Hyperdrive Daily: A cheaper, cobalt-free battery
Welcome to the daily Hyperdrive briefing that will decipher the revolution that is reshaping the automotive world, from electric vehicles to self-driving cars and beyond.
Step aside cobalt
I will get out of here. Let’s talk about battery chemistry. Automakers and battery suppliers are in an R&D race for the next low-cost battery. The only measure that is increasingly seen as the fastest way to reduce battery costs is to reduce or replace the cobalt content in a battery. The alternative to this could be manganese.
Here’s why. The average 84-kilowatt-hour battery – the size of the pack in a Tesla Model 3 or Volkswagen ID.4 – costs about $ 11,000 per car. No internal combustion engine costs that much. Even without an engine, fuel and exhaust system, EVs have a significant cost disadvantage. Hence the race to lower battery prices.
The batteries are made up of a handful of important metals: cobalt, nickel, lithium, manganese, aluminum and iron. Cobalt is one of the most expensive at $ 45,000 per ton. Most EV batteries today are made up of 20% cobalt. That means the item represents about $ 850 per vehicle in that 84 kWh battery in the ID.4, according to LMC automotive analyst Sam Adham. This is real money.
When General Motors announced its Ultium battery a year ago, the company bragged that it would cost less than $ 100 per kWh because it would use much less cobalt. That is still too high – to achieve cost parity with a vehicle with an internal combustion engine, according to BloombergNEF, less than $ 80 per kWh must be achieved. In a battery with 20% cobalt, the metal is about $ 10 per kWh.
Because of this, VW, Tesla, and China’s SVOLT are looking for batteries that will replace cobalt with manganese, which costs less than $ 2,000 a ton. Not only is it cheaper, but neither is the price fluctuate as much as cobalt. From 2011 to 2016, cobalt was in the $ 30,000 / tonne range. Then it skyrocketed from 2016, rising to $ 115,000 per ton in April 2018. It has declined since then, but recently surged over $ 65,000 before settling at $ 45,000, according to BNEF. Car manufacturers cannot live with such price fluctuations. Manganese prices, on the other hand, have mostly remained stable for a decade.
Manganese is not the perfect element – there are many questions about its use in batteries: Can it maintain the same power density? And what about the loss of the stabilizing presence of cobalt – the element prevents thermal runaway or fires. “RResearchers are confident that these hurdles can be overcome, ”says LMC’s Adham.
We haven’t even touched on the sensitive issue of where these metals come from. The Democratic Republic of the Congo is the largest producer of cobalt, followed by China and Australia. Given ethical concerns about the Congo, not to mention its political stability, automakers have worried. China is also striving to become a leader in battery and EV technology, leading to possible supply shortages for cobalt in the future.
Volkswagen said in March that it will use high-manganese batteries for high-volume cars and even cheaper, cobalt-free chemistry for its entry-level models. Tesla also plans to use manganese to make its promised Tesla affordable at $ 25,000.
South Africa has the highest known reserves, according to LMC’s Adham, followed by Brazil and Australia. Are the automakers headed in that direction?
“The automakers are over it with fog and night,” said Adham. “I suppose that means they are on to something.”
Before you go
Our colleagues Lizette Chapman and Brad Stone recently traveled to Santa Cruz, California to visit Joby Aviation, the flying car startup that is one of dozens of companies that work for the company change the way people get around.
Joby, with a healthy investment volume – Toyota has invested nearly $ 400 million in the company – is building what is known as an eVTOL, an electric airplane that takes off and lands vertically. It looks less like science fiction car fantasies and more “a buzzing insect big enough to carry a few human passengers”. Read more about the highlight of the reporting trip: seeing the prototype in action.
(Corrects the price per vehicle of cobalt in the third paragraph.)