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Making Battery
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Industry Eyes Key Targets for 2025
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The Market for Battery-electric Vehicles Has Been Growing Steadily but Slowly Over the Past Decade

From 2010 to 2020, BEVs primarily were viewed as compliance vehicles, offered in the market mainly to meet emissions regulations, often with limited availability. Most early BEVs could travel only about 100 miles (161 km) between charges, making them suitable largely for drivers with short daily commutes. And because they tended to be small cars, not the more popular light trucks and CUVs that have accounted for more than half of new-vehicle sales in the U.S. during the past decade, they had narrow appeal.

However, the BEV market is projected to grow sharply over the next few years, as automakers dramatically increase their model offerings and demand is driven in part from expected post-2030 prohibitions on the sale of internal-combustion-engine vehicles in many of the key global markets – including Europe, China, Japan and some U.S. states such as California.

Automakers already have been working to make BEVs more attractive to consumers, boosting driving ranges and expanding their fully electric model lineups to include more CUVs and pickups.

That effort appears to be paying off. BEV sales in the U.S. this year totaled 300,635 through September, the highest nine-month volume ever and marking a 91.3% jump from like-2020, when the COVID-19 pandemic slowed new-vehicle sales overall.

It’s been a similar story outside the U.S. where global BEV deliveries climbed 170% in first-half 2021 and are forecast to end the year at a record 4.1 million units, spurred primarily by increasing demand in China and Europe. With hundreds of new models coming to market in the next decade – up from just 61 nameplates available in 2017 – LMC Automotive projects worldwide BEV sales to climb beyond 29 million units annually by 2030.

But there are roadblocks ahead that must be cleared if those volumes are to be reached. BEV charge times and prices will need to shrink further, while driving ranges must rise beyond the 300 miles (483 km) beginning to be seen today. Battery packs will need to become lighter and be able to safely charge more quickly if consumers are to abandon their ICE vehicles for BEVs.

To get an inside look at where battery-pack design is headed, what materials and technology developers are looking toward to cut weight and improve performance and what power, range and costs will be targeted with next-generation BEVs, Wards Intelligence surveyed more than 260 industry executives and engineers at automakers, Tier 1 and 2 suppliers and consultancies.

Performance Targets

When the all-electric Nissan Leaf entered the market beginning in late 2010, it had a 73-mile (117-km) range. Since that time, BEV range has climbed steadily. The Chevy Bolt, Ford Mustang Mach-E, Volkswagen ID.4 and Hyundai Kona now offer at least 200 miles (320 km) of driving between charges. The Tesla Model 3 Long Range and new Rivian R1T pickup boast more than 300 miles, while the Lucid Air claims 520 miles (837 km) of driving range.

But what will be the minimally acceptable range to be competitive in the market in 2025, as automakers continue to try to find a balance between extending range and limiting the cost of expensive lithium-ion batteries? By a wide margin, respondents to the Wards Intelligence 2021 Battery Electric Vehicle Future survey contend by mid-decade BEVs will require 350-plus miles (563 km) of range, although suppliers are slightly less convinced than automakers and consultants of the need to exceed even 300 miles.

Figure 1: What do you believe will be the minimum range necessary for next-generation battery-electric vehicles to be competitive in the market in 2025?

Extending range becomes less of a factor if owners have the ability to charge their BEVs more quickly. In fact, charge time may be replacing range anxiety as the top concern for BEV purchase intenders, recent consumer surveys indicate. A BEV with a range of 200 miles can require 10 hours to recharge via a Level 2 (240V) connection, or entire days to refill using a standard Level 1 (120V) outlet.

On average, industry insiders believe by 2025, BEVs must recharge to 80% capacity within 10-20 minutes, although here too the views are somewhat divergent across the industry. A third of automakers responding to the survey don’t see a need to take charging times below 30 minutes, compared with about a quarter of suppliers who feel that way. Consultants, in particular, foresee a need to aim higher, with 59% suggesting a target of 10 minutes or less for charging a pack to 80%.

Figure 2: In order to be competitive in the market in 2025, a BEV will need to be able to recharge to 80% capacity in…

Most BEVs have battery packs with 400V electrical systems, but the trend to more expensive, higher-voltage batteries that enable faster charging appears clear.

The Lucid Air employs a 900V battery that can add up to 20 miles (32 km) per minute using a 300-kW DC fast charger. The Porsche Taycan and upcoming Audi e-tron GT both are built around 800V packs, with charging times to 80% under 25 minutes in the case of the Taycan. Hyundai is promising an array of 800V BEVs, including the current Hyundai Ioniq 5 that can go from 10% to 80% state of charge in 18 minutes on a 350-kW DC ultrafast charger. General Motors also has this 800V charging capability with its upcoming GMC Hummer truck capable of adding 100 miles (161 km) of range in about 10 minutes using a 350-kW DC ultrafast charger.

About one-fifth to one-third of BEVs available in 2025 are expected to have these higher-voltage battery packs, say the majority of respondents to our survey. Another 21% believe high-voltage packs will be in 11%-20% of BEVs, meaning nearly 70% of respondents expect high-voltage models will account for at least 11% of BEV production. Consultants again are the most bullish, with 79% projecting high-voltage pack penetration at up to 11%-30%. Interestingly, automakers appear split, with 45% expecting 10% or less of BEVs to have 800V packs and 49% predicting 21% or more will carry the high-powered packs.

Figure 3: What percentage of BEVs on the market in 2025 would you expect to have higher-voltage (800V) battery packs?

At the heart of whether consumers will accept BEVs is the need to reach cost parity with ICE vehicles, which is directly tied to the cost of the Li-ion battery packs themselves. That figure has dropped dramatically over the past decade, from about $1,000/kWh in 2010 to an average of about $133/kWh today. The U.S. Department of Energy’s U.S. Battery Consortium now is targeting $85/kWh for 2025, although some battery suppliers consider that a “stretch goal,” and Wards Intelligence survey respondents appear to agree.

Overall, industry insiders believe $90-$99/kWh is the sweet spot for battery costs in order to make BEVs price-competitive with ICEs in four years’ time. About a third of automaker and supplier respondents identify that as the right target, and it is the No.1 response of both suppliers and consultants. Automakers are slightly less convinced a sub-$100 cost will be necessary to spur sales, with 31% pegging the likely required range at $100-$119/kWh.

Pack Design

There are several variations among battery packs in use today, and design continues to evolve. As the industry installs electric propulsion systems in more midsize and larger vehicles, bigger packs with more modules are beginning to appear.

For example, GM will place 24 of its standard-size, pouch-type Ultium Li-ion cells in a single module, with cells stacked vertically or horizontally depending on the space restrictions in a floor pan. Ultium packs will contain anywhere from six to 24 modules, depending on vehicle size. For the large GMC Hummer SUV and pickup with its 200-kWh pack, there will be 24 modules, contained in two 12-module layers. But for a midsize CUV such as the Cadillac Lyriq, a single layer of 12 modules will make up its 100-kWh pack.

At the opposite end of the spectrum, Tesla intends to do away with modules and move toward a cell-to-pack configuration, making batteries a structural element of its BEVs. At a mid-October tour of its new Berlin Gigafactory, Tesla displayed a cutaway structural pack with its 4680 cylindrical cells aligned vertically. The pack will act as a platform, holding the cells and linking the front and rear castings of Tesla’s Model Y CUV.

While other OEMs have noted the complexity and added weight of modules, and potential overdesign of “boxes in boxes,” it doesn’t appear many legacy automakers are ready near-term to follow Tesla and move away from modular pack designs, which are seen as easier to assemble, service and disassemble for recycling.

Among the advantages, modules help contain swelling that can occur over time with popular nickel-manganese-cobalt (NMC) cells. Without modules, it is up to the pack or vehicle architecture itself to contain the compressive force. However, that’s not an impossible issue to solve. Tesla says its 4680 lithium-iron-phosphate cells offer better thermal management due to a tab-less electrode design that lessens internal resistance to electron flow. Volvo is at least one automaker planning to follow Tesla’s direction, with a cell-to pack design in the works for its third-generation BEVs.

Still, 38% of respondents surveyed say modular design will dominate packs going forward, with both automakers and suppliers leaning heavily in this direction. Only 12% of respondents think cell-to-pack design will take a firm hold in the future.

Showing more potential is the concept of structural packs. Both the Tesla pack and GM’s new Ultium battery pack are considered structural. The upcoming Hummer BEV has no conventional frame rails, “making the battery pack a fundamental structural element of the chassis,” GM says, adding shear panels above and below the pack protect it and “an exceptionally rigid floor” helps withstand body twisting. Volvo’s third-generation BEV pack also will be structural.

Respondents to our survey appear convinced structural packs are indeed the direction, but they are fairly split on when those designs will become dominant. Most point to 2025-2027 as the likely timeframe for structural battery packs to become the norm in BEVs, but that is closely followed by the 2028-2030 and beyond-2030 periods. Automakers predict faster movement toward structural packs than suppliers do. Few automaker and supplier respondents believe structural packs will not become prevalent.

Figure 4: When are structural battery packs likely to become the norm on battery-electric vehicles?

The dominant material for battery pack enclosures has been aluminum, followed by steel. However, composites have had some success as well, particularly in hybrid applications, and the composite industry is looking to take a bigger bite out of the BEV sector as cost and weight become higher priorities in pack design.

A 2020 study commissioned by The Aluminum Assn. shows BEVs have much more aluminum than ICE vehicles, at 643 lbs. (292 kg) vs. 450 lbs. (204 kg).

However, the study shows aluminum already has peaked in BEVs, forecast to drop to 629 lbs. (285 kg) per vehicle in 2026, in part due to expected introduction of smaller, shorter-range BEVs designed to appeal to more price-conscious car buyers. Those models are seen employing more mixed-material enclosures – including the use of composites – to cut weight and cost.

The trend toward mixed materials already is apparent in vehicles entering the market, such as the Ford Mustang Mach-E, which has a pack with an aluminum tray but a composite lid.

More than a third of survey respondents agree multi-material is the way forward, saying such enclosures will prevail in the market in 2025. Fully composite enclosures also likely will be in widespread use, say 27% of those surveyed. Automakers are particularly bullish on the material, with 36% predicting composites will be the top enclosure materials, followed by multi-materials, chosen by 28%.

Figure 5: What do you expect to be the dominant material for battery enclosures in 2025?

Not surprisingly, reducing cost is seen playing a huge role in pack design and materials, 61% of survey respondents say. Lightweighting, a critical factor in extending BEV range, and thermal management, a tougher task as cell energy densities increase, are the second- and third-most important factors cited, drawing responses from 42% and 40%, respectively.

Figure 6: What should be the top priorities in designing a next-generation battery pack? (Limited to three choices.)
However, suppliers diverge somewhat from automakers when it comes to choosing a design and material direction for packs, as they see safety as the No.1 factor, rather than cost. And although recyclability and sustainability are high on the list in guiding material choices overall, automakers consider manufacturability somewhat more important.
Figure 7: Which are the most important determining factors in selecting a battery-pack enclosure material? (Limited to three choices.)
As noted, lightweighting will be a huge factor in pack design going forward, but how much is the industry likely to achieve? A third of all survey respondents believe a 5%-10% mass reduction is achievable in next-gen BEV packs, with a more bullish 11%-15% mass reduction cited by the majority of consultants. Automakers also are eyeing slightly more aggressive targets than suppliers.
Figure 8: Weight is the enemy of range in a BEV. How much battery-pack mass reduction are automakers likely to achieve with next-gen BEVs?

A strong majority, 43% of survey respondents overall and 55% of automakers, say increasing cell power density will be the biggest contributor to weight reduction in next-gen battery packs, with more-efficient battery management a distant second (17%). The No.2 choice varies by company type, with suppliers believing pack enclosure materials to be the second-biggest contributor to weight reduction in next-gen packs. Consultants contend pack-design optimization is more important. Few respondents think more-efficient battery cooling will be a big contributor to weight reduction.

Figure 9: What do you believe will be the biggest contributor to weight reduction in next-generation battery packs?

MANUFACTURING

As BEV volumes increase exponentially over the next few years, manufacturing reliability and efficiency will become far greater concerns.

Today, the vast majority of BEV packs use NMC (nickel-manganese-cobalt) or NCA (nickel-cobalt-aluminum) Li-ion cells, but automakers, battery manufacturers and startups are pursuing more advanced chemistries – including lithium-metal and solid state – that in many cases promise greater energy density and all-around better performance.

If development is successful, automakers are likely to use these cells, with increased energy density, to lighten packs and decrease their size, according to the Wards Intelligence study. As one OEM executive says, increasing energy density is “the big knob that you can turn” to reduce pack weight, contending extending range much beyond expected near-term levels won’t be necessary to lure buyers into BEVs, while lowering costs will be.

Figure 10: When it comes to more-advanced cell technology on the way (such as solid-state), which of the following scenarios are most likely in terms of how battery packs will be designed and constructed? (Limited to three choices.)

Overall, 57% of survey respondents say lighter weight will be the biggest benefit of new chemistries, followed by smaller pack sizes (48%). However, automakers and suppliers have somewhat different views, with automakers more focused on simplifying pack design through new, more robust chemistries, selecting that as the No.2 benefit beyond lightweighting. Suppliers say decreasing pack size will be the second most-important benefit.

CONCLUSION

As the BEV sector grows and evolves, it’s clear packs will evolve with it. Automakers and suppliers are looking to create BEVs that travel further and charge more quickly than today’s models, which will necessitate newer cell chemistries and weight reduction methods. 

Among the findings in the Wards Intelligence study:

How to Use This Report

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Appendix

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about the Author
Gabriel Brown
Principal Analyst, Heavy Reading

Gabriel leads mobile network research for Heavy Reading. Starting from a system architecture perspective, his coverage area includes RAN, core, and service-layer platforms. Key research topics include 5G, LTE Advanced, virtual RAN, software-based mobile core, and the application of cloud technologies to mobile networking.

Gabriel has more than 15 years’ experience as a mobile network analyst. Prior to joining Heavy Reading, he was Chief Analyst for Light Reading’s Insider research service; before that, he was editor of IP Wireline and Wireless Week at London’s Euromoney Institutional Investor.