Revenge of the Electric Car

I wrote a few months ago about the Japanese and European carmakers teaming up with Asian and Euro battery manufacturers with $200-$400 million deals to build large production facilities that will soon be cranking out high volumes of LiIon batteries for plug-in cars.  Since achieving cost parity with internal combustion requires batteries to cost less than $500 per kWh, this is a welcome sign that we’ll be seeing those prices in short order.

In recent months however, many experts have spoken of the need for battery production within the U.S.  It’s one thing to switch from mostly foreign oil to 100% domestic electricity, but it’s also important to have a domestic source of batteries. The big Euro and Asian car makers are going to soak up most of the world’s production, a feat easier done when they own the factories making the batteries.

As this article explains, we now have movement toward a domestic supply. One can only guess where we’d be had this started a decade earlier.

As they say, “It’s all about the batteries.”

See the LA Times article:
U.S. Battery Makers Work to Power Up

A coalition of 14 companies this week announced the creation of a new business alliance aimed at promoting domestic production of lithium ion batteries. Automakers hope to use the batteries in next- generation hybrids as well as plug-in electric cars.

Industry consultants say U.S. companies are losing a race to commercialize the technology to rivals in Asia and Europe. General Motors has said it might use foreign-produced batteries in the Chevrolet Volt, the plug-in scheduled for production in 2010.

The coalition – known as the National Alliance for Advanced Transportation Battery Cell Manufacture – is based in Chicago. The Energy Department’s Argonne National Laboratory, located in suburban Chicago, has also signed on to the project.

The alliance includes battery giant Johnson Controls and smaller players in the field such as ActaCell, Altair Nanotechnologies and Dontech Global.

Here is the complete text of the article – in case the link goes bad:
http://articles.latimes.com/2008/12/20/business/fi-battery20

U.S. Battery Makers Work to Power Up
LA Times, December 20, 2008

Fourteen companies join to promote domestic production of lithium ion batteries for autos. They will seek federal funding to build at least one prototype development center.

December 20, 2008 U.S. battery manufacturers are taking steps to raise the industry’s profile, a move that backers hope will speed commercialization of high-tech, American-made car batteries.

A coalition of 14 companies this week announced the creation of a new business alliance aimed at promoting domestic production of lithium ion batteries. Automakers hope to use the batteries in next- generation hybrids as well as plug-in electric cars.

Industry consultants say U.S. companies are losing a race to commercialize the technology to rivals in Asia and Europe. General Motors has said it might use foreign-produced batteries in the Chevrolet Volt, the plug-in scheduled for production in 2010.

The coalition – known as the National Alliance for Advanced Transportation Battery Cell Manufacture – is based in Chicago. The Energy Department’s Argonne National Laboratory, located in suburban Chicago, has also signed on to the project.

The alliance includes battery giant Johnson Controls and smaller players in the field such as ActaCell, Altair Nanotechnologies and Dontech Global.

James Greenberger, a Chicago attorney who is leading the alliance effort, said the group would seek to develop one or more manufacturing and prototype development centers in the United States. The centers could carry a total price tag of between $1 billion and $2 billion over the next five years. The group hopes to get much of the money from the federal government.

“We think this is the most effective way that government can leverage public money to both establish lithium ion battery manufacture in the United States and revitalize the automotive industry in the long term,” Greenberger said.

Alex Molinaroli, president of Johnson Controls’ power solutions division, said the alliance could help promote the industry as a source of new high-tech American jobs.

“I don’t think it’s good enough that the American consumer is going to have a vehicle that’s electrified or have hybrid capabilities,” he said. “It doesn’t help us if we have no capability in the U.S.”

The alliance took its message to Congress this week, as staffers from at least four House members from Illinois took part in a conference call with the group. A staff member from the office of Sen. Richard Durbin (D-Ill.) also participated in the call. Greenberger said he had been working to inform aides to President- elect Barack Obama as well.

Battery executives and industry consultants say governments in Japan, China, South Korea and Germany are pouring hundreds of millions of dollars into production of lithium ion batteries, which have chiefly been used in cellphones, laptops and other electronics.