Northvolt’s factory, which is under construction, is set to be complete next year. The company is aiming to  (Image Credit: Northvolt)

 

European battery makers are getting ready to take advantage of huge “green” stimulus packages unveiled since the coronavirus pandemic. However, many recognize that it will be difficult to match the Asian battery giants that are currently dominating the mainstream market.

 

Companies like Sweden’s Northvolt and France’s Verkor are aiming for large-scale production. Other European companies are concentrating on niche markets and new technologies instead of taking on Chinese and South Korean firms that mass-produce EV batteries.

 

Firms like Sunlight, InoBat Auto and Switzerland’s Innolith say the challenge of constructing economies of scale that are quick to compete means finding niches is the best route to success. Sunlight, a Greek battery maker, is the world’s largest producer of lead-acid batteries for forklifts, energy storage systems and automated guided vehicles. The company is currently making a transition to lithium cells. Instead of taking on the EV market dominated by Amperex Technology, Panasonic, LG Chem, Samsung SDI and SK Innovation, Sunlight focuses on lithium-iron-phosphate (LFP) production. These types of batteries are generally used for forklifts, locomotives and robots performing short tasks with breaks in between.

 

China is currently home to 80% of the world’s lithium-ion cell production, which is the type of battery that’s expected to be utilized in EV’s.  Asian companies are contributing most of the capacity over the next five years. The European Union plans on investing $647 billion to climate protection and clean technologies over the upcoming seven years. These plans depend on renewable energy battery storage, which could power EVs in the future. Researchers have also found 13 European battery projects that could be qualified for EU support. These include countries like France, Germany, Slovakia and Poland, but some are motivated by Asian manufacturers, like LG Chem’s plans to expand its Krakow factory.

 

In the next five years, European EV production is expected to grow six-fold, and EU leaders expect the battery value chain to be worth 250 billion euros by 2025. However, some European startups admit that they won’t be able to catch up with Asian battery manufacturers. InoBat Auto, a startup in Slovakia, plans on adapting batteries for high-performance vehicles that may need it. The company plans on making a 100 MWh production line operable in 2021 in Slovakia near Peugeot, Kia Motors and Jaguar Land Rover’s plants. InoBat’s battery chemistry testing is expected to take place at these plants. The company is expected to develop prototypes modified to each of the carmaker’s needs.

 

Analysts say the next gen-batteries need to last longer, charge quicker, be safer and environmentally friendly than the ones on the market.

 

Later this year, Innolith plans on having prototypes in its labs in Germany for an NMC 811 cell that delivers up to 315 Wh/kg. These NMC 811 cells contain less cobalt than the majority of mainstream EV batteries, allowing them to deliver more power and with less costly components. As it stands now, Northvolt is the only startup in Europe that has the size to take on the Asian giants, and its first factory hasn’t started production. The company wants 25% of the battery market in Europe, a goal that requires 15 GWh of production. That’s over three times Europe’s lithium-ion capacity.

 

Northvolt is set to open its first 40 GWh plant in Sweden sometime next year. A joint venture with Volkswagen in Germany promises to follow in 2024 with a capacity of 24 GWh. Northvolt has made deals to sell production worth 13 billion euros. Meanwhile, Verkor plans to construct a 16 GWh lithium-ion battery factory in southern Europe by 2023.

 

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