With a planned production capacity of nearly 300 GWh, the layout of solid-state battery production has intensified, leading to a white-hot competition.
In the first month of 2024, before its midpoint, there have been frequent reports of breakthroughs in solid-state battery technology from overseas.
Japanese battery company Maxwell has developed cylindrical solid-state batteries (non-power) with a capacity of 200 milliampere-hours, 25 times the capacity of traditional square batteries. These batteries have been applied in Nikon industrial sensors, demonstrating excellent performance in heat resistance and cycle life. Samples are expected to be shipped as early as this month.
QuantumScape, a solid-state battery company in the United States, claims that its solid-state batteries have passed durability tests by the Volkswagen Group, achieving “charging cycles of over 1000 times with a capacity still above 95%.” This surpasses the industry standard of allowing a maximum capacity loss of 20% in 700 charging cycles. Following this announcement, QuantumScape’s stock price surged over 50%. This positive momentum also affected the A-share market’s solid-state battery sector, leading to consecutive gains and even some stocks hitting their daily limit. The capital market’s enthusiastic response has suddenly brought solid-state batteries, which have struggled with technical research and development for a long time, into the spotlight.
For solid-state batteries, high safety and high energy density are core competitive advantages, and durability, i.e., cycle life, is the shortcoming that needs improvement. As the development of solid-state battery research progresses, external expectations and requirements for their overall performance are increasing. Over the past year, some publicly disclosed solid-state batteries have demonstrated fast-charging capabilities of 4C and 6C, aligning more with the title of the “ultimate battery.”
Simultaneously, as a transitional solution and a window of opportunity for the development of full solid-state batteries, semi-solid-state batteries have entered a crucial stage of mass production. In 2024, there will be a further increase in production capacity and market demand. According to incomplete statistics, as of December 2023, the cumulative planned production capacity of semi-solid-state batteries in China has exceeded 298 GWh, with landed capacity approaching 15 GWh. During the same period, semi-solid-state battery shipments are expected to exceed the GWh level in 2024, possibly reaching the 5 GWh level.
A review of the development of (semi) solid-state batteries in 2023 reveals three distinct characteristics:
Firstly, various technical solutions are scattered, with research focused on solid-state electrolytes. In theory, in full solid-state batteries, solid-state electrolytes will completely replace liquid electrolytes and separators. Solid-state electrolytes are less flammable, heat-resistant, and have low chemical activity, significantly improving the safety of batteries.
If high safety is considered the “innate” feature of solid-state batteries, then their potential to surpass energy density limits is considered the core factor in being recognized as the “ultimate battery” among various new technological paths. Solid-state electrolytes have a wider voltage window (up to 5V or more), allowing compatibility with higher capacity positive and negative electrode materials, such as ultra-high nickel positive electrodes, lithium-rich manganese-based positive electrodes, silicon-based negative electrodes, and lithium metal negative electrodes.
According to research by High Tech Lithium Battery, in the past year, some publicly disclosed (semi) solid-state batteries have demonstrated fast-charging capabilities of 4C and 6C, approaching the performance of full solid-state batteries. However, the native disadvantage of solid-state batteries also comes from solid-state electrolytes. The solid-solid interface between solid-state electrolytes and positive and negative electrode materials can lead to high resistance and poor stability, further causing battery capacity decay and shortened cycle life.
Currently, the industry is addressing this challenge by improving the structure and composition of solid-state electrolytes, enhancing the stress/strain of positive and negative electrode materials, etc. For example, GAC Aion has designed a special composition for solid-state electrolytes, inducing the formation of an interface buffer layer on the negative electrode surface to reduce interface impedance and improve interface stability.
Due to different technological choices, overseas focus on sulfide solid-state electrolyte systems, while domestic focus on oxide systems, specific corresponding products have different strengths and weaknesses. Sulfide materials have a lower voltage window, directly affecting their compatibility with higher capacity positive and negative electrode materials, requiring modification and adjustment.
Oxide materials have the highest voltage window, are more compatible with high-voltage positive electrode materials, and their preparation does not have strict environmental requirements, making them economically strong and suitable for large-scale production and application. However, they are too rigid and brittle, making them less suitable for integration into full solid-state batteries.
Based on this analysis, future overseas solid-state battery products need to focus on breakthroughs in energy density, while domestic solid-state battery research and development need to catch up in the progress of sulfide or other solid-state electrolyte systems.
Secondly, the race is heating up, and semi-solid-state batteries are leading in mass production. Looking at the players entering the field, there are many startups entering the solid-state battery race, and the enthusiasm of automotive OEMs is increasing. They are investing internally in building their research teams and externally collaborating with battery manufacturers or startups, placing multiple bets.
However, at present, leading domestic battery companies such as CATL and BYD are relatively low-key in their solid-state battery layout, focusing on accumulating patents and not publicly disclosing products. Apart from CATL’s announcement that it will promote the application of its 500Wh/kg solid-state battery in the automotive field in 2024, there is no more concrete solid-state battery plan disclosed.
From the downstream demand perspective, currently, domestically, only a few models from NIO and Dongfeng Motor equipped with semi-solid-state batteries have been launched, and the number of vehicles equipped with such batteries needs to expand further. In 2024-2025, SAIC, GAC, and others are expected to announce their plans for semi-solid-state battery-equipped vehicle models.
GGII data shows that in the full year of 2023, the shipment volume of domestic semi-solid-state batteries has reached the GWh level. Among them, representing startup battery company Weilan New Energy, its solid-state battery shipment volume reached 0.8 GWh in 2023. In 2024, more than 5 new vehicle models equipped with (semi) solid-state batteries are expected to be launched in China, with a shipment volume expected to reach 5 GWh.
At the same time, the domestic planned production capacity of solid-state batteries has approached 300 GWh, with landed capacity of about 15 GWh in 2023.
However, the production capacity of solid-state electrolytes required for these batteries has not kept pace, with only three companies making relevant arrangements, and no capacity has been landed yet. The supply of solid-state electrolytes and other key materials is mainly carried out by the integrated capacity of solid-state battery companies and small-scale supply by suppliers of original positive and negative electrode materials.
Finally, the window of opportunity is urgent: cost reduction for semi-solid-state batteries, and the challenge for full solid-state batteries to be “all-around.” Comparing solid-state batteries with large cylindrical batteries, also considered representatives of “new batteries” in the last two years, it is found that although the planned production capacity of solid-state batteries is higher domestically, the uncertainty of their shipment volume is greater.
Both domestically and internationally, the planned production capacity for large cylindrical batteries is also at the 300 GWh level, with 150 GWh in China. In 2024, the shipment volume of large cylindrical batteries supplied to Tesla alone is expected to reach 30 GWh. In 2025, with the delivery of products from CATL and Eve Energy to BMW, the market space for large cylindrical batteries will further expand. The relatively certain demand from leading OEMs is a core driving factor for the large cylindrical battery market.
In contrast, in the field of solid-state batteries, in 2023, some semi-solid-state battery products were released and installed in vehicles. The concentrated orders for semi-solid-state batteries in the past two years were mainly from Chinese electric vehicle manufacturer NIO. Apart from the three models (NIO ET7, Dongfeng E70, and Lantu Chasing Light), the specific numbers for image demand have not been publicly disclosed.
It is easy to see that, with the progress of capacity landing still far from sufficient, there are signs of a mismatch between supply and demand for semi-solid-state batteries in China. The main reason is that the theoretical cost advantages of semi-solid-state batteries have not yet been demonstrated.
Whether adopting an oxide solid-state electrolyte system or retaining the use of traditional electrolytes, semi-solid-state batteries have high compatibility with existing production lines, with small production process challenges. Therefore, theoretically, they can enter the industrialization stage ahead of time.
However, different solid-state battery companies in China have different public statements about the cost of their semi-solid-state batteries. Qingtao Energy has stated that the cost of its semi-solid-state batteries to be installed in vehicles in the first half of 2024 is close to that of liquid lithium batteries. The cost of a single cell of Weilan semi-solid-state batteries already installed in NIO cars, as disclosed, is as high as 300,000 yuan.
There are multiple reasons for this phenomenon. Firstly, the development of the solid-state electrolyte industry chain for its core material is still in its early stages, with high processing costs. Qingtao Energy has a certain advantage in costs due to its integrated capacity.
Secondly, to achieve higher energy density, semi-solid-state batteries need to use higher capacity positive and negative electrode materials, which are more expensive.
Combining the data disclosed by Weilan New Energy and Qingtao Energy, it can be seen that positive and negative electrode materials and manufacturing costs together account for more than 70% of production costs. The cost reduction space for semi-solid-state batteries depends on the iteration of material technology and the improvement of manufacturing processes. However, from the investment and financing data, capital is still concentrated in multiple rounds of investment in solid-state battery companies, not yet penetrating into upstream supply chain areas such as new materials or production equipment processes.
Thirdly, the improvement in energy density for some semi-solid-state batteries is still limited, and the unit cost of battery packs has not been reduced. Looking at a single cell energy density of 300 Wh/kg, this can also be achieved by liquid batteries and large cylindrical batteries, which are more economically viable in mass production.
Fourthly, the scale production effect of semi-solid-state batteries has not yet manifested and awaits an increase in market penetration.
It is worth noting that, currently, the market is expecting an all-around player with comprehensive high energy density, high safety, and long battery life to emerge for solid-state batteries. This requires companies to plan more comprehensively.
For example, a recent policy document on vehicle-grid interaction issued domestically proposes the preliminary establishment of a technical standard system for vehicle-grid interaction by 2025 and the achievement of large-scale application of vehicle-grid interaction by 2030. This will impose higher requirements on the battery cycle life of new energy vehicles. In this context, battery durability will shift from being a shortcoming to be filled to a key direction for technical breakthroughs, posing new challenges for mass production.
Similarly, several solid-state battery products have integrated fast-charging capabilities, such as the ability of Tailing New Energy’s semi-solid-state battery to achieve an average 4C fast charge, and Toyota’s full solid-state battery product can “charge for 10 minutes and drive 1200 kilometers.” The market’s appetite for the “ultimate battery” continues to grow.
In summary, the urgent task for research and development teams is to reduce the cost of semi-solid-state batteries in the short term and simultaneously seize the technological high ground and mass production applications of full solid-state batteries in the medium and long term. This may form a mutually competitive force internally. Semi-solid-state batteries still need to wait for orders from strong vehicle models or OEMs to stabilize their position in the market and drive the technological development and industrialization progress of full solid-state batteries.