Faced with rising costs, automakers, battery makers, and raw material suppliers are banding together to address the pressing issue of electric vehicle (EV) affordability. Their partnership is important for automakers looking to bring EVs to the middle class in the coming years. According to consulting firm Guidehouse Insights, the average transaction price for an electric vehicle in September 2022 was $66,000, about $18,000 higher than the average price for a gasoline vehicle. That gap could be enough to slow the adoption of electric vehicles, especially at the entry level of the auto market, Guidehouse said.
Sam Abuelsamid, Principal Analyst at Guidehouse Insights, said:
The main reason for the price difference is the battery. The cost of lithium, nickel and cobalt, the key raw materials in batteries, has skyrocketed over the past three years. Lithium carbonate jumped 670% from the end of 2019 to March of this year, according to the report. wall street journalSimilarly, cobalt has tripled over that period and nickel has increased by 85% (partly due to Russia’s invasion of Ukraine). As a result, after years of falling prices, the cost of battery cells has risen again since 2020.
Two of the most common types of lithium-ion chemistries, Tesla’s Nickel-Cobalt-Aluminum-Oxide (NCA) and Nickel-Manganese-Cobalt (NMC), are particularly problematic and both require all three of these raw materials. Currently, the average pack cost of lithium-ion batteries is between $130/kWh and $140/kWh, which is considered too high for entry-level vehicles. At that price, even a small 60 kWh battery could cost $8,400.
Still, the auto industry remains optimistic about the future of battery costs. Automakers and suppliers have identified several ways to reduce costs. They fall into two categories he short term and long term.
short term fix
A short-term solution to eliminating nickel and cobalt is already here. Automakers have made commitments to a chemical known as lithium iron phosphate (LFP) that is nickel- and cobalt-free. Tesla has said he will use the LFP on all standard-range vehicles, and Ford plans to use his LFP on his Mach E and electric F-150 Lightning Mustangs, which will go on sale in North America in 2024. announced to use also says he plans to use the LFP for standard range vehicles. General Motors and Volkswagen have also said they are considering the idea of adopting LFPs.
Invented by Nobel Prize-winning scientist John Goodenough in 1997, lithium iron phosphate was initially considered a candidate for grid storage. It was not taken seriously as an electric vehicle chemistry because its energy level was too low. But the idea of using it in electric vehicles has gained popularity in recent years, first in China and now in the United States. In addition, it is more durable, stable and safer than NMC and NCA. However, the big advantage is cost. LFP is 30%-40% cheaper per kWh than its competitors. As a result, automakers can approach their long-standing goal of $100/kWh.
However, the factor that prevents its full-scale use is its energy level. LFP provides approximately 30% less energy. So an electric car with an NMC battery and a range of 240 miles drops to about 170 miles with LFP. As such, automakers are targeting standard-range electric vehicles rather than long-range electric vehicles. “If you don’t necessarily need hundreds of miles of range, an LFP battery is a great solution,” Abuelsamid said. “They are cheaper, last longer and are very secure. We are seeing a shift to LFP in many commercial applications.”
new lithium source
Combining low cost and high energy, however, is a more difficult problem and takes more time.
The first step in changing the long-term cost structure is to improve the supply scenario. Today most lithium is mined in the salt deserts of Australia and South America. In addition, limited supply coupled with increased demand in the automotive industry has kept prices high. But battery manufacturers are finding new sources. “Lithium is actually very common on Earth,” he said Abuelsamid. “It’s available almost anywhere in the world.”
One of those areas is the shallow waters inland of Southern California called the Salton Sea. Geothermal activity could loosen lithium beneath the Salton Sea and pump it to the surface, creating a potential source of bulk raw materials for the battery industry. Australia-based Controlled Thermal Resources has developed a geothermal process for extracting and separating lithium. It can be used for battery production. General Motors has partnered with Controlled Thermal Resources on this project. If this process is successful, the Salton Sea is believed to be able to supply enough lithium for all of North America.
A similar project involving Stellantis NV and Vulcan Energy Resources also uses a geothermal process to extract lithium in Germany. The German site is said to be Europe’s largest lithium resource.
As the availability of lithium increases, automakers believe the cost of the raw material will drop. Today, however, no one knows how much the cost will drop, or how long it will take for such a project to start producing large amounts of usable lithium for the automotive industry.
cheaper to manufacture
Another goal of cost reduction is on the manufacturing side. Suppliers are therefore working on ways to make manufacturing faster and easier, thereby reducing costs.
One such solution lies in the use of new binder materials that promise to reduce manufacturing costs. A binder known as Neocarbon-at-the-core is considered a potential alternative to the commonly used PVDF (polyvinylidene fluoride) electrode binder. PVDF has long been the best binder for lithium-ion electrodes, but it requires the use of a solvent called NMP (N-methyl-2-pyrrolidone), which requires very long roll-to-roll coating machines and long high loads. Is required. temperature drying process. Nanoramic Laboratories, which manufactures Neocarbonix, says its binder eliminates the need for his NMP, resulting in a more efficient drying process with faster throughput and less energy consumption. His Nicolo Brambilla, chief technology officer at Nanoramic Labs, said: “So you can use the same coater and go faster, or you can use a much smaller coater.” Nanoramic has partnered with Avesta Battery & Energy Engineering on the development of the battery with the new binder. increase. Nanoramic expects prototypes to be available in 2023 and in 2024 he plans to start working with OEMs.
Similarly, Tesla is working to reduce manufacturing costs by using a dry electrode coating process. If successful, the dry coating process will eliminate traditional slurry-based methods, reduce factory floor space, and reduce energy costs. Tesla acquired California-based startup Maxwell Technologies in 2019 with the aim of developing dry coating technology. The company currently has a pilot production line in Fremont, California that manufactures battery anodes. So far, however, Tesla has not expanded the process beyond the pilot line.
Industry analysts say other battery makers are also considering the dry coating process. “Dry coating will be the next big shift in cell manufacturing,” said Abuelsamid.
Whether all the cost-cutting tactics will bear fruit is another matter. Mining and mining are not always successful, and large-scale battery manufacturing is notoriously difficult, even for experienced suppliers. For this reason, battery manufacturers have always struggled to keep innovation on the timetable.
Still, the Center for Automotive Research (CAR) believes the price of lithium-ion batteries will drop in the next few years. The question is whether EVs will drop enough to make them a viable option for the middle class. The current average price of $66,000 for an EV is perilously close to the US Census median household income of $70,784 per year, which means prices need to come down significantly.
CAR’s director of technology, Brett Smith, said: “But getting it down to low-end, low-cost vehicles still seems like a challenge.”
Charles J. Murray A Long, Hard Road: Lithium Ion Batteries and Electric Vehiclespublished by Purdue University Press.