Other major automotive manufacturers like Toyota and Volkswagen are pouring billions into developing solid-state battery technology. This historic shift is poised to fundamentally transform the EV production landscape. Businesses such as Volkswagen, Mercedes-Benz Group, Stellantis, BYD, Nissan, and Toyota are investing billions of dollars into this exciting technology. This breakthrough has the potential to enhance vehicle performance and reduce reliance on supply chains controlled by China today.
Solid-state batteries have many benefits compared with conventional lithium-ion batteries, such as better energy density, safety and charging speed. By localizing production, Western automakers aim to decrease their dependence on Chinese suppliers, an issue that has become increasingly critical amid geopolitical tensions. Meanwhile, consumer interest in EVs is through the roof. If nothing else, these companies are quite literally positioning themselves to lead when we enter the next era of battery technology.
Earlier this month, Mercedes-Benz Group and Stellantis reaffirmed their plans to produce solid-state batteries. Stellantis, as the company was renamed in 2021, is perhaps best known for its Jeep and Chrysler brands. Recent accounts suggest that LG Chem, working with BMW and other major players, have moved up their timelines for commercial production. The mass output of solid-state batteries is projected to take place before the end of this decade.
In an interesting additional development, BYD recently introduced a super-fast charging system as a new frontier to use alongside its battery technologies. This breakthrough is particularly timely, arriving just one month before solid-state battery breakthrough announcements from other manufacturers—including an undisclosed American company—began surfacing. China’s CATL has standardized the use of a lithium-ion phosphate (LFP) battery. After five minutes charging, it offers a healthy driving range of 520 kilometers, that’s roughly 323 miles.
Looking back over the past few months, the industry made great strides. During the latter half of last year, Nio and IM Motors debuted the world’s first oxide-based semi-solid-state EVs. This environmental breakthrough is showing us that the tide may be turning on what consumers want. Rho Motion, a U.K.-based energy asset research and consultancy firm, identified these launches as key catalysts that have helped to re-inject momentum into the sector.
Various analysts are closely monitoring these developments. According to Fastmarkets’ battery raw materials analyst, there’s a lot of good momentum happening but it’s not without its challenges. Connor Watts highlighted that “negative sentiment has been exacerbated by Western leaders like VW-backed Quantumscape delaying their product offerings and shifting timelines following persistent technological problems.” This confluence of circumstances has produced a prevailing air of challenge for the industry even in the face of continued innovation.
Nissan’s CEO Ivan Espinosa was heartened with cautious optimism for the promise of solid-state battery technology. He emphasized the need for careful timing when investing in new technologies:
“We keep working on it and we keep with the plan. The question is whether the market will be ready for that and at which moment you invest heavily on deploying this kind of technology. This is what we are looking at very closely.”
Espinosa noted the importance of striking a balance between technological progression and market readiness:
“You don’t want to over-engage with investments when the market is not ready to welcome the new volume that you might need to have a healthy business. So, technology-wise, we keep working, and we are on track, but probably we need to have a very careful look at the right moment to start implementing massively in this technology.”
Stellantis has taken a broadly strategic view, working with Factorial Energy, which specializes in semi-solid-state cells. Industry experts indicate Stellantis’ first products will use hybrid technologies and not fully solid-state solutions. Iola Hughes observed that “they’re not only investing heavily in R&D and prototype testing but diversifying their risk through multiple partnerships.”
Despite the fanfare about solid-state batteries, there are still major hurdles ahead. Another reason that advanced batteries are not as attractive to automakers is their cost, which is significant. At the same time, proven technologies are rapidly catching up in a big way. Watts stated:
“If the promises of solid-state batteries don’t improve while incumbent technologies catch up, the value proposition and investment case weakens significantly.”
Most other automotive companies are shooting for commercial production by 2027 or 2028. Even the most advanced companies aren’t necessarily working on fully solid-state solutions, but rather, semi-solid solutions. Hughes elaborated on this trend:
“Semi-solid batteries offer improved energy density and safety over conventional lithium-ion cells and are easier to manufacture, making them a practical bridge toward solid-state technology.”
She warned that these semi-solid solutions do not yet approach the full performance promise of true solid-state batteries. Their energy density and their scalability are where they fall short.
With competition fiercer than ever, automakers are going to have to contend with not just the technology landscape, but the market landscape. The race to solid-state battery production will likely shape the future of electric vehicles and redefine relationships in global supply chains.