If the clue in a word-association game is, “Highly respected expert in the advanced automotive battery market,” the correct reply is “Menahem Anderman.” Since 2000, Dr. Anderman has hosted the annual Advanced Automotive Battery Conference, the premier industry gathering for engineers, product planners, technologists, electric-infrastructure officials, researchers, and regulatory experts involved with vehicle electrification.
The AABC event, which Dr. Anderman founded as an adjunct to his Total Battery Consulting business, has grown steadily. In 2005 he added a full slate of technical symposia prior to the main event, as well as sessions on ultracapacitors. In 2009 the AABC drew 850 attendees from 28 countries and more than 400 companies. Demand in Europe inspired Anderman to put together the first European AABC, scheduled for February 2-5, 2010 in Mainz, Germany.
A chemical engineer, Dr. Anderman held executive positions in the battery industry, including Polystor and W.R. Grace. He earned his undergraduate degree at Hebrew University in his native Israel, and his PhD at the University of California.
When planning the AABC events, he makes a point of inviting hardnosed, opinionated speakers and presenters who, like himself, aren’t afraid to challenge preconceived notions about hybrid, EV, and battery developments and trends. It’s not uncommon for the Q&A to get quite lively and the subsequent discussions heated—as also happens when he presents at SAE International’s annual Hybrid Vehicle Symposium where he’s been a regular speaker and panelist.
Standardization slow to come
One of Dr. Anderman’s major observations recently is how there will likely be a proliferation of various lithium-based battery chemistries. He believes the technology is unlikely to settle any time soon.
“There will be 10 or 11 hybrid vehicles with lithium batteries in the 2011 time frame—and they will use five different technologies within that lithium,” he noted. “Standardization [of battery chemistries] will maybe take more than 10 years. Reduction in the number of approaches will probably happen slowly.”
What’s happening, he said, is the auto industry is developing “six or seven different vehicle architectures” that all require different battery sizes, power levels, and voltages. And within that technical diversity there will still be variations in chemistries, and in some cases, mechanical design.
Thus, for the strong-hybrid lithium to replace nickel-metal hydride (NiMH) in high volume and cost, Anderman believes vehicle makers will have to converge on one or two designs.
“Ideally the industry will pick one design in the next three to four years for ‘strong’ hybrids in high volume, and we’ll begin to get the cost down,” he asserted. He acknowledges that a technology convergence is extremely challenging, given the super-competitive nature of the industry.
The current situation presents numerous challenges to incumbent automotive suppliers and to emerging battery vendors, he warns.
“There has been a major shift in the last three years—the car companies have realized that most of the cell companies are not really structured to also be the pack manufacturer, supplying the packs just-in-time to the vehicle assembly line,” he noted.
More recently, the automakers have realized the value of making the packs themselves, because they want to build the knowledge.
Citing an example of this trend, Anderman reported that for an upcoming German car, the lithium battery pack initially will be made by a supplier. But beyond that the car company is looking at making the pack themselves. And in this trend are openings for pack integrators—the classical Tier 1.
“They may not be in this area long term; it’s hard to say. At the moment, most car companies have more experience with batteries than the Tier 1s,” Anderman noted.
The lithium cost challenge
Anderman talks about the role of production scale in reducing the cost of advanced automotive batteries.
“One of the things the industry can do is proliferate conventional NiMH hybrids to bring increased scale and bring cost down—with NiMH we are fairly close,” he said. “TPE (Toyota Panasonic Energy) is replicating their NiMH plants, making two plants. Expanding to a second plant means your engineering cost is low. The cost reduction of NiMH right now is not quite commodity, but it’s becoming close to that.”
He said scale in lithium-cell production will take its cost down. He reckons that at one million units per year for HEVs and 100,000 for PHEVs and EVs, “there will be a normal learning curve and there will be cost reductions due to normal economies of scale. Helping this trend is the development of new lithium materials, with lower manufacturing costs.”
While the current lithium-ion battery market represents an $8 billion business, opportunity for cost reduction on the existing material widely used in consumer electronics, is pretty close to zero, Anderman said.
“It’s very, very high-volume already,” he said. “I was talking to one materials supplier whose current business is focused on the cell phone market. His company charges $18/kg for their basic product, $20/kg for their moderate spec product, and $24/kg for the highest-high spec product. He told me Automotive is a much tougher specification than mobile phones or any other market they’re in.”
So what is the business case to charge less for Automotive than they do for cell phones, which is a much lower standard, Anderman asserted. In the end, everybody’s got to make a business case for lithium.
“The basic chemistry is already in high-volume production. The cost of the basic material will not come down quickly,” he said. “It will come down when they develop new materials which they are working on. You will get some faster cost reduction on the can and the tooling for PHEVs and EVs.”
To emphasize the point, he also noted that the companies who have a lead in lithium and have set up pilot plants for early production of automotive cells, also have had to increase their capital costs for added tooling and processes for things such as reducing moisture, removing particles, and tightening up tolerances.
“It all means added cost,” Anderman said.
At this year’s battery conferences, discussions regarding battery-swapping schemes as championed by Project Better Place have arisen. Anderman is very clear on where he stands on this controversial issue.
“We have 15 major car companies worldwide, and only one of them, Renault-Nissan, has come out publicly for this idea,” he noted. “Nobody else in the industry thinks it’s going to work. Even some of the Nissan guys say it’s not going to work!
“The biggest barrier to EVs and the most expensive aspect of EVs is the battery,” Anderman continued. “The battery-swap concept takes the most expensive cost aspect of EVs and makes it even more expensive.
“Logistics and infrastructure [for swapping] are very complex, and connectors are always a factor in electrical reliability. I’m not very optimistic about it,” he said.