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Lux suggests how LG Chem might overtake EV battery leader Panasonic

18 August 2015

Panasonic is currently the runaway leader in the nascent battery market for electric vehicles, but LG Chem has the potential to overtake it in what will be a $30 billion market in 2020, according to a new report—“Watch the Throne: How LG Chem and Others Can Take Panasonic’s EV Battery Crown by 2020”—by Lux Research.

Panasonic’s 39% share of the battery market for plug-in vehicles makes it the leading supplier, but its reliance on a single deal with EV leader Tesla leaves it vulnerable, according to the consultancy. Panasonic lead rival LG Chem has already signed up large automakers including General Motors, Volkswagen, Daimler, and Ford. In the event of a surge in sales of plug-in hybrids (PHEVs) by the German manufacturers, LG Chem would only need to win over Japan’s Nissan to topple Panasonic.

However, in the likely case, Panasonic retains its leading position with 51% market share due primarily to Tesla sales.

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The battery world’s big three—Panasonic, LG Chem, and Samsung SDI—are engaged in an all-out war for market share in the emerging plug-in vehicle opportunity, yet their strategies differ wildly.

—Cosmin Laslau, Lux Research Senior Analyst and lead author

Lux Research analysts assessed opportunities in the battery market for electric vehicles in light of Panasonic’s dominant position. Among their findings:

  • Plug-in market is still in its infancy. Even Tesla, the “poster-child of the EV revolution”, holds less than a 0.1% share of global automotive sales. However, most auto majors are quickly offering more options: The Volkswagen Group, which sold 9.6 million units worldwide in 2014, plans 20 plug-in options by 2020.

  • Renault-Nissan Alliance is a wildcard. Renault-Nissan will account for 9% of this market in 2020. However, AESC, its joint venture that sources batteries from NEC, has underperformed, hobbled by high costs and lagging technology, leaving an opening for LG Chem (which already supplies Renault) to win over Nissan.

  • Next-generation technology is key to leadership. New technology beyond the current Li-ion batteries is key to the lower cost and higher performance need for future leadership. Already, Samsung Ventures has invested in solid-state battery developer Seeo and in graphene-silicon anode maker XG Sciences. Similarly, Volkswagen has backed Quantumscape and GM Ventures has invested in Sakti3, Envia Systems, and SolidEnergy Systems.

The report is part of the Lux Research Energy Storage Intelligence service.

August 18, 2015 in Batteries, Electric (Battery), Forecasts, Market Background | Permalink | Comments (5)

Comments

Tesla is 0.04% of global car 2014 sales (32.000/80.000.000).

Tesla is 10% of global plugin 2014 sales (32.000/300.000).

Tesla is 39% of global 2014 battery sales (1931Mwh/4934Mwh).

Tesla is the only automaker doing long-range BEVs and the only one that is demand constrained. The growth of plugins by Nissan, GM, Mitsubishi has stopped. Tesla keeps growing at 50% or more per year. I see a lot of new gasser plug-ins coming to market but they are not selling very well as they cost far more than ordinary gassers and they still pollute.

In my opinion Tesla will increase its market share of the plugin market and the battery market as no other automaker are building volume production for long-range BEVs (the only kind of plugin that is demand restricted). Therefore Tesla will continue to expand its market share until 2020 at least. I think Tesla will own 30% of the global market for plug-in in 2020 selling 500,000 cars spread on 60k Model S, 60k model x and 380k model 3.

Note also that the global market for auto batteries was 5GWh in 2014. Tesla is building a 50GWh factory! So by 2020 Tesla could probably own 67% of the global market for auto batteries with a total global auto battery market of say 75GWh.

Nissan is the disappointment in this market; they mismanaged their Leaf product badly after jumping the intersection on all the other companies. In retrospect, their decision to not improve range ongoing has let the others catch up and now they will be relegated to an "also ran." instead of the leader. It's a shame because the Leaf is a nice little short range car.

Sorry I wrote Tesla is demand constrained but I ment supply constrained of cause.

As an owner of a "plug-in gasser", my options to displace gas are constrained more by charging rate and opportunities than much else.  If there was a Supercharger for a Fusion Energi that could bring the battery to full charge in 20 minutes, and it was available most everywhere you wished to stop, I would burn much less gas.  As it is, even Level 2 charging is scarce outside of certain urban areas.

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