Dear battery enthusiast,
Welcome to Battery Associates’ December newsletter. We have summarised some of the month’s most relevant news, highlighting recent developments and updates in the battery space.
B.A's Battery Newsletter:
Battery Industry Highlights
B.A Editorial
Battery Insiders Podcast
Battery Associates’ Events & Updates
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Battery Industry Highlights
In this section, we summarise relevant battery news from the past month.
On December 10, Stellantis and CATL announced plans to invest up to €4.1 billion in a large-scale lithium iron phosphate (LFP) battery plant in Zaragoza, Spain. Once completed, the facility will have an annual battery production capacity of 50 GWh and is expected to begin serial battery production by late 2026. The project is a 50:50 joint venture between Stellantis and CATL. The partners stated that the battery plant will be developed in multiple phases as part of the investment plan.
B.A Commentary: LFP cell chemistry is one of the fastest-growing battery technologies due to its affordability. However, this technology has been predominantly developed by Chinese battery companies. Stellantis initially planned to expand its European footprint through partnerships with Mercedes-Benz and Total Energy. Together, they announced plans to establish the Automotive Cells Company (ACC), focused on NMC cell chemistry, and successfully opened their first NMC cell manufacturing plant in France. However, later, ACC announced that its planned facilities in Germany and Italy had been halted. Following this, Stellantis revealed a landmark investment with CATL to manufacture LFP cells in Spain, marking a significant step toward advancing LFP technology in Europe.
According to media reports, on December 13, CATL, the world's largest battery manufacturer, announced plans to provide financial support to its suppliers to accelerate innovation in battery materials and equipment. This initiative aims to alleviate supply chain pressures amid intense price competition in the electric vehicle (EV) market, particularly in China. The support includes covering part of suppliers' research and development costs, making advance payments, and assisting with certifications to expedite the application and production of new battery materials.
B.A Commentary: The ongoing price war in China's electric vehicle (EV) market, driven by fierce competition and aggressive discounts from industry leaders like BYD—poised to outsell global giants like Ford and Honda—exemplifies the pressure automakers face to cut costs to maintain market share. This intense pricing environment is now rippling through the supply chain, with BYD urging suppliers to lower prices further, signalling an escalation in cost-cutting measures. Following this trend, CATL is also providing financial aid to its suppliers to accelerate R&D innovation in materials, aiming to eventually reduce costs and remain competitive in domestic and international markets.
On December 02, General Motors entered into a non-binding agreement to sell its stake in the Ultium Cells EV battery plant in Lansing, Michigan, to its joint venture partner, LG Energy Solution. The 2.8-million-square-foot facility, nearing completion, will have an annual production capacity of 41 GWh. The agreement grants LG Energy Solution immediate access to the plant to install battery cell manufacturing equipment. The transaction, expected to close in Q1 2025, will allow GM to recoup its share of the $2.6 billion investment in the facility.
On December 02, General Motors entered into a non-binding agreement to sell its stake in the Ultium Cells EV battery plant in Lansing, Michigan, to its joint venture partner, LG Energy Solution. The 2.8-million-square-foot facility, nearing completion, will have an annual production capacity of 41 GWh. The agreement grants LG Energy Solution immediate access to the plant to install battery cell manufacturing equipment. The transaction, expected to close in Q1 2025, will allow GM to recoup its share of the $2.6 billion investment in the facility.
B.A Commentary: This can be seen as part of GM's broader cost-cutting strategy for 2024. While the company is selling its stake in the Michigan facility, it retains stakes in its other two cell manufacturing plants in Warren, Ohio, and Spring Hill, Tennessee. GM is targeting $2 billion in fixed cost reductions this year as it faces slowing U.S. sales, challenges in the Chinese market, and a recalibration of its "all-in" electric vehicle strategy due to slower-than-expected consumer adoption.
Slovak battery manufacturer InoBat has secured €100 million in its latest funding round, marking the largest investment for a technology company in Slovakia. The round was led by Chinese partner Gotion High Tech and included contributions from Slovakia's sovereign wealth fund, Lilium, Bromo Capital, IPM Group, and Cielo Capital.
B.A Commentary: InoBat plans to use the funds to scale up battery cell production, initiate an energy storage business, and expand operations across Slovakia, Serbia, and Spain. The company has a joint venture with Gotion to build European gigafactories, aiming to strengthen Europe's position in the EV battery industry.
On December 3, 2024, China announced stricter export controls on certain types of graphite and a complete export ban on key minerals, including gallium, germanium, and antimony, to the United States, citing national security concerns. The enhanced scrutiny on graphite requires exporters to obtain special licenses, while the outright bans target materials critical for semiconductors, EV batteries, and infrared technologies.
B.A Commentary: China's tightened export controls on graphite and bans on gallium, germanium, and antimony follow the U.S.'s latest semiconductor crackdown. On December 2, 2024, the U.S. imposed its third wave of restrictions, targeting 140 Chinese companies, including Naura Technology Group. In response, the American Active Anode Material Producers, a coalition of U.S. and Canadian graphite manufacturers, urged the U.S. Department of Commerce and the International Trade Commission (ITC) to impose tariffs of up to 920% on Chinese suppliers of battery-grade graphite. The group argued that the existing 25% U.S. tariff on most Chinese graphite is "far too low" and easily absorbed by Chinese competitors, enabling what they describe as Beijing's "malicious trade practices."
Exclusive Summary
BYD and CATL Drive Aggressive Cost-Cutting Amid Intense Competition
The ongoing price war in China's electric vehicle (EV) market is driven by fierce competition and aggressive discounts from industry leaders. In November, Chinese EV manufacturer BYD asked its suppliers to cut costs by 10% as competition intensifies both in its domestic market and internationally. Leveraging its fully vertically integrated battery supply chain, BYD maintains significant control over margins across its upstream operations.
Battery manufacturing costs are heavily influenced by materials like cathodes and anodes, which account for around 40% of the total cell cost. In China, battery material manufacturers typically see 5-8% net margins, with cathode manufacturers enjoying slightly higher margins than anode suppliers. However, these margins are highly volatile, and are impacted by various factors, such as order volumes, market conditions, and supply-demand dynamics. For a typical 1 kWh battery pack, 5-10% of the cost is directly tied to the net profit margin of battery material manufacturers, making it a critical area to manage. Following BYD's cost-cutting trend, CATL has announced various initiatives to support its cell suppliers by accelerating innovation, enhancing process efficiency, and investing in material R&D. These measures aim to help suppliers cut costs and remain competitive in a challenging market.
The cost-cutting measures by BYD and CATL highlight the high stakes in the global EV and battery race. While these strategies may drive short-term competitiveness, balancing cost efficiency with innovation and supply chain stability will be crucial for long-term success.
BatteryMBA May 2025 Cohort
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Battery Insiders Podcast
Battery Associates runs a podcast called Battery Insiders, which covers the role of batteries for sustainable development and battery-relevant topics featuring a range of battery experts and enthusiasts.
Talk on: Exploring Hytzer solid-state batteries
Speaker: Dr Xi Dou, Co-Founder & CEO of Hytzer Energy
Session Summary: In this episode, Dr. Xi Dou, co-founder and CEO of Hytzer Energy, discusses the current state and future potential of solid-state batteries (SSBs). He highlights their advantages, including higher energy density, much higher power density and intrinsically improved safety compared to traditional lithium-ion and other solid-state batteries, and explains the scientific and manufacturing challenges that hinder solid-state battery's commercialization in general. The conversation touches on the root causes of thermal run-away mechanism in conventional lithium-ion batteries and highlights why solid-state batteries address this safety issue; cost reduction potential, with polymer-based SSBs being more compatible with existing production lines. Dr. Dou also outlines key market applications with stringent safety requirements and demanding performance, such as flying taxis and premium electric vehicles. He further describes ongoing innovations, including advanced designs of lithium-metal anodes and anode-free batteries. He concludes with insights into future advancements, including batteries with energy densities exceeding 500 Wh/kg, and the readiness of large-format SSBs for commercial applications. Click on the image below to listen to the full conversation.
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