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U.S.-Built Electric Cars To Get U.S.-Made Battery Cells Too

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January 15, 2013 - Detroit, MI. 2014 Cadillac ELR revealed at the 2013 Detroit Auto Show. Photo by Joe Nuxoll.

January 15, 2013 - Detroit, MI. 2014 Cadillac ELR revealed at the 2013 Detroit Auto Show. Photo by Joe Nuxoll.

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While the number of plug-in electric cars built in the U.S. is steadily increasing, the lithium-ion cells in their batteries have mostly come from overseas.

But this turns out to be the year that cell production largely moves onshore as well.

The 2013 Nissan Leaf, now coming off the assembly line in Smyrna, Tennessee, is powered by lithium-ion cells made in an adjacent fabrication plant that started production last fall.

Now comes a report that Korean cell maker LG Chem will start producing cells at its Holland, Michigan, plant in the second half of this year.

Those cells will likely be used in batteries for the Chevrolet Volt and the upcoming 2014 Cadillac ELR, both built at GM's Detroit-Hamtramck plant, as well as the low-volume Ford Focus Electric, also built in Michigan.

The Volt was the best-selling plug-in electric car in 2012, with a total of 23,461 units delivered in the U.S. plus another 6,629 in other markets. U.S. Volt sales are expected to be higher this year.

LG Chem executives confirmed in a Reuters article that the company would begin pilot production of lithium-ion cells in the Michigan plant in July or August.

The $300 million plant has enough capacity to fabricate cells for up to 60,000 electric-car battery packs a year, but slow sales of the Volt in 2011 had led LG Chem to continue supplying cells from an existing production line in South Korea.

Volt Battery Pack

Volt Battery Pack

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The lack of production at the Michigan LG Chem plant came under fire from Senator Claire McCaskill [D-MO] and other politicians.

LG Chem received a Recovery Act grant of $150 million for the plant, of which it has spent $143 million, but the plant has not yet fabricated any cells that have gone into production vehicles.

News reports last fall of workers being paid to sit around, play cards, and do community service work did not sit well with politicians after a DoE audit confirmed the workers were idle.

The plant opened in 2010, but workers were furloughed last fall because the plant could not economically be opened until electric-car sales volumes increased from their 2011 and 2012 levels.

Nissan lithium-ion battery pack plant under construction, Smyrna, Tennessee, Jan 2011

Nissan lithium-ion battery pack plant under construction, Smyrna, Tennessee, Jan 2011

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The 2014 Chevrolet Spark EV, a low-volume compliance car, will use lithium-ion cells from a different maker, A123 Systems, made in its Livonia, Michigan, plant. 

GM recently confirmed that A123's bankruptcy and acquisition by a Chinese company will have no effect on the Spark EV's launch schedule; it will go on sale in California and Oregon this summer.

The Tesla Model S, the third domestically built electric car now selling in volume, uses thousands of small "commodity" cells from Panasonic, which holds a minor stake in Tesla Motors [NSDQ:TSLA].

Those cells are fabricated in Asia, and thus far, Tesla has said nothing about bringing production of its battery cells to the United States.

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Comments (9)
  1. let's just hope car companies don't make their own cells as every battery they have made has been junk.

    Facts are the whole EV industry from battery to EV and their production l;ines were paid for by the gov in grants like this one. So why the h-ll do they cost so much? Drop the price and sales will boom. Put the real, full cost of oil in it's price and EV's will boom.

    refined Battery material, 22lbs, is well under $100/kwhr so unlikely they are paying more than $200kwhr for cells and another $100kwhr to package them into packs with electronics needed.
     
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  2. I agree! If government is paying for all those "initial investment", then why is it still so expensive. I think the automakers are still trying recover those investment in a really quick time frame b/c they don't believe in the project themselves for the long term. It seems that Nissan is "fully committed" and GM is about 60% way there. But the rest of the automakers are still on the fence or on the other side of the fence...
     
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  3. "Tesla has said nothing about bringing production of its battery cells to the United States". Of course it's not actually up to Tesla where *Panasonic* produces its cells. Tesla is just grateful it has in Panasonic a supplier that can build the right type of cell in the right sort of quantities for the sort of price that allows Tesla to meet profitability targets.
     
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  4. Tesla has many companies to chose from and Panasonic which is actually Sanyo are not the only makers of high quality small cells by any means.

    Likely Panasonic/Sanyo gave a really great deal to get his business. I'd be surprised if Tesla is paying over $175/kwhr for them, maybe as low as $150/kwhr.

    And they actually buy modules of them, 24vdc/100amphr IIRC, not cells.
     
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  5. It's not about the format, it's about the chemistry. Panasonic uses lithium nickel (LiNiO2) chemistry electrode material that's proprietary for Panasonic and makes them very suitable for automotive applications. Not sure how many other suppliers could have offered Tesla the optimal chemistry at a price level that would make Model S production profitable for Tesla but I'm guessing not too many.

    Your speculation about cell cost sounds about right and should make for an average $/KWh of less than $300 at the pack level.
     
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  6. Maybe the exact specification of the modules you are referring to is 25.2V/58Ah? Is more in line with the sort of math that goes with 3100MAh/3.7V 18650 cells.

    http://www.gizmag.com/panasonic-lithium-ion-battery-module/13030/

    It's new to me that Tesla should use these modules BTW, any sources?
     
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  7. I agree, I am delighted that Tesla is able to secure enough Li/ion cells from Panasonic that they can build a cost effective yet powerful battery pack with 85KW/Hrs of capacity. I would like to see some of these Li/ion cells come from an American company but as long as they are designing and producing the cars here in the USA I feel that they are doing a great job driving the market towards sustainable renewable energy for transportation. Elon Musk is an innovator and a visionary and when he makes up his mind to do something he makes sure it will happen.
     
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  8. I think LG has gotten a bad rap lately. There is no way that any manufacturing plant goes from the building stage to 100% production instantaneously. A rational person would expect there to be a transition period. The Volt sales are slow because GM has the price too high (the car are not too expensive, they are priced too high). LG built the plant, hired the people based on GMs projection and then didn't want to fire the people they trained because they knew the demand would come eventually. When LG Chem starts up there plant and eventually gets it running at full capacity will the haters return to say they were wrong. Probably not.
     
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  9. LG Chem confirmed that it will start fabricating production cells in its Michigan plant in July. The plant is already producing test cells.

    http://www.detroitnews.com/article/20130507/AUTO01/305070328/1148/AUTO01/LG-Chem-start-production
     
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