Battery Prices Are Falling Again as Raw Material Costs Drop

[silvrsvt]

https://www.bloomberg.com/news/articles/2023-11-26/battery-prices-are-falling-again-as-raw-material-costs-drop

 

As the auto industry grapples with how to make affordable EVs, the task may get easier by one key metric. Battery prices are resuming a long-term trend of decline, following an unprecedented increase last year.

 

According to BloombergNEF’s annual lithium-ion battery price survey, average pack prices fell to $139 per kilowatt hour this year, a 14% drop from $161/kWh in 2022.

 

This is the largest decline observed in our survey since 2018. However, the story behind this price decline is somewhat different than past years.

[GearheadGrrrl]

Probably due to reduced EV sales and production...

[rperez817]

2 hours ago, silvrsvt said:

However, the story behind this price decline is somewhat different than past years.

 

17 minutes ago, GearheadGrrrl said:

Probably due to reduced EV sales and production...

 

Here is the "story behind this price decline" that Bloomberg referenced but is missing from the quoted part in the OP. Expanded economies of scale for the entire value chain especially for raw materials used in cathodes, anodes, and electrolytes is the primary factor, though technological innovation is still important.

 

Quote

The main contributor to falling battery prices historically has been technological innovation. This hasn’t been the case in 2023. This year, the drop in battery prices is primarily attributed to lower raw material costs.

Prices of key battery metals — especially lithium — have fallen dramatically since January, due to significant growth in production capacity across all parts of the battery value chain, from raw materials and components to battery cells and packs.

Edited November 28, 2023 by rperez817

[GearheadGrrrl]

Simple supply and demand- We are trending to overcapacity which will drop prices a bit and could drop EV prices to the point EVs are almost competitive. But given the rising costs of everything else, most automakers are not about to make sustained drops in EV prices.

[rperez817]

33 minutes ago, GearheadGrrrl said:

But given the rising costs of everything else, most automakers are not about to make sustained drops in EV prices.

 

Hopefully the combination of technological innovation, intense competition, and economies of scale from production ramp ups that have already resulted in lower costs for BEV batteries will soon translate into "sustained drops in EV prices" due to the same factors being applicable to the vehicles themselves.

 

 

 

[jpd80]

1 hour ago, GearheadGrrrl said:

Probably due to reduced EV sales and production...

No, most of China’s lithium comes from Australia, there’s been gold rush prices paid over the past few years but has settled down now. A lot of that was as a result of rough period with trade relations that now seems to be on the mend…..

[silvrsvt]

15 minutes ago, jpd80 said:

No, most of China’s lithium comes from Australia, there’s been gold rush prices paid over the past few years but has settled down now. A lot of that was as a result of rough period with trade relations that now seems to be on the mend…..

 

The USA and Australia just signed a bilateral agreement that includes locking down minerals for US consumption 

 

https://www.whitehouse.gov/briefing-room/statements-releases/2023/10/25/fact-sheet-delivering-on-the-next-generation-of-innovation-and-partnership-with-australia/

 

Not to mention all the Defense stuff going on with you guys getting 3 Virginia class Attack Subs in the next 10 years too. 

[jpd80]

23 minutes ago, silvrsvt said:

 

The USA and Australia just signed a bilateral agreement that includes locking down minerals for US consumption 

 

https://www.whitehouse.gov/briefing-room/statements-releases/2023/10/25/fact-sheet-delivering-on-the-next-generation-of-innovation-and-partnership-with-australia/

 

Not to mention all the Defense stuff going on with you guys getting 3 Virginia class Attack Subs in the next 10 years too. 

Absolutely, the prework on security clearances and cooperation on quality control inspection and testing agreements is just beginning now. So much stuff going on at high levels, you guys are just on another level.

 

Im surprised that the lithium alliance took this long, to say that a few Chinese heads spun around would be an understatement, they thought they had us by the nuts but now everything has changed. Tesla is also looking at direct sourcing too so very interesting.

Our government research laboratory came up with an ingenious system that recovers a lot of lithium while avoiding the traditional kiln process.Makes hard rock mining way more efficient. Using Australian to source lithium neatly avoids many political and environmental concerns.

Edited November 28, 2023 by jpd80

[jpd80]

59 minutes ago, rperez817 said:

 

Hopefully the combination of technological innovation, intense competition, and economies of scale from production ramp ups that have already resulted in lower costs for BEV batteries will soon translate into "sustained drops in EV prices" due to the same factors being applicable to the vehicles themselves.

 

The next big push on costs has to be solid state lithium batteries with their higher power density.

 

If we get to the same capacity with a third of the lithium, a third of the cost and a third of the weight,

everything changes….

Edited November 28, 2023 by jpd80

[jpd80]

Don’t get me wrong, I’m not anti-BEV, I just don’t see the sense in scaling up BEV production before solid state batteries arrives.

[DeluxeStang]

4 hours ago, jpd80 said:

Don’t get me wrong, I’m not anti-BEV, I just don’t see the sense in scaling up BEV production before solid state batteries arrives.

Solid state seems like the long term play, but lithium ion, particularly trying to find ways to downsize and reduce the cost of those batteries seems like it'll be key if we want to make evs more affordable. 

 

Ford could have a multilayered approach of using lithium ion batteries on more affordable EVs long term, and using solid state on higher end EVs, where the higher price of those batteries can be more easily absorbed by the higher MSRP. 

[jpd80]

9 hours ago, DeluxeStang said:

Solid state seems like the long term play, but lithium ion, particularly trying to find ways to downsize and reduce the cost of those batteries seems like it'll be key if we want to make evs more affordable. 

 

Ford could have a multilayered approach of using lithium ion batteries on more affordable EVs long term, and using solid state on higher end EVs, where the higher price of those batteries can be more easily absorbed by the higher MSRP. 

Many here will attest to the feeling that solid state batteries are sold as just over the hill or in the next few years…

I don’t know if that’s just selling blue sky or whether battery companies are holding back to maximise Lion sales.

(Remembering how NiCad was selling well then nickel metal hydride followed quickly and killed it off in a few year)

 

Edited November 29, 2023 by jpd80

[silvrsvt]

3 hours ago, jpd80 said:

Many here will attest to the feeling that solid state batteries are sold as just over the hill or in the next few years…

I don’t know if that’s just selling blue sky or whether battery companies are holding back to maximise Lion sales.

(Remembering how NiCad was selling well then nickel metal hydride followed quickly and killed it off in a few year)

 

 

Solid State Batteries are still a ways off for mainstream use in cars. I have stock in Solid Power and its only like $2-3 a share. I think if it was ready for primetime it would be worth much more then that. 

 

the reason NiCad was replaced so quickly was the the NiMH batteries where far better then them. There are still other battery chemistries that need to be developed that I think will see the market before Solid State Batteries hit the market in any meaningful quantity. I just wonder what the timeline is to switch over would be once that happens. 

[ice-capades]

31 minutes ago, silvrsvt said:

 

Solid State Batteries are still a ways off for mainstream use in cars. I have stock in Solid Power and its only like $2-3 a share. I think if it was ready for primetime it would be worth much more then that. 

 

the reason NiCad was replaced so quickly was the the NiMH batteries where far better then them. There are still other battery chemistries that need to be developed that I think will see the market before Solid State Batteries hit the market in any meaningful quantity. I just wonder what the timeline is to switch over would be once that happens. 

 

I saw several articles not long ago mentioning that a "breakthrough" is possibly within reach for solid state battery production. For now, solid state battery production for the automotive industry isn't expected until at least 2028.  

[silvrsvt]

16 minutes ago, ice-capades said:

 

I saw several articles not long ago mentioning that a "breakthrough" is possibly within reach for solid state battery production. For now, solid state battery production for the automotive industry isn't expected until at least 2028.  

 

Yeah I'm thinking we won't see it become mainstream till after 2030. But I'm also thinking that other battery chemistries will come along that will offer improvements over what we have now before that. 

[Rick73]

19 hours ago, jpd80 said:

The next big push on costs has to be solid state lithium batteries with their higher power density.

 

If we get to the same capacity with a third of the lithium, a third of the cost and a third of the weight,

everything changes….

Higher cost is a major issue, but energy- and size-density advantages seem to be a certainty already, though maybe not 3X as high initially.  Most sources I’ve read estimate roughly half the volume per kWh and twice the energy per unit weight.  That’s still a game changer in many ways, though we don’t know full effect of such advances.  Some estimates speculate future capacity as high as 800 Wh/kg, but I have no idea if that’s realistic.

 

One issue I’ve wondered about is whether electric vehicles will remain based on skateboard design, or if that will change as batteries become much smaller and lighter.  At 3X or 4X energy density and size reduction in future it could change vehicle designs completely.  Obviously manufacturers could also add more battery capacity to extend range even more than provided by weight savings, but at higher cost per kWh initially for solid state batteries, it would make for an extremely expensive vehicle.  Whatever happens it will be interesting to see it develop.

 

[mackinaw]

3 hours ago, ice-capades said:

I saw several articles not long ago mentioning that a "breakthrough" is possibly within reach for solid state battery production. For now, solid state battery production for the automotive industry isn't expected until at least 2028.  

 

Toyota seems to be in the lead here, but apparently solid state batteries are not easy to mass produce.  This is from Automotive News.  Behind a paywall, but the headline and byline says it all:

 

https://www.autonews.com/mobility-report/toyota-solid-state-battery-mass-production-limited-even-2030

[jpd80]

Solid state battery tech is like getting a man on the moon to the automotive industry but then I started thinking of the wider consequence for all battery situations - it will be a massive change.

[Captainp4]

34 minutes ago, jpd80 said:

Solid state battery tech is like getting a man on the moon to the automotive industry but then I started thinking of the wider consequence for all battery situations - it will be a massive change.

I'm ready for some solid state powered lawn equipment, I have the baddest of the bad battery backpack blower - it's adequate for blowing off grass clippings on our normal lawn routes during the cutting season, but can't hold a candle to even entry level 2 stroke commercial ones. I'd love a light weight and powerful one for leaf cleanup season instead of carrying around this 80cc 2 stroke that is louder than my open header 16:1 compression 460 racetruck ?

[Rick73]

First applications should be where weight is most critical, so I expect most things that fly like drones and electric planes to use solid state batteries first.  Weight is important for EVs as well, but not nearly as critical as with vehicles fighting gravity directly.  Apparently some drones with solid state batteries are already in use.  Prototype batteries are reported to have made it to space station as well so technology is getting close.

 

Other than for EVs and powerful lawn equipment, I’d like to see some company build a powerful yet light cordless vacuum cleaner.