China is hiring Korean battery experts

CATL at The Battery Show Europe 2017

The imminent arrival of NCM 811 battery cells for EVs, which combine high energy density with low cost, finally convinced Chinese companies that the technology is ready for mass production.


EV batteries are about to experience the same revolution that solar panels had when Chinese companies started mass production and costs rapidly declined. You may not remember the old days when solar panels were really expensive. However, it was only when the Chinese Government decided it was time to make solar panels mainstream, that Chinese companies started mass production and prices dropped very fast. Now something unimaginable years ago is a reality, the cheapest electricity in the world is Mexican solar power at 0,015 euros per kWh.


With NCM 811 battery cells the kWh cost will drop to below 100 euros already next year. Volkswagen will be able to achieve 100 euros per kWh at the pack level by 2019 with the introduction of a dedicated platform for EVs (MEB). A simplified platform like MEB can improve heat dissipation and reduce the use of cables, making battery packs easier, faster and cheaper to assemble.


Battery costs roadmap by Volkswagen


When the Chinese companies start mass producing NCM 811 battery cells they’ll have the advantage of easier access to raw materials and I expect the kWh cost drop to 80 euros initially and coming close to 60 euros when the second generation (solid-state) arrives in 2020.

Right now CATL is actively trying to secure some battery supply deals with European automakers and is seen as a big threat by South Korean battery cell makers. Volkswagen and Renault are by far the main targets of CATL’s efforts, that’s why the company has offices in Germany and France.

Anyway, while I think that CATL will thrive in China, to get the European automakers it’ll have to produce the battery cells locally. Decentralization is the key strategy to succeed in a booming market and LG Chem was smart enough to localize production in four different countries (South Korea, China, USA and Poland).


Battery cell production targets by manufacturer


To sum up, the South Korean battery cell makers will make possible to build electric cars price-competitive with ICE (Internal Combustion Engine) cars very soon, but the Chinese are the ones that will achieve a much more impressive feat, make electric cars not only better overall, but also cheaper than their ICE counterparts.


What do you think? Will the South Korean battery cells makers survive the imminent arrival of the Chinese and their lower prices?



More info:

Pedro Lima

My interest in electric transportation is mostly political. I’m tired of coups and wars for oil. My expectation is that the adoption of electric transportation will be a factor for peace and democracy all over the world.

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3 years ago

Wow… 100 per kWh so soon… not good news for ICE companies slow to switch…
When will legacy auto pass those prices on to consumers in a volume product they want to sell…
If only the Chinese automakers would come to the EU and US with cheap BEV only cars instead of hybrids and ICE then they truly could quickly gain market share and force the legacies…

3 years ago

According to this article solid state batteries from Korean companies might not appear in cars till about 2025. Toyota despite some bold claims initially has some issues to resolve too.

3 years ago

Let’s hope that some of those batteries end here in Europe and that not all batteries are just for the Chinese marked. The Chinese are at least more serious about BEVs.

3 years ago

Apologies for sounding a bit negative again when it really is a positive piece if news. I am a big fan of EVs and really want to see their sales take off. On first glance when looking at the graph showing the growth in capacity of battery factories it seems that the growth is almost in ‘plaid’ mode. However, we need to bear in mind that while longer range is great for EV sales it is just part of the picture. Increasing factory capacity say 6 fold will not lead to EV sales growing 6 fold. That’s because till now most EVs were either Phevs or short range EVs with 30 kWh batteries. Moving to 50-60 kWh batteries will obviously require a lot more batteries than for the current crop so part of the gain “is eaten” by this improvement.
We also need to bear in mind that sales of ICE cars grow on average by 2 mln cars a year. We need to build a few Giga factories EVERY year just to keep up and a lot more to see ICE sales go down.

3 years ago

Combine €0,0015/ kWh electricty with € 60,-/ kWh batteries and you will have electricity day round for € 0,02/ kWh. Imagine coal costing around € 0,06/kWh to produce without the environmental impact.

Dmitry Pelegov
3 years ago

Battery makers ranging map is “crazy” – I can’t find the other words. Panasonic is still number 1. Authores of this map “forget” about the leader. Probably, CATL has came closer to BYD, but I doubt. CATL plans to build one or two plants in China due to its IPO news, but has “forgotten” about European plans. And even in China they only plan to finish new plant to 2020+, so 50 GWh is looking unreal even for CATL. And even for true leaders like Panasonic, LG Chem and BYD

Dmitry Pelegov
3 years ago

If electrification plans of major car makers will come true, we will face up with strong lack of batteries – why battery makers will decrease prices? And please don’t forget about needs of renewables and smart-grids. And the cost of raw materials is rather small part of battery cost. NMC 811 is supposed to be harder to produce (maybe I’m wrong) – so why it should be cheaper?
And solid-state battery is still far away from the EV market. It’s just the reason not to talk about something more real – for example about BEV sales