Study Finds Asian Companies Leading in Li-ion Battery Development

Research is still under way to develop safer, more efficient lithium cells, although CLSA notes the primary bottleneck to Li-ion battery usage in vehicles is material costs.

Mack Chrysler, Correspondent

November 5, 2008

5 Min Read
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In the race to produce more fuel-efficient vehicles, Asian manufacturers are ahead in a critical area, one recent study finds.

CLSA Asia-Pacific Markets reports Japanese, Korean and Chinese companies are leading the way in the research, development and production of lithium-ion batteries, successors to the current lead-acid and nickel-metal-hydride types.

“Battery technology is the chief bottleneck to developing mass-market electric vehicles, which we see as the long-term answer to eliminating carbon emissions and oil dependence,” the study says.

Li-ion batteries are a key element in the plug-in hybrid-electric vehicles and extended-range EVs that auto makers such as General Motors Corp., Toyota Motor Corp., Chrysler LLC, Mitsubishi Motors Corp., Nissan Motor Co. Ltd. and Hyundai Motor Co. Ltd. plan to offer over the next coming years, starting with the Mitsubishi i-MiEV in 2009.

The batteries also will be used in future fuel-cell vehicles, such as Honda Motor Co. Ltd.’s FCX Clarity prototype now being leased in limited numbers in California for real-world testing.

The CLSA study notes that since Sony Corp. released the first commercial Li-ion battery in 1991, there has been steady growth in this market. “Worldwide demand has expanded more than four-fold since 2001, but that growth mostly is attributable to portable electronics such as notebook computers, mobile phones and digital cameras.”

Mitsubishi i-MiEV to be first EV to market.

Manufacturers now have their sights set on the automotive market where demand for electric vehicles, mostly in the form of HEVs, still accounts for only 2% of new-car sales but compound annual growth since 2000 has been nearly 70%. Both governments and suppliers are making a multi-billion-dollar effort to improve Li-ion batteries for the automotive sector.

For example, CLSA says the U.S. government will spend $4.5 billion on research and development of Li-ion batteries and related renewable-energy technologies. Sanyo Electric Co. Ltd. is planning to spend more than $1 billion on the battery technology development and production over the next three years.

Though still imperfect, Li-ion batteries are light and have a longer lifespan than lead-acid batteries. However, they lack the energy density needed by more advanced EVs and are expensive.

A NiMH battery, weighing 121 lbs (55 kg), provides 1.3 kWh capacity. This is far less than the estimated 16 kWh needed for 40 miles (64 km) of pure electric drive which would require a NiMH battery weighing 1,485 lbs. (675 kg) and costing roughly $17,000.

Consequently, the CLSA study concludes that Li-ion batteries “are the most immediately realizable solution to power the next generation EVs,” despite drawbacks. These include the need to monitor temperature and electric current carefully to maintain safety and prolong lifespan and to prevent uncontrolled discharge, release of flammable gases, and over-heating.

Research is still under way to develop safer, more efficient cells, although CLSA notes that the primary bottleneck to Li-ion usage in vehicles is material costs.

The favored cathode, presently lithium-cobalt-oxide, is roughly 50% of current lithium-cell cost. Cobalt used in cathodes is priced at $30 per lb. ($65 per kg) compared with nickel at $17 per lb. ($37 per kg).

The CLSA study estimates the Li-ion battery pack in the $100,000 Tesla roadster EV cost $20,000 and weighs 990 lbs. (450 kg), compared with NiMH batteries in current hybrids weighing 121 lbs. (55 kg) and priced at $2,500.

Researchers are seeking a less-expensive cathode material, such as manganese, lithiated iron oxide or mixed metallic oxides with lower cobalt content but no practical alternative to lithium cobalt-oxide has yet been found, the study says.

Most of the world’s Li-ion battery production is in Asia where Japanese companies have led development. Three major cell makers account for 47% of total global sales, Sanyo Electric with 22%, Matsushita Electric Co. Ltd. (13%) and Sony (12%). South Korea’s Samsung SDI Co. Ltd. (14%) and LG Chemical Ltd. (8%) plus China’s BYD Auto Co. Ltd. (10%) provide another 32% of the total.

“It’s likely that automobile assemblers, with strong incumbents in the U.S. and Europe, will eventually be sourcing (Li-ion) batteries from Asian players,” the study says. “NiMH batteries will still be installed in most upcoming HEVs and will continue to be the prevailing battery technology for the next three years, but will likely lose market share to (Li-ion) after that point.”

The study concludes Li-ion batteries will start to make an impact on the market in 2010 when auto makers hope more economical and practical cells will be ready for plug-in hybrids and extended range EVs, including the Chevrolet Volt.

However, Honda still has reservations. “Lithium-ion batteries are still not usable from our perspective,” President Takeo Fukui is quoted as saying. “In terms of reliability and durability, I must say there still remain some concerns. I don’t think they are necessarily best-suited for mass-produced vehicles.”

Toyota has similar reservations about mass-produced vehicles and has said it’s sticking with NiMH batteries for its next-generation Prius, which launches in 2009. However, the auto maker does plan to use Li-ion technology in its Prius plug-in to be introduced in late 2009.

The CLSA cautions as well that “despite much positive momentum toward electric vehicles, there is always the possibility that clean diesel engines, biofuels(s) or some other alternative fuel-efficient technology will take the lion’s share of future green growth.”

Nonetheless, the study forecasts global Li-ion battery sales will rise 35% from 2.45 billion units in 2007 to 3.77 billion units in 2012, while the value of sales will increase 32% in the same period, from $7.85 billion to $10.38 billion, with portable electronics accounting for most of the volume.

Near-term, CLSA expects the automotive sector’s share of the Li-ion battery market to be minimal, an estimated 5% by 2010. But this share is expected to expand significantly to an estimated 36% by 2015.

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