Automotive batteries in the EV journey

Issue #120, Dec 5th, 2021

The battery is a key component in the electrification journey. It accounts for more than 30% of the cost of an electric vehicle (EV). It is no wonder that there are several updates happening in this space. General Motors for example has tied up with Posco for cathode materials as part of its vertical integration. The responsibility for handling batteries at the end of their life could rest with the EV makers, if regulations are passed. Tesla has requested the U.S. government to extend tariff waivers on graphite imported from China for competitive battery prices. Traditional lead battery makers in India are not viewed favourably by investors, doubting their capability to pick up lithium-ion batteries. Conversion of engine driven vehicles to EVs is a cottage industry waiting to pick up. These are some recent updates in battery space in the automotive industry.

WEF's vision for sustainable battery value chain

A circular, responsible and just battery value chain is one of the major near-term drivers to realize the Paris Agreement goal in the transport and power sectors, setting course towards achieving the 1.5C goal if complemented with other technologies and collaborative efforts. This WEF report presents a simple yet profound vision: a circular, responsible and just battery value chain as one of the major near-term drivers to realize the goal. - WEF

Handling dead batteries

While most EV components are much the same as those of conventional cars, the big difference is the battery. While traditional lead-acid batteries are widely recycled, the same can't be said for the lithium-ion versions used in EVs. Currently, much of the substance of a battery is reduced during the recycling process to what is called black mass - a mixture of lithium, manganese, cobalt and nickel - which needs further, energy-intensive processing to recover the materials in a usable form. Manually dismantling fuel cells allows for more of these materials to be efficiently recovered, but brings problems of its own. The responsibility of handling these batteries may finally rest with the vehicle makers. - BBC

GM's vertical integration for batteries

General Motors is shifting aggressively toward vertical integration of key components including the batteries, motors and other components in its EV drive. The latest announcement from the automaker is a new joint venture with South Korea’s Posco Chemical that will process the cathode active materials. GM has developed a nickel-manganese-cobalt-aluminum (NMCA) mix for its new Ultium cells which reduces the cobalt content by about 80%. Ultimately GM wants to get to a cobalt-free blend. - Forbes

Tesla's push for graphite tariff waiver

Tesla is among the hundreds of auto industry players asking the U.S. Trade Representative for extended tariff waivers on parts and materials imported from China used to make or repair cars. Tesla and SK Innovation both requested a waiver on tariffs for graphite, which is used in the anode component of lithium-ion batteries in electric cars. Supply chain issues are contributing to soaring prices for new and used vehicles in the U.S.- CNBC

Lead batteries vs Lithium batteries

A few years ago, both Amara Raja and Exide were the favourite stocks of fund managers. However, over the past five years, the Nifty Auto has returned almost 23%, while Amara Raja and Exide have fallen 32% and 3%, respectively. Reason: lithium-ion batteries are replacing traditional lead batteries in EVs. And investors are concerned if these companies can adapt. - ET Auto

Converting ICE vehicles to EVs

EV conversion is a cottage industry that's emerged over the past five years, and been turbo-charged by advances in battery technology and electric motors in the past two. The market is largely untested, and several industry players interviewed by Reuters described an exciting, if precarious, scene. - Channel News Asia