chemicals & materials are key to the success of electric vehicles
TRANSCRIPT
Chemicals & Materials are the Key to the Future Success of Electric Vehicles
Brian Balmer, Industry PrincipalRobert Outram, Research Program Manager
Chemicals & Materials in Transportation
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Highlights
• Introduction to Electric Vehicles• Electric Vehicle Market & Forecast• Drivers & Restraints• Regional Analysis• EV Batteries Market Forecast• Value Chain• Project Case Studies
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The Context
The need to enhance functionality &
performance
Globalisation of people, products and processes
Development of a low carbon economy
Improvements in health & wellness
Construction & Utilities
Food, Drugs & Cosmetics
Transportation
Chemicals &Materials
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Mega Trends Create Opportunities and Threats for Chemicals and Materials
Primary research through the global value chain, technology and legislation drivers, qualitative and quantitative analysisPrimary research through the global value chain, technology and legislation drivers, qualitative and quantitative analysis
Drive to lower CO2 emissions
UrbanisationGlobalisation
Growth in electric vehiclesNew OEMs emergingSmaller, lighter, greener vehiclesHigh speed rail50% of automobile sales from BRIC
Opportunities for:PolymersBattery materials and
chemicalsGreen fuels and lubricantsAdvanced adhesives
Threats to:MetalsMetal treatment & coatingGlassAdditives for fossil fuels
Mega Trends
Transportation Trends
Impact for Chemicals and
Materials
Mega Trends
Transportation Trends
Impact for Chemicals and
Materials
• Drive to lower CO2 emissions
• Urbanisation• Globalisation
• Growth in electric vehicles• New OEMs emerging• Smaller, lighter, greener vehicles• High speed rail• 50% of automobile sales from BRIC
Opportunities for:• Polymers• Battery materials and
chemicals• Green fuels and lubricants• Advanced adhesives
Threats to:• Metals• Metal treatment & coating• Glass• Additives for fossil fuels
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Electric Vehicles –Battery Chemicals to be One of the Key Factors Enabling the EV Revolution
Battery MaterialsLaminatesElectrodesElectrolytesCasing
TransmissionCooling fluidsGear oilsClutch fluids
Electronics/wiringHigh tension cablesCharging portsCable sheaths
Passenger comfortHeaters (as no heat from engine)Insulation of interiors
Chassis and skinsLightweight plasticsCompositesBioplastics
GlazingPanoramic roofSide windowsPolycarbonatesAcoustic laminates
Rolling resistanceTyre additives
Battery MaterialsLaminatesElectrodesElectrolytesCasing
TransmissionCooling fluidsGear oilsClutch fluids
Electronics/wiringHigh tension cablesCharging portsCable sheaths
Passenger comfortHeaters (as no heat from engine)Insulation of interiors
Chassis and skinsLightweight plasticsCompositesBioplastics
GlazingPanoramic roofSide windowsPolycarbonatesAcoustic laminates
Rolling resistanceTyre additives
EV Market: Opportunities for Chemicals and Materials (World), 2010-2016
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Electric Vehicles and Material Demands Vary by Category
Electric Vehicles
Electric vehicles use electric motors instead of an internal combustion engine (ICE) to propel a vehicle. The electric power is derived from a battery of one of several chemistries, including lead acid, nickel metal hydride (NiMH) and lithium-ion (Li-ion).
Neighborhood Electric Vehicles (NEVs)
NEV is a US Department of
Transportation (DOT)
classification for vehicles
weighing less than 3,000 lbs
(GVW) and having a top speed
of 25 mph. NEVs are restricted
to run on streets where the
speed limit is 35 mph or less.
A city car is a European
classification for small and light
vehicles intended for use in
urban areas although they can
operate in mixed city/highway
environment. In Japan, city
cars are called kei cars.
Extended-range Electric Vehicles (eREVs)
These are plug-in hybrid
electric vehicles (PHEVs) with
an ICE or other secondary
sources connected to a
generator to supply power to
batteries. Their drive range
and speeds are comparable to
those of ICE vehicles.
High-performance Electric Vehicles (HPEVs)
These are sporty PHEVs or
battery electric vehicles
with top speeds exceeding
100 mph and driving range
exceeding 100 miles. Their
price is expected to reach
or exceed $100,000
GEM e2, e4 and e6, REVA
G-Wiz I, ZENN, ZAP etc
Smart EV, Th!nk City, BMW
Mini and others
Chevy Volt, Toyota Prius
PHEV, Chrysler Sedan and
others
Tesla, Venturi’s Fetish and
Lightning GT
City Electric Vehicles (CEVs)
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Global Electric Vehicle Demand Analysis – Potential Sales of 2.2 M in Frost & Sullivan Scenario by 2017
Electric Vehicle Market: Sales Forecasts Scenario Analysis (World), 2009-2017
Scenario's 2009 2010 2011 2012 2013 2014 2015 2016 20172020
(% of Total Car Sales)
Optimistic
Scenario4,500 23,100 123,800 289,500 665,000 1060,400 1,714,500 2,220,300 3,202,000 10-12%
F&S Scenario 4,500 16,500 72,000 193,000 453,000 792,000 1,287,500 1,736,000 2,203,000 5-7%
Conservative
Scenario4,500 13,500 35,600 82,500 150,300 195,100 300,500 450,000 670,000 3-4%
Note: All figures are rounded; the base year is 2009. Source: Frost & Sullivan
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64%
22%
10%
69%
22%
1%
2%
49%
35%
3%2%
2.2 Million
60%
28%
3%1%
2009 2017
4,500
7%7%
83%
2%
63%
20%11%
1%
• Japan and China are the key markets for APAC=> likely 80% market share. China expects major share from the local OEMs and potential for strong growth in India.
• eREV and PHEVs likely to account major share in the North American market driven by the virtue of demographics and customer driving characteristics => GM & Chrysler OEMs for eREVs. On the other hand, CEVs suit the demographics for the Europe.
EV Breakdown By Region - CEVs to Account for 69% Share In Europe; NA to Witness More PHEVs with a 35% Share
4%
6%
11%
8%
EV Breakdown By Region – Sales Estimates (World), 2017
Note: All figures are rounded; the base year is 2009 Source: Frost & SullivanNote: All figures are rounded; the base year is 2009 Source: Frost & Sullivan
5%
Un
it S
hip
men
ts
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Value is Driven by the Cathode and Separators but Binders and Laminate Resins are a Less Technical Way to Enter the Market
LaminatesThey hold the contents of the cell together. They consist of aluminum coated with PET resins to impart chemical
resistance. Corrosive chemicals are the biggest challenge to
construction
SeparatorsThey form a critical structural element, which is constructed of polymer films or ceramics. They act as a reservoir for
electrode active materials and separate the cathode from the
anode.•PP based seperaters are the most commonly used EV battery material.•Multilayers sperators are also gaining ground.•Newer technologies are emerging such as Aramid based technology and PVDF which offers high temerature stability
Anode Active MaterialIt plays a major role in
energy generation and is dominated by carbon-based
technologies.
Cathode Active Material Technology developments in a battery are mainly related to this material, and it accounts for a major share of the total
cost of the system.
BindersThese are typically high-
temperature polymers such as PVDF, which are used
to make a slurry of electrode active materials before being coated on to
current collectors.
ElectrolytesElectrolyte systems act as a
carrier of ions between electrodes.
Electrolytes are typically Lithium salts such as Li PF6
dissolved in EC or DEC solvents
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Technology Improvements and Grants Drive the MarketHigh Costs and Performance Restrain the Market
Improvements demanded in battery performance in terms of energy, power density and charging frequency
Note: Length of the arrows indicate the degree of impact of the factor. Source: Frost & Sullivan
Government initiatives to accelerate R&D and market growth
Environmental sustainability being the key trend in the transportation industry
Need to reduce the dependency on oil driving investment in alternative propulsion technologies
Introduction of novel technologies and entry of new suppliers in the growing Europe and US markets
High cost
Need to prove and test the safety aspects of emerging battery technologies
Battery technology
Total EV Batteries Market: Market Drivers and Restraints (World), 2010-2016
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Company TechnologyLocation
Ele
ctro
lyte
DOE Grant($ Million)
• Elyria, Ohio • 24.6 • Production of nickel-cobalt-metal cathode materials for Li-ion batteries
An
od
e
Sep
arat
ors
US DOE’s Grants for Lithium-ion Battery and Component ManufacturersDOE Grants are Excellent Sources of Plant Capital
• BASF Catalysts LLC
• Albany, Orlando• Production of high-energy density
nano-carbons• EnerG2, Inc. • 21.0
• Goose Creek, South Carolina
• Toda America • 35.0• Production of nickel-cobalt-metal
cathode materials for Li-ion batteries
• Silver Peak, Nevada• Chemetall Foote Corp. • 28.4• Production of lithium carbonate
and lithium hydroxide
• Sanborn, New York• Pyrotek, Inc • 11.3• Production of lithium carbonate
and lithium hydroxide
• Buffalo, New York • 27.3 • Production of LiPF6 salt for Li-ion batteries
• Honeywell International
• Zachary, Los Angeles • 20.6 • Electrolyte production• Novolyte Technologies
• Charlotte, North Carolina
• Celgard, LLC • 49.2• Production of polymer separators
for Li-ion batteries
Cat
ho
de
Ele
ctro
de
Act
ive
Mat
eria
ls
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• Development of manufacturing infrastructure across the industry
• Building relationships with suppliers
• Building relationships with end users
• Managing the trade-off between safety, performance and economics
• Developing a global presence
• Increasing battery life to match vehicle life
Infrasturucture and Value Chain Still to Fully Develop
EV Battery
Chemicals and
Materials
Key Industry Challenges
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Geographic Analysis of the Total Market
•Currently, Asia is the key region driving the demand for chemicals and materials in EV batteries, accounting for more than 80 per cent of the existing global demand.
• Within Asia, the major technology hubs are in Japan and South Korea, though China is emerging as a strong manufacturing location as well.
•Most of the leading market participants in the individual component segments such as separators, electrolytes and electrode active materials are based in Japan.•This is largely because of the intense outsourcing of battery production which happened in the beginning of this millennium, following the shifting of electronics manufacturing base to countries with low production costs.•Even in the batteries market, some of the leading participants such as A123 have their manufacturing facilities in China and South Korea.
Major Locations of Chemical and
Material Suppliers to the EV
Batteries Market in Asia
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•The United States and Europe will emerge as the significant markets for EV battery chemicals, due to government initiatives to promote many companies to set up production facilities in these regions.•Europe is also witnessing rapid development, which is signified by Nissan’s announcement to develop its electric cars in the United Kingdom. •Restrictions on air shipment of certain chemicals such as electrolytes, due to their inflammability, demand local production of such chemicals.
• These production facilities will, therefore, be set up in locations such as the United States and Europe where there is a huge end-user base.?
•GM and Chrysler are in the advanced stages of their EV rollout in the United States. Companies such as Daimler, PSA and BMW have major bases in Europe. These developments will foster the growth of the whole supply chain in these regions.
Geographic Analysis of the Total Market (Contd…)
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0
500
1000
1500
2000
2500
3000
3500
4000
4500
5000
5500
6000
6500
2008 2009 2010 2011 2012 2013 2014 2015 2016
0
50
100
150
200
250
300
350
400
450
500
High Growth Market but from a Small Base
YearRevenues ($ Million)
Revenue Growth Rate (%)
2008 12.1 -
2009 22.3 85.0
2010 104.1 367.0
2011 262.2 152.0
2012 1,030.1 293.0
2013 1,891.4 84.0
2014 2,995.8 58.0
2015 4,515.8 51.0
2016 6,450.3 43.0
Note: All figures are rounded; the base year is 2009. Source: Frost & Sullivan
CAGR (2009-2016): 125.0%
Re
ve
nu
e G
row
th R
ate
(%
)
Re
ve
nu
es
($
M
illi
on
)
Revenues ($ million)
Revenue Growth Rate (%)
EV LIB Market: Revenue Forecasts (World), 2008-2016
YearYear
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Distinct Functions in Value Chain but Lots of Vertical Integration
OEMsGM
and Ford
Battery Pack Integrators
Johnson Controls and NEC
Battery Cell ProducersA123, LG Chem, Saft and Toshiba
Chemical and Material SuppliersCelgard, Tonen Chemicals, Merck, Dow Europe and BASF
Raw MaterialsLithium Metal and Polymers Chemetall, FMC Lithium and
Arkema
Processed InputsLithium Salts and Solvents
Honeywell, Stella Chemifa, Kanto Denka Kogyo and Morita
Chemicals and MaterialsElectrolytes, Electrode Active
Materials, Separators and Collectors
Source: Frost & Sullivan
Total EV Batteries Market: Value Chain (World), 2009
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Value Chain Analysis:Hitachi presents an excellent case study of a highly integrated participant in the EV lithium-ion battery anode materials market.
Battery Systems
Module and Control Systems
Battery Pack and Cell
High-performance Materials
Processing Equipment
•Coating and dispersion technologies for the high-speed production of electrodes were developed by Hitachi Maxell. Other divisions such as Hitachi Plant Technologies also have a role in process design.
•It is the market leader in carbon anode materials. It also has capabilities of supplying high-purity copper foil to electrodes. •The active material is supplied as a powder to cell manufacturers that, in turn, mix it with the binder and coat it on to the electrode metal foil.
Started Battery production through subsidiaries such as Hitachi Vehicle Energy (HVE). HVE was established in 2004 to develop lithium-ion batteries for use in HEVs. The company has already sold 600,000 batteries in this market. Apart from battery systems, it also offers inverters and motors for HEV applications.
Source: Frost & Sullivan
EV LIB Anode Materials Market: Value Chain Analysis (World), 2008-2016
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Lithium Ion is Ideal Due to High Power Density
•The choice of battery material involves a trade-off between power, energy and safety.•The type of battery used and battery chemistry are different in EVs, HEVs and PHEVs.•In HEVs, the presence of ICE means that the range of the vehicle is not as important as its power.
• This creates opportunities for batteries with lower energy densities such as nickel metal hydride (NiMH).
•However, in EVs, battery capacity is a very critical factor for the vehicle to cover longer distances between recharges.
• This requires much high performance from the batteries, thereby creating opportunities for Li-ion battery technologies.
• Li-ion batteries are also expected to substitute NiMH batteries in HEVs largely in the long term of the forecast period. Source: mpoweruk
Energy Densities of Major Battery Chemicals
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Technology Trends:Different chemistries are competing for adoption in the EV lithium-ion battery cathode materials market.
Source: Frost & Sullivan
EV LIB Cathode Materials Market: Technology Trends (World), 2009
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Power & Energy Density are the Holy Grail
Source: Batteryuniversity.com
Attributes that Deliver Market Value
• Increase Power Density• Increase Energy Density• Longer Battery Life• Shorter Charge Time• Lighter Weight• Lower Manufacturing Cost
Methanol fuel cells can potentially be refilled faster than charging a battery. Supercapacitors have charge stored as electrical energy already available to be dissipated on demand – high power density
Energy Density
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Laminates for Outer Covering of Lithium-ion Batteries
•Although the laminates that are used to bind the contents of the cell appear to be a simple ‘coffee bag’ type of packaging, they are one of the critical structural elements in a lithium-ion battery.
•Currently, only two companies supply these globally on a commercial basis.
•Dai Nippon Printing is the leader with a market share of 70 per cent.
•The rest of the market is accounted for by Showa Denko.
•One of the main technical challenges for laminates is to withstand the highly corrosive electrode materials and electrolyte, which can quickly degrade them.
•Other critical physical properties include gas barrier, heat resistance and workability.
•Dai Nippon Printing has patented its process for laminate production, which involves the usage of a soft aluminium foil as the gas barrier and has an inner resin coating layer to provide the laminate with the necessary chemical resistance.
•Major companies in the aluminium packaging industry are targeting this lucrative market, and they are expected to enter into it in the medium-to-long term of the forecast period. Source: Showa Denko
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Binders for Electrode Materials
•Binder resins are used in electrode construction in lithium-ion batteries.
•These are used to make a slurry of the electrode active materials, which is then coated on to current collectors.
•Some of the key requirements for chemicals to act as binders include the following:
•High purity levels
•Thermal resistance
•Resistance to solvents in electrolytes
•Excellent adhesion of electrode active materials and collectors
•Processability
•Polyvinylidene fluoride (PVDF) is one of the most commonly used binders in EV batteries.
•Leading participants in this market include Kureha of Japan and Arkema.
•PVDF suppliers are also planning to develop separators out of their films.
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Separator Materials for EV Lithium-ion BatteriesMarket Overview
What Makes a Good Separator?•Separate the anode and cathode, sustain ionic conduction and act as a reservoir for the electrolyte.•Low acid solubility, good oxidation resistance and low electrical resistance.•High porosity and low thickness of the separator enable better permeability of lithium ions and, thereby, generate more energy.•Good mechanical strength to prevent run-aways
Source: Evonik
Ceramic Separion Separators
Battery Separators
Ceramic Polymer
PP
PP/PE/PP Trilayer
PE
PVDF (In Development)
Celgard &UBE
Evonik
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Market Growth Immense market growth is expected for all the components of EV batteries. The lithium-ion technology will largely supersede NiMH-based technologies
in HEVs and EVs over the long term of the forecast period.
Technology Trends
Geographical Trends
Growth Strategies
Acquisitions and joint ventures with technology companies and close relationships with key end users will have a major influence on ensuring market share and growth.
Vertical integration in the value chain will generate higher profit margins and control over technology.
Leveraging government grants and incentives are the key to reduce the capital expenditure burden in the start-up phase for market participants.
Findings and
Conclusions
Key Challenges
Rapid ramping up of components production capacities to meet the very high forecast growth rates in EV and battery production will be the significant challenge
The market will face high levels of price pressure from downstream companies, and increasing competition from low-cost production locations will augment the profit margin reduction for chemical suppliers.
Leading participants are mostly based in Japan; however, more US and European companies will emerge over the forecast period.
Nevertheless, South Korea, Japan and China will continue to have a major impact on technology and manufacturing in the market.
Investing in the appropriate technology will also be a major challenge for market participants. This is because the market is currently in nascent stage and is supporting a wide range of chemistries and technologies, but this support will narrow down as the market matures.
Key Findings and Conclusions:EV Battery Chemicals and Materials Market
Source: Frost & Sullivan
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How We Help Our Clients
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Typical Client Questions
• How do I capitalise on this key growth market?• In such a fast paced market do I understand who the winners and
losers will be?• Who should I partner with or target to develop products?• How do I cross sell products into other power storage sectors?• Where should I focus my R&D for the best returns?• What will be the next battery technology chemistry?• Will there be new market players and customers?• What will the business model look like?
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EV Battery Materials – Opportunity Analysis
• Client: • Leading Global additive and materials company, not currently active in the
electric vehicle battery materials market.• Scope:• Identify and confirm areas of the EV batteries market in which there are
unmet needs• Evaluate which products in the clients portfolio may be able to add value to
existing battery manufacturers• Quantify the market value of developing a product to address each specific
unmet need• Discuss and shortlist key market players and thus potential routes to market
for any future product developed• Methodology:• Strategic workshop format. Frost & Sullivan presented the roadmap and
development of the electric vehicle market and then, more specifically, the demand for chemicals and materials in the batteries. Growth opportunities specific to the client were then discussed and evaluated using inputs from Frost & Sullivan research and the clients in house data.
• Result: • Identification of multiple growth opportunities• Clear understanding of the size of each opportunity• Understanding of the market value of each opportunity and thus the price
that could be achieved if a product was developed to address a need• Understanding of likely revenue and profitability• Confirmation that an R&D campaign is worth investing in
Battery Systems
Module and Control Systems
Battery Pack and Cell
High-performance Materials
Processing Equipment & Chemicals
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EV Battery Components – Strategic Sourcing
• Client: • Leading Japanese automotive vehicle manufacturer with ambitions to supply
its EU electric vehicle plant with batteries produced in house from its own facility in the EU. The client wanted EU suppliers for the battery plant.
• Scope:• Identify existing suppliers of battery components in the following key areas:
• Cathodes• Anodes• Separators• Laminates• Electrolytes• Collectors
• Understand which new market players will be entering the market, the timeframe of commercialisation and likely supply capacity.
• Understand which companies can supply to the tight specifications laid out by the client.
• Research:• Interviews with battery component suppliers, battery assembly companies
and chemical companies identified as potential new market entrants.• Result: • Clear understanding of the EU supply potential for the battery plant• Understanding of potential new suppliers and new products being developed• Understanding of potential bargaining power in the purchase process• Company profiles of key players to further understanding of potential
partnerships and strategic fit
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Green fuels and lubricants
Electric vehicles and batteries
Recycling / end of life
Light weighting
Emerging Markets
Chemicals and Materials in Transportation Platform2011 Key Themes
Green Fuels and Lubricants
Electric Vehicles and Batteries
Recycling / End of Life
Light Weighting
Emerging Markets