Saft Alliance Takes Aim at Asia's Dominance in Lithium-Ion Battery Manufacturing


Saft, the 100-year-old French battery maker now owned by Total, last month unveiled an alliance aimed at taking on Asia’s dominance in the lithium-ion market.

The alliance, which includes chemicals firm Solvay, battery assembly specialist Manz, industrial giant Siemens and “other leading European companies,” will embark on an ambitious program of research to develop the “battery of the future.”

The program will be focused on creating advanced high-density lithium-ion and solid-state batteries for electric vehicles, energy storage and sectors such as defense and electronics, where Saft already has a substantial foothold. 

“These new generation batteries will provide performance, cost and safety advantages compared to current lithium-ion products,” promised the battery maker. 

Rory McCarthy, a London-based senior energy storage analyst with GTM Research, said it will not be easy to challenge Asia’s dominance in lithium-ion, though.

“The Europeans have historically been successful in some cleantech areas, such as wind turbine manufacturing,” he said. “However, in power electronics [areas] such as battery manufacturing and capability, the Asian markets are light years ahead.”

Wood Mackenzie data shows Asian firms currently manufacture around 70 percent of global lithium-ion cells, McCarthy noted. Asian markets are also rapidly scaling up manufacturing facilities to snap up global battery market share as demand increases, he said. 

Last year, for example, China pushed to deliver an almost threefold increase in global graphite processing capacity by 2020, to meet demand for batteries from electric vehicles and energy storage. 

“This European alliance shows that these players understand the scale of the challenge and have concluded that together they can be greater than the sum of their parts,” McCarthy remarked. 

According to Reuters, Saft’s alliance is the result of a European Commission attempt to develop “an Airbus-style consortium” for battery manufacturing last October. 

The consortium initiative, launched by Maroš Šefčovic, the European Commission vice-president in charge of the Energy Union, saw interest from Saft and Siemens as well as chemical group BASF and carmakers Daimler, Renault and Volkswagen. 

“Saft said the alliance was not exclusive and the companies would work together over the next seven years to reach a common goal,” Reuters reported

However, Axel Bartmann, head of marketing and corporate communications at Manz, said other European battery makers would not be allowed into the club. “They are in competition,” he said.

Saft’s alliance also appears to be separate from industry bodies such as the European Association for Storage of Energy, which declined to comment on the announcement. 

While the extent of partnerships behind the initiative remains to be seen, “to build European leadership in this domain…the Alliance will need strong regulatory support and appropriate funding from European and national authorities,” Saft said. 

Last October, The Financial Times reported that the European Union was willing to put up to €2.2 billion ($2.7 billion) into its consortium plans.

Bartmann confirmed “support and success of research [and] buildup of mass-production knowhow as well as production and quality specialists” would be important for the alliance. 

Even with the full support of the European Union, though, creating a breakthrough battery technology will be easier said than done. 

German industrial giant Bosch, which was also working on a solid-state lithium-ion battery design, pulled out of manufacturing this month due to growing competition from Asia. The company had estimated it would need to spend an additional €20 billion (USD $24 billion) to reach its target of creating 200 gigawatt-hours of manufacturing capacity a year. 

Saft and its alliance partners appear to be aiming for a highly versatile technology that can be used in anything from power tools to electric buses. “Applications all depend on the energy density of the final product, if they can crack it,” said McCarthy. “The general drive toward solid state is increased energy density and a safer product, by removing the flammable electrolyte element from the battery cell and replacing it with a solid material.”



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