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AltairNano Closes Additional Order with Phoenix Motorcars; Enters into Exclusivity Agreement and Takes 16.6% Ownership

9 January 2007

Altair Nanotechnologies Inc. has received a $1-million purchase order for NanoSafe 35 kWh lithium-ion battery pack systems from California-based Phoenix Motorcars for delivery in February and March 2007. In addition, the company announced it has entered into a multi-year purchase and supply agreement with Phoenix under which Phoenix has projected orders for 2007 between $16 and $42 Million for up to five hundred battery pack systems.

Furthermore, in consideration for a three-year exclusivity agreement within the US, Altairnano received a 16.6% ownership in the company.

The three-year exclusivity agreement provides Phoenix with limited, exclusive use of Altairnano’s NanoSafe battery packs in four-wheel, all-electric vehicles having a gross weight up to 6,000 pounds. Altairnano’s NanoSafe battery packs manufactured for hybrid electric vehicles (HEVs) and plug-in electric vehicles (PHEVs) are excluded from the exclusivity agreement.

Depending on Phoenix’s level of demand, the entire projected order for NanoSafe battery pack systems may be shipped to Phoenix in calendar year 2007. Under the terms of the multi-year purchase and supply agreement, Phoenix will purchase all battery packs for its electric vehicles from Altairnano.

Phoenix must meet minimum battery pack purchases, annually, to maintain the limited exclusivity agreement. The minimum commitment to maintain exclusivity for 2007 would provide $16 Million in battery pack sales to Altairnano.

Altairnano’s NanoSafe 35 kWh battery pack systems enable Phoenix SUTs to meet California’s Air Resources Board Type III Zero Emission Vehicle (ZEV) standards while providing power for a driving range of 135 miles and driving speeds of up to 100 miles per hour. The NanoSafe battery pack can be recharged in less than 10 minutes at fast-charge stations.

Altair Nanotechnologies shipped ten of the 35 kWh battery packs to Phoenix on schedule at the end of December 2006. The shipment of the ten packs completed an initial $750,000 order placed by Phoenix in July 2006. (Earlier post.)

Phoenix Motorcars’ market strategy targets operators of fleet vehicles, such as public utilities, public transportation providers, and delivery services. This market presents a significant opportunity as there are more than 200,000 fleet vehicles in the State of California alone, with an increasing number of fleet operators now seeking freeway-capable, zero emission, all electric vehicles. The Phoenix SUT and SUV vehicles are the only all-electric vehicles currently on the market capable of meeting California’s Type III ZEV requirements.

The market opportunity for freeway-ready, all-electric, zero-emission vehicles is growing daily. Having a best-in-class company such as Altair Nanotechnologies as an equity owner and as a provider of safe, powerful, fast-charging battery packs, will be a major driver for our growth.

—Phoenix Motorcars CEO Daniel Elliott

(A hat-tip to Joe!)

January 9, 2007 in Batteries, Electric (Battery) | Permalink | Comments (36) | TrackBack (0)

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I hope Phoenix has some major funding behind it. I'd hate to see the Altair battery limited to a company that isn't able to use it to the max.

Alti needs to reduce cost. If a pack costs $75000, the market will be very limited.

I have developed some uneasy feelings towards Alti. They have yet to allow third party to independently verify the performance of their battery systems. The news releases by the company are not convincing short of third party verification.

"If a pack costs $75000"
It most likely does not, see the comments on the earlier post. The actual price ( not cost which is entirely different beast ) was claimed by someone to be $14 000 per battery pack.
The whole previous deal was $750 000 but what part of it was batteries and which parts were one-time R&D costs were not disclosed.

"Phoenix has projected orders for 2007 between $16 and $42 Million for up to five hundred battery pack systems."

$42 million / 500 = $84,000 each.

I don't want to be too much of a geek, but I get excited just reading this. Is this not the holy grail of transportation? A battery pack that can go 135 miles (or 250 with the larger one), up to 100 mph and recharge in 10 minutes, TEN minutes? That's fantastic! How can anyone possibly be excited about GM's new car with a big 40 mile range when we have these guys that can do 250? And then recharge in TEN minutes! It's just like having a gas vehicle. I'm actually surprized there isn't a lot more fan fare about this since it seems like these guys have broken down the technical barrier that we've been striving for for decades.

Because the technical barrier still stands except for those who can afford to spend >100K on a car.

If they had something a bigger company would buy (i.e. that could achieve mass market penetration), exclusivity would be as useful as a bullet in the foot.


Please don't form strong opinions about things you don't understand. The $750,000 payment was for the initial 10 battery packs and payment for the engineering and prototyping services provided by AltairNano to engineer the battery packs for the cars Phonix Motors chose to use for the electric SUT/SUVs.
It should be obvious to even the brain damaged that a $75,000 battery pack cannot be installed into a vehicle that sells for $45,000.

I can see why people are worried about the cost. If a 35 pack costs $10k- then we are golden, but $30k+ and we're seeing the breakthrough we all want yet.

There's only so much mass production can do. The Lithium and other materials cost money and we don't know yet if it can even be developed into a production line product.

Kent, aren't they only able to sell them for $45k because of the ZEV credits? I read somewhere that the true cost is much greater than $45k.

Both the SUT and the SUV will be sold for around $45K. They will make money off the credits in Cali.
The 10 minute recharge is if a super expensive charger is used (not expensive for fleet owners). Home charging is 6 to 8 hours.
I sat in the SUV at the Alt Car Expo in Santa Monica last month, it was nice. Depending on availability and financing I'm either getting this or the XS200 from Miles Automotive (to be unveiled this year). Perfect for my 60 mile max a day driving.

The numbers in this statement seem to contradict information that was supposedly from the horses mouth, stating that the batteries were around $14,000 each. 42,000,000 for 500 batteries doesn't look like $14,000 each to me. If this is the case, they are paying massive premium for exclusivity.

Lets see here

Altair has claimed to create an amazing technology significantly better than anything else on the market.

However, they don't seem to be making any sales attempts towards possible consumers (like GM,Ford), have not tried to use them in consumer electronics, have not provided any OEM development samples (like A123), nor submitted their battaries to independent verification.

They establish an exclusive agreement to sell them only to a company with questionable finances, which they now own a part of.

No rational mind would choose an exclusive agreement with no name Phoenix over possible orders for a major automaker.

This is starting to look like either incompetent management or investor fraud. Either way, I'm starting to smell BS.

Note that the exclusivity is limited to BEVs only. None of the major car manufacturers seem even remotely interested in producing BEVs. Even their PHEVs are at least a couple of years away and Altair can still go after that market.

The agreement would rule out Tesla. If you look at Altairnano's web pages you see that they are a nanotech company and not a battery company. Since they have limited manufacturing capability, each pack contains huge NRE costs that appear to make each pack cost much more than the actual price. I would agree that they should have GM and others look at the batteries and have independant lab tests done.

Could be BS or could be savvy IP protection. As noted earlier Altair announced a supplies agreement with Alcoa Alcoa is a giant mining and manufacturing op with deep pockets and a leg up on digging lithium out of the ground.

Ed Begley shot video driving the Phoenix around at a recent auto show and the thing worked. The video shows the NanoSafe batteries installed. Perhaps it's all hype - in which case the clanging of cell doors would ring loud for the highly exposed principles. Or it might just be smart to hang on to a technology that could be quickly 'disappeared' in the wrong hands.

It sounds like we can buy a BEV for 45k that has a battery pack that cost Phoenix somewhere between 32k and 75k.

Sounds like a pretty good deal for the consumer. You get an advanced battery pack and drivetrain with an SUV for free. It is half the price of a Telsa. What a deal.

It was said that Phoenix considers the ZEV credits from CA as part of the revenue stream to offset the loss on these early vehicles. That sounds reasonable to me.

Count me as someone that wants to buy this truck :)

Bulk buys of current li-ions for consumer can be had for $500 /kwh, in case of 35KwH pack its around $17500. By the descriptions Altair has changed only cathode materials in li-ion chemistry, and also supplies their KwHs in bigger packages than small li-ion cells of today. $14 000 for 35KwH in bulk sounds remotely plausible.
We will never know though, before something will be available for consumer.
BTW, A123 is 15-minute rechargeable too and widely available, as tested and confirmed extensively by RC hobbyists. Its just that they dont have larger cells suitable for automotive apps yet and 10-kwh range pack means complex battery management systems and putting together hundreds of cells.

Kert, so why is GM trying out A123 rather than Altair?

On an Interview with autobloggreen, a GM offical said they never even heard of Altair, which leds me to think that Altair never even bothered approaching GM.

GM is doing and claiming a lot of other things that plain dont make sense. Like, for instance, that the battery tech to do a 40-mile EV isnt there in 2007 and they have to wait a few years to see how things pan out.
This is BS at its finest. Refer to this post and comments:
http://www.autobloggreen.com/2007/01/09/whats-the-most-obvioius-question-to-ask-about-the-new-chevy-vol/1

I wouldn't get so hung up on present costs. Bottom line is that in mass production once R&D is paid the costs will be much more reasonable. The thing here is that they are actually able to do this with a battery. This is well beyond anything to date that I know of. It may take an expensive charger but that's no big deal for a fill station, maybe just a home where charging overnight is no big deal. The only time you need a fill station is when travelling cross country. It may all be BS but with this much publicity I really doubt it.

No problem for cross country if these batteries are in a series hybrid like the GM Volt. That 1L turbo genset comes on now and then at 70 mph highway cruising and gets 50 mpg. Sign me up!

I would like to make an interesting suggestion...

In a prior post regarding Altair Nano's batteries, the life expectancy was worked out:

"10,000 deep cycles were conducted... batteries retained 85% capacity..." or something like that was the press release. The estimated life expectancy range worked out to 1.5 million miles. In other words, more than most people would drive in their lives.

Perhaps one could finance these batteries over a VERY LONG period of time. Like 30 years. That's only $1k a year before interest, which is workable. Interest could be kept to a minimum seeing that the batteries would be the collateral which the bank could easily reclaim and sell.

One could move the batteries from one vehicle to next. To do this, however, some sort of standardized sizing would have to be conceived, such as ATX for computers. Good luck with that one...

John,

That is not a bad idea. If a major cost of getting BEVs or battery dominant PHEVs is the battery cost and they last a long time, then why not. It would be in the public interest to have these batteries available and used for this purpose. If it reduces oil consumption, air pollution and increases national security, lots of public good comes from that.

John,

If you factor in future V2G usage, the math works even better given the larger BEV batteries. I believe the next logical step after PHEV’s will be intelligent V2G usage.

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