can hardly browse a tech or automotive news site these days without
being overwhelmed by a deluge of electric car news. From
Prius, to the Chevy
Volt, to the sexy
Porsche plug-in concept, there's a wealth of designs; in fact
every major automaker has unveiled a plug-in or electric concept in
some form over the past few years.As the automakers race to
beat each other to market and achieve the lowest price point in their
target sector, an integral component is the lithium-ion batteries
that store the energy that powers the vehicle's electronic propulsion
systems. Recent studies have indicated that
lithium resources to survive the electric vehicle (EV)
boom. However, a new study by automotive strategy consultation
firm Roland Berger and Wolfgang Bernhart, an expert on alternative
energy powertrains, says that the EV battery industry may be headed
for trouble.The industry's aggressive production
increases and cost cuts will likely fuel an unsustainable business
model, according to Roland Berger. It predicts that by 2015
there will be demand for 0.82 million "EV equivalents" (a
number representing the diverse production population of hybrids and
electric vehicles). Installed capacity they predict will be 2.6
million EV equivalents. By 2018 demand will likely jump to 3
million EV equivalents yearly.By 2015, they predict that
there will be a 200 percent overcapacity in batteries. That
overcapacity will be worsened by international government grants,
which will push for more investment.The result will be that
many companies will go extinct, states the consulting firm.
Describes Mr. Bernhart, "Manufacturers of lithium-ion (Li-ion)
batteries currently enjoy a great amount of hype, but massive
consolidation is expected to come in the next 5 to 7 years."He
estimates that in 2015 a new cell chemistry will cost approximately
€50-100M (approximately $65-135M USD), while a new 100,000 unit
plant would cost €350M ($475M USD) to construct.He says
that despite the threat to companies like LG Chem and A123
Battery Systems, there is hope for those that can weather the
overcapacity storm. He describes, "Unfavorable factors are
piling up. But managed correctly, electrified powertrains will still
be a profitable market in the future."
quote: The problem is that numerous battery manufacturers have popped up to try and fill the gap that was created by demand for batteries.
quote: And the demand for batteries was created by the government when they decided to start subsidizing hybrid and electric vehicles.
quote: Restricting domestic energy exploration.
quote: Providing subsidies and grants to "green energy"
quote: Threatening to increase taxes on conventional energy sources.
quote: And the demand for batteries was created by the government when they decided to start subsidizing hybrid and electric vehicles. Other aspects of this problem that are directly created by the government include:
quote: - Restricting domestic energy exploration.- Providing subsidies and grants to "green energy"- Threatening to increase taxes on conventional energy sources.
quote: Without these four factors the automotive lithium ion battery industry would be virtually non-existant. Maybe you should also review the problem before stating that it "has nothing to do with the government."
quote: It predicts that by 2015 there will be demand for 0.82 million "EV equivalents"