Few would disagree that electric vehicles represent the future of driving. BloombergNEF, a researcher, reckons that global sales of zero-emission cars will jump from 4% of the market in 2020 to a whopping 70% by 2040. But to get to that number vehicles will need to reach price parity with their fossil-fuel counterparts. One way to get closer to parity is to remove cobalt from their manufacture.
Typically found in rechargeable lithium-ion batteries, cobalt protects the negatively charged electrode (i.e. cathode) from corrosion and fire risks, while working as a booster for energy density and extending the car’s driving range.
With nearly half of the world’s known supply of cobalt mined in the Democratic Republic of the Congo in central Africa (see WiC329), the scarce resource is also susceptible to supply disruption and price volatility. For global car firms there are also compliance risks linked with the child labour sometimes used locally to extract it. All this makes it the most expensive material in an EV battery. Eliminating its use could help cut the prices of electric cars by up to a third, according to Japan’s Panasonic.
Chinese battery maker SVOLT Energy Technology claims it has an alternative. Based in the city of Changzhou in Jiangsu province, the company revealed last month that it had been mass-producing its proprietary cobalt-free lithium-ion battery cells since April. With a three-to-one ratio between nickel and manganese, the cathode in SVOLT’s novel NMX battery cells, in the absence of cobalt, relies on “specially developed doping and coating processes” to ensure thermal stability (i.e. to stop the battery ever catching fire).
SVOLT also claims that its NMX can be recharged a relatively high 3,000 times.
As the world’s first lithium-ion battery made without cobalt, SVOLT’s NMX could potentially push the price of energy-dense EV batteries to well below $100 per kilowatt hour, the threshold that would make EVs cheaper than internal combustion engine vehicles. (Panasonic unveiled its own lithium-ion cells that contain less than 5% cobalt only in January and is expected to take two to three years to reduce that ratio to zero.) Given its safety profile, the NMX format might also sideline lithium iron phosphate (LFP) batteries, whose relatively low energy density and bulkiness have made them less attractive for a lot of EV brands despite being cobalt-free (see WiC499).
Coming in two sizes (115Ah and 226Ah), NMX can serve both luxury-class and mid-range vehicles. Cherry Cat, a sports utility vehicle developed by SVOLT’s parent Great Wall Motors under the affordable ORA brand, will be the first to adopt the new battery. Starting from 2025, NMX will also be adopted by Amsterdam-based Stellantis, which operates 14 brands including Peugeot, Chrysler, Citroën, Fiat, Alfa Romeo and Maserati. Formed by a merger between Italian-American Fiat Chrysler Automobiles and France’s PSA Group earlier this year, Stellantis is currently the world’s fourth largest automaker by production volume and the third biggest by revenue.
The NMX deal was part of a Rmb16 billion ($2.48 billion) agreement that saw Stellantis source a wide range of offerings from SVOLT, including battery cells, high-voltage storage technologies and battery management systems. This was unveiled a few days after Stellantis announced its plan to roll out EVs from all its brands to meet its targets of low-emissions vehicles accounting for 70% of its European sales and 40% of those in the US by 2030.
Initially, SVOLT will fulfil the order from production capacity in China and over time via more facilities in Europe.
After raising Rmb3.5 billion ($540 million) in February through its series-A financing led by Bank of China, SDIC, IDG and Great Wall Motors (from which it was spun off in 2018), SVOLT said that it is seeking to add new capacity by expanding its current manufacturing hub in Changzhou’s Jintan and building new factories in the Chinese provinces of Hunan, Hubei, Sichuan and Zhejiang, as well as in Germany’s Saarland. By 2025 the company expects to have 136.6 gigawatt hours (GWh) of battery production capacity, versus market leader CATL’s 497.5 GWh (see WiC537).
SVOLT is among the leading Chinese EV battery makers that are establishing a big presence in Europe, with the continent last year displacing China as the world’s largest EV market. Hefei-based Gotion High-Tech, for instance, is planning to work with its largest shareholder Volkswagen to build one of the auto giant’s six new battery factories in Germany’s Salzgitter.
Envision AESC, which is 80%-owned by Shanghai-based Envision (which got its start in wind power) and is 20%-owned by Japan’s Nissan Motor, has also pledged to build a $2.4 billion battery plant in northern France with an annual capacity of 24 GWh. This was agreed under a partnership with French carmaker Renault in June. Envision AESC is also planning to invest £423 million ($576 million) in a new gigafactory in the UK’s Sunderland, which will be its second battery factory in the city. Producing batteries for Nissan’s new electric vehicles, the facility will have an initial annual capacity of 9 GWh, which potentially rises to 25 GWh by 2030 should Envision AESC invest an additional £1.8 billion.
© ChinTell Ltd. All rights reserved.
Sponsored by HSBC.
The Week in China website and the weekly magazine publications are owned and maintained by ChinTell Limited, Hong Kong. Neither HSBC nor any member of the HSBC group of companies ("HSBC") endorses the contents and/or is involved in selecting, creating or editing the contents of the Week in China website or the Week in China magazine. The views expressed in these publications are solely the views of ChinTell Limited and do not necessarily reflect the views or investment ideas of HSBC. No responsibility will therefore be assumed by HSBC for the contents of these publications or for the errors or omissions therein.