Who Will Win the Battle for the European EV Battery Market?

Contributed Commentary By Francis Wang, CEO of NanoGraf

July 16, 2020 | Energy storage defines the limits of our mobility today. From the small batteries that power our numerous portable electronics to the large battery packs that propel electric vehicles, we rely on powerful, rapidly evolving batteries to power the devices that enable our mobile and connected world.

While many urban commuters are familiar with hybrid buses and may even already have an electric vehicle themselves, in the future, all vehicles will be autonomous, on-demand, and electric.

We’re beginning to see this trend emerge in the automotive sector, and one of the harbingers of what’s to come is electric car battery sales, which are projected to hit $60 billion by 2030 globally.

To get a better look at what our future may look like, the European market for electric vehicles is often used as a model for what the global transportation future might look like. The big question is: who will win the battle for the European EV battery market?

Why Europe? A Strong History of Leadership through Premium Automotive Brands 

Europe’s superlative track record for making great vehicles, as well as its progressive stance on clean energy, make it an excellent model for predicting the future of green technology. The continent is also an interesting case study because, as McKinsey reports, Germany is positioned to become the world market leader for electric cars by 2021, as its OEMs are projected to produce over more than 1.7 million EVs.

In order to get these vehicles on the road, battery production will need to increase rapidly. To do this and meet targets, a differentiated battery will need to emerge. It must have: the best range and the charging infrastructure to support it, a quick time to recharge while meeting safety requirements, and a price tag that’s balanced against the first two factors.

The raw battery materials will be the key component that can be adjusted to impact all three of these factors.

European Automakers Have Electrified Their Plans

In the past two years, European manufacturers have thrown down a gauntlet and set a new standard for EV adoption. In December 2019, the BMW Group announced that they’d put half a million electrified vehicles on the road and that they will put “one million electrified vehicles on the roads within two years.”

Rival brand Volvo has also committed to add electrification to all of their vehicles. In the words of Håkan Samuelsson, President and CEO, “We are determined to be the first premium car maker to move our entire portfolio of vehicles into electrification.” Their goals are ambitious:

  • By 2025, Volvo aims to have 50 percent of their car sales volume be fully electric.
  • They’ve committed to putting one million electrified cars on the road by 2025.

And they’ve already begun. This manufacturer has promised that every new car they launch from 2019 onwards will have an electric motor: the future is here.

Why the Battery Is Strategically Important to EVs

A quote from Toyota’s Shigeki Terashi said it best: “the one who conquers batteries will conquer the electrification of cars.”

Electric cars are only as good as their energy storage: batteries define the performance of the electric vehicle (range, weight, charge time etc) and ultimately their cost. Batteries are widely accepted as one of the central limiting factors with EV’s:  range, charge time, cost, features, and design are all impacted by the energy density (Wh/kg and Wh/L), safety, $/kWhr and battery form factors.

For many EV shoppers, the primary concern today is range–“range anxiety”.  Although the average commuter travels less than 40 km/day, there is a fear among many consumers that EV’s will not meet their daily needs, let alone the occasional “road trip”. Ultimately (either real or imagined) there is a perception that today’s lithium-ion batteries do not meet mainstream consumers’ expectations.

Therefore, one could very reasonably argue that the European EV and battery market will be won by those who are first to unlock a differentiated battery technology(s). There are many competing battery technology pathways, but many would argue that there are three categories that will likely have the greatest impact in the near-term:  high energy density next generation silicon anode technology, longer cycle life cathode technology and safe fast-charging technologies.

The Challenge: Range and Cost

All the questions around how to build a better battery come back to consumer pain points:  range and cost.  To improve range, battery researchers have been focused primarily on higher energy density anodes and cathodes which determine the amount of energy stored on each charge and in turn the range of a vehicle.  Most battery experts agree that advanced silicon anodes will be leading the way in the near-term, as the past decade has been focused on optimizing the positive electrode.  Alternatively, many researchers are focused on implementing fast-charging technologies which would also minimize range anxiety concerns with the right charging infrastructure.

On the challenge of cost, battery researchers are finding ways to prolong the usage of batteries to enable much longer-lasting vehicles.  Although EVs do currently command a premium upfront price, the strategy is to utilize EVs much longer than traditional internal combustion engine  (ICE) vehicles. Improvements in calendar and cycle life will also meet improvements in cheaper more energy density rich components on both the anode and cathode side.

European automotive giants are counting on battery researchers and manufacturers to break through the current plateau in battery performance to enable the widespread adoption of electric and autonomous vehicles.  For forward-thinking consumers, this revolution cannot come soon enough.

Francis Wang, PhD is CEO of NanoGraf, an advanced battery material startup whose patented silicon-graphene anode technology enables longer-lasting, higher-energy, and higher-power lithium-ion batteries. He can be reached at francis@nanograf.com