and burgeoning interest in long-range, affordable EVs like the Chevrolet Bolt and Tesla Model 3.

Forecasts of expected demand for long-range EVs have lifted lithium carbonate prices more than two times the level reached in 2015.

Tesla CEO Elon Musk may be losing his popularity with shareholders and analysts as costs rise to meet aggressive Model 3 production targets, but interest is still quite strong from battery technology suppliers. One of them, Australian mining company Kidman Resources Ltd., will supply Tesla with lithium hydroxide through a joint venture with Chile’s giant Sociedad Quimica y Minera de Chile SA. Kidman will supply Tesla through its planned refinery in Western Australia for an initial three-year period, which could extend to more three-year agreements.

The Tesla deal has stirred up a good deal of interest. Kidman said on Thursday it was in talks with other “globally significant” parties seeking supplies of refined lithium.

Tesla’s major battery supplier, Panasonic, last week announced it will be extending its agreement with the electric carmaker. Along with producing battery cells for Tesla in Japan and jointly with the company at the Gigafactory in Nevada, Panasonic said it could jointly produce battery packs with Tesla in China.

Earlier this month, Tesla registered to establish a wholly owned company in Shanghai, according to a Chinese government’s website. The company plunked down 100 million yuan ($15.8 million) to register the new Chinese company. Tesla’s registration includes technological development and services on EVs, auto parts, batteries, energy storage facilities, and solar panel products. It may be ideal for setting up its second Gigafactory with Panasonic.

Along with German automakers preparing to become Tesla-competitive in luxury EVs and more affordable electric models, several upscale startups are being followed by auto analysts. One of them, led by car design chief Henrik Fisker, is based more on the strengths of the battery than on the beauty and power of the scheduled-for-launch Fisker EMotion. Fisker, who headed the now-bankrupt Fisker Automotive and its Fisker Karma plug-in hybrid luxury sportscar, is ready to go to the next phase with what he calls a three-dimensional solid-state battery.

The new company, Fisker Inc., says that its EV batteries will have three-dimensional electrodes with 2.5 times the energy density of current lithium-ion batteries. That will deliver a first — a 500-mile driving range with charging times that can go as low as one minute.