Japanese lithium-ion battery makers develop future strategies

Toyota increases production capacity to 200,000 vehicles

2013/10/31

Summary

6.7 kWh lithium-ion battery pack for Accord PHV
A 6.7kWh lithium-ion battery pack made by Blue Energy for Honda's Accord Plug-in Hybrid Vehicle

 Summarized below are the development, production and supply status of lithium-ion batteries for automotive use by Japanese battery manufacturers during the past one year. Nissan Motor Company Ltd. (Nissan) and Mitsubishi Motors Corporation (MMC) are leading electric vehicle (EV) manufacturers. Over half of demand for automotive lithium-ion battery in Japan is supplied by two battery manufacturers, Automotive Energy Supply Corporation and Lithium Energy Japan, in which Nissan and Mitsubishi have stakes respectively.

 Nickel metal hydride battery (Ni-MH battery) has been used by Toyota Motor Corporation (Toyota) and Honda Motor Company (Honda) on their hybrid vehicles (HV) . However, more HVs equipped with lithium-ion battery is expanding.


Related MarkLines reports:
* "Toyota aggressively adds all-new models to HV lineup" (posted in October 2013)
* "Honda introduces three types of HV; Mitsubishi shows EV-Derived PHV" (posted in October 2013)
* "The International Rechargeable Battery Expo 2013" (posted in March 2013)




Toyota,PEVE, and major lithium-ion battery manufacturers

 Many Japanese lithium-ion batttery manufacturers are increasing production.Toyota and Primearth EV Energy Co., Ltd. (PEVE) are increasing their annual production capacity by six times to an equivalent to 200,000 units of the Prius in 2015. Blue Energy Co., Ltd. (Blue Energy) that supplies lithium-ion batteries to Honda will increase its annual capacity from 4 million cells as of March 2013 to 25 million cells by March 2016.

 Panasonic Corporation is enjoying brisk sales of its batteries to Tesla Motors, Ford Company and other automobile manufacturers overseas. To meet the growing demand, Panasonic is increasing production capacities at three plants in Japan.

 According to GS Yuasa Corporation's medium-term business plan for the fiscal year ending March 2014 to 2016 (FY 2013 to FY 2015), regulations demanding higher fuel economy will be introduced in advanced countries. This will accelerate market penetration of eco-friendly vehicles that are powered by lithium-ion batteries. GS Yuasa is predicting a severe global competition among battery manufacturers in Japan and overseas. GS Yuasa and Bosch have agreed to jointly develop next-generation lithium-ion batteries. The two companies will strive to double the present EV cruising range by 2018, in order to win the ever growing competition.The use of electric double-layer capacitors that supplement the lead storage battery in regenerative braking systems is increasing as well.





Toyota/PEVE: Building annual production capacity of lithium-ion batteries for 200,000 vehicles

 Toyota/PEVE already have annual battery production capacity equivalent to 1.2 million hybrid vehicles. However, lithium-ion batteries account for only 36,000 vehicles of the total quantity. PEVE will increase its lithium-ion battery production capacity for 200,000 hybrid vehicles a year starting in 2015.

 Toyota announced joint production of Ni-MH batteries in China. The batteries will be used on Toyota's hybrid vehicles slated for integrated production in China starting in 2015.

 As part of a long-term strategic collaboration initiative, Toyota and BMW started joint research in March 2012 regarding next-generation lithium-ion battery technologies. Later in January 2013, the two companies announced the second phase of their collaboration calling for joint development of  lithium-air batteries, which is post lithium-ion batteries.

Toyota/PEVE: Increasing annual production capacity of lithium-ion batteries for 200,000 hybrid vehicles in 2015

 Toyota/PEVE are producing lithium-ion batteries at Toyota's Teiho plant for Toyota's seven-seater Prius α and Prius Plug-in Hybrid (PHV). The plant has annual capacity of 36,000 vehicles. A new facility will be added to PEVE's Omori plant in Kosai, Shizuoka Prefecture, to increase lithium-ion battery production capacity to 200,000 vehicles. Production will start in April 2015. The batteries will reportedly be used on the all-new Prius model.
 PEVE has capacity to produce Ni-MH batteries and lithium-ion batteries for 1.2 million vehicles a year. PEVE operated in full capacity in FY 2012 and will also operate in full scale until the end of FY 2013. The company had declared that a new line would be added at the Miyagi plant if a need arises for more Ni-MH batteries, or at the Omori plant if demands call for more lithium-ion batteries.

(Note) PEVE is 80.5% owned by Toyota and 19.5% by Panasonic.

Toyota: Joint venture production of Ni-MH batteries for HVs in China
 In May 2013, Toyota and a Chinese battery manufacturer, Hunan Corum New Energy Co., Ltd., announced the establishment of a joint venture company for producing Ni-MH batteries for automotive use. The new company is equally capitalized by the Japanese and Chinese companies.  The total investment will amount to JPY 15.6 billion. The batteries will be used on the hybrid vehicles to be produced locally by Toyota starting in 2015 at the earliest. Hunan Corum New Energy is the Chinese company that acquired Panasonic's automotive Ni-MH battery plant in Chigasaki, Kanagawa Prefecture, in 2011. The company thus has experience in producing Ni-MH batteries.
 The Chinese government demands foreign automakers engaged in local production of HVs or EVs in China to produce at least one of the following items, batteries, motors or control units jointly with a Chinese company.
 PEVE has begun sampling of positive and negative electrode materials and electrolytes from suppliers in China to evaluate local suppliers of materials and parts. If required performance is not met by local suppliers, PEVE will consider requesting Japanese suppliers to set up operations in China. The company plans to install an automated production line that will meet Japanese standards regarding safety and reliability.

 

 



Nissan: Producing lithium-ion batteries with longer warranty in the U.K. and the U.S.

 Automotive Energy Supply Corporation, established jointly by Nissan and NEC Corporation, is producing lithium-ion batteries for the Leaf EV and the Fuga/Cima/Infiniti Q50 HVs at the Zama plant in Japan. Additionally, Nissan started producing lithium-ion batteries in the U.K. and the U.S. at the end of 2012. Nissan is producing the Leaf in the two countries and aspires to accelerate the further market penetration of its EVs by producing batteries locally.

 One of the company's EV sales promotional initiatives is the new, extended battery warranty program. Its standard battery warranty for the Leaf includes five-year 60,000 mile coverage against battery capacity loss and eight year 100,000 miles coverage against defects. In addition, Nissan will offer a battery pack replacement program starting in 2014.

Nissan: Producing lithium-ion batteries in the U.K. and the U.S.

U.K.  Nissan began producing lithium-ion batteries at its Sunderland plant in the U.K. at the end of 2012. The plant has annual capacity to produce batteries for up to 60,000 units of the Leaf. The batteries from this plant are used on the Leaf being produced at the same plant since March 2013. The batteries will also be supplied to the Renault-Nissan Alliance to meet their demand in Europe.
U.S.  In December 2012, Nissan began producing lithium-ion batteries at the Smyrna plant in the U.S. The batteries are used on the Leaf being produced at the same plant since January 2013. The plant's production capacity for lithium-ion batteries can be increased to 200,000 units of the Leaf a year. The batteries can be used on EVs and HVs other than the Leaf.
 Nissan will invest USD 1.7 billion in total to increase production of the Leaf and batteries to maximum capacities. The company will receive up to USD 1.4 billion loan from the U.S. Department of Energy.
(Notes) 1. Renault-Nissan Alliance once planned to produce lithium-ion batteries in France and Portugal, in addition to Japan, the U.K. and the U.S., to build enough capacity for up to 500,000 units of the Leaf in the world. But the plan for France and Portugal has been shelved.
2. In 2013, Nissan began producing motors for the Leaf at the Decherd powertrain plant in the U.S.

 

Nissan: Extended warranty for lithium-ion batteries
U.S.  Nissan offers a standard battery warranty of 5 year or 60,000 mile coverage against battery capacity loss to 9 bars (below approximately 70%) or less out of 12 full bars. Nissan also offers a warranty of 8 year or 100,000 mile coverage against defects.
 Nissan announced plans in the U.S. to offer an additional battery pack replacement program starting in the first half of 2014 to customers willing to pay a monthly charge of USD 100. This also applies to the owners that purchased used Leaf vehicles that meet certain technical conditions (details about warranty conditions and offerings in other regions will be announced later).
 Lithium-ion battery technology is evolving constantly and the new warranty program will allow Leaf owners to upgrade to the latest available battery technology in the replaced battery. The new program was designed taking into consideration that the majority of EVs sold in Europe, including the Leaf, involve battery leasing sales separated from the vehicle sales.
Japan  In May 2013, Nissan introduced a warranty program that offers free battery repair or replacement of batteries whose capacity has fallen below 9 bars out of the original 12 bars within 5 years or 100,000km mileage.

(Note) Nissan is certain that "the lithium-ion batteries installed on the Leaf will maintain 80% of the original charge capacity after five years." Therefore, most of the Leaf owners will never need the replacement service but will gain the peace of mind with their EVs.

 

 



Hitachi Vehicle Energy: Batteries for Nissan's front-wheel drive HVs produced in the U.S.

 Hitachi Vehicle Energy, Ltd., completed a lithium-ion battery module production line in November 2012 at its parent company, Hitachi Automotive Systems' Harrodsburg plant in Kentucky, the U.S. The company is supplying third-generation lithium-ion batteries (with specific energy density of 3,000W/kg) for the Buick LaCrosse/Regal models equipped with GM's eAssist mild hybrid system since 2011, and also for the Chevrolet Malibu Eco since 2012.

 The company has developed fourth-generation lithium-ion batteries with specific energy density of 4500W/kg. The batteries  are reportedly supplied to the front-wheel drive Nissan Pathfinder HV and Infiniti QX60 HV produced at the Smyrna plant in the U.S. from 2013. The Smyrna plant has been producing lithium-ion batteries for the Leaf since the end of 2012. It is said that the company has decided to increase the number of suppliers to reduce costs and risks as well. Hitachi Vehicle Energy has also developed lithium-ion batteries for PHVs and EVs with the capacity and energy density increased to 30Ah and 130Wh/kg, respectively (compared to 4.8Ah and 72Wh/kg of the fourth-generation batteries mentioned above).

 

 



Lithium Energy Japan: Batteries for Mitsubishi i-MiEV and Outlander PHV

 Lithium Energy Japan was established in 2007 jointly by GS Yuasa (with a 51% stake), MMC and Mitsubishi Corporation. The company supplies lithium-ion batteries for MMC's i-MiEV, MINICAB MiEV and Outlander PHV.

 In the spring of 2013, Lithium Energy Japan constructed facilities at three plants in Japan (Kusatsu, Kyoto and Ritto) to produce batteries for an equivalent to approximately 150,000 units of the MMC's i-MiEV. However, the i-MiEV and the commercial vehicle, MINICAB MiEV, sold fewer than 5,000 units in Japan in 2012. Because of the low plant operating ratio, the company decided to consolidate battery production into the Ritto plant. The company is striving to win orders from automakers other than MMC in order to keep the Ritto plant in full-capacity operation.

 Production of the MMC's Outlander PHV was suspended from the end of March to mid-August 2013 due to a battery defect. Despite the interruption, the PHV is in high demand because of its excellent environmental performances. The lithium-ion battery production line is keeping busy after the resumption of operation.

Lithium Energy Japan: Reducing production capacities

 Since its establishment in 2007, Lithium Energy Japan invested over JPY 80 billion in cooperation with the Mitsubishi group. In the spring of 2013, the company constructed production capacity equivalent to approximately 150,000 units of the i-MiEV in total at the Kusatsu plant (6,800 units), the Kyoto plant (11,000 units) and the Ritto plant (125,000 units in phases 1 and 2 combined).
 However, shipment of batteries for the i-MiEV plunged in fiscal 2012 and Lithium Energy Japan decided to consolidate its production to the Ritto plant. The company booked impairment loss of JPY 2.7 billion in the fourth quarter of FY 2012 with regard to the production equipment at the Kyoto and Kusatsu plants.
 GS Yuasa will purchase the applicable assets and use them for producing lithium-ion batteries for hybrid train cars and other industrial use.

 

 



Blue Energy: New batteries for Accord HV/PHV

 Blue Energy was established in 2009 by GS Yuasa (51%) and Honda (49%) and began producing automotive lithium-ion batteries in February 2011. Batteries are supplied for the Honda Civic HV  and CR-Z. In addition, Blue Energy supplies new  lithium-ion batteries for three types of HVs and PHVs that were launched by Honda in 2013. The EH19, characterized by high capacity and equally high output, is used on the Accord PHV. The EH5, used on the Accord HV, is of the same size as the conventional batteries but has a substantially higher output performance as well as higher durability. Blue Energy also supplies lithium-ion batteries for the Honda Fit HV launched in September, and also for the Acura RLX fitted with a three-motor hybrid system and to be launched in the U.S. in 2013.

 Blue Energy plans to increase its battery production capacity from 4 million cells as of March 2013 to 25 million as of March 2016. This is in line with Honda's plan to increase models powered by lithium-ion batteries. The company plans to book single-year profitability in the fiscal year ending March 2014, and clean sweep the accumulated loss in the fiscal ending March 2016.

 All lithium-ion batteries used on Honda vehicles are supplied by Blue Energy other than Toshiba's SCiB on the Fit EV. According to Automotive News dated September 23, 2013, however, Honda is looking for a second supplier for its batteries. Honda hopes to introduce competition principles among suppliers and keep a backup supplier in case of supply interruption due to a quality issue or natural disaster. The new supplier will be decided within a year.

 

GS Yuasa's medium-term business plan: Aiming for consolidated net sales of JPY 60 billion in fiscal year ending March 2016

 GS Yuasa announced a three-year business plan including that of its consolidated subsidiaries, Lithium Energy Japan and Blue Energy. The company reported poor results in the lithium-ion battery segment for the fiscal year ended March 2013 with the sales volume of JPY 10.6 billion and operating loss of JPY 11.2 billion. This was due to the loss in sales of lithium-ion batteries for the i-MiEV and the cost depreciation of JPY 6 billion. The company nevertheless plans to increase its sales volume to JPY 60 billion and recover operating profit in the fiscal ending March 2016.

GS Yuasa's results and plans by segment

(in billions of yen)
Results Plans
Fiscal year ended March 2012 Fiscal year ended March 2013 Fiscal year ending March 2014 Fiscal year ending March 2015 Fiscal year ending March 2016
Lithium-ion
batteries
Sales 21.0 10.6 28.0 50.0 60.0
Operating profit (loss) (3.3) (11.2) (7.5) (1.0) 1.0
Domestic automotive batteries Sales 58.8 55.6 59.0 61.0 62.0
Operating profit 4.3 3.9 4.0 5.0 6.5
Consolidated
(incl. other segments)
Sales 285.4 274.5 350.0 400.0 450.0
Operating profit 16.0 9.8 16.0 28.0 36.0
Source: GS Yuasa's 3rd medium-term business plan (July 31, 2013)
(Notes) 1. The figure for lithium-ion batteries segment includes results of GS Yuasa's consolidated subsidiaries, Lithium Energy Japan and Blue Energy.
2. Lithium Energy Japan booked a depreciation cost of JPY 6 billion in FY 2012.
3. The domestic automotive batteries segment mainly refers to the lead storage battery business. GS Yuasa is already the top supplier in terms of volume of shipments of automotive batteries. The company aspires to expand sales of auxiliary batteries for HVs and batteries for vehicles equipped with a start/stop system. The company plans to sell 9 million batteries in FY 2015 and win a top market share of 40%.

 

 



GS Yuasa: Develops next-generation lithium-ion batteries jointly with Bosch

 In June 2013, GS Yuasa, Robert Bosch GmbH and Mitsubishi Corporation announced that they had agreed to cooperate in developing next-generation lithium-ion batteries. The three companies have set a goal to develop lithium-ion batteries that will double the per-charge cruising range available from the ongoing batteries. The new batteries will be commercialized by 2018 and lead the market after 2020 when stricter environmental control is introduced and EVs and PHVs will become more popular.

 Bosch has dissolved SB LiMotive, a joint-venture  formed with Samsung SDI. The company is seeking a new foothold prior to the likely introduction of stricter environmental control in major countries. In addition, it is said that Bosch is the best partner for GS Yuasa in expanding its lithium-ion battery business.

GS Yuasa and Bosch jointly developing next-generation lithium-ion batteries

 In June 2013, GS Yuasa, Robert Bosch GmbH and Mitsubishi Corporation announced that they had agreed to establish a joint-venture (50% owned by Bosch, 25% each by the two Japanese companies) for joint development of next-generation lithium-ion batteries. The three companies have set a goal to develop all-new lithium-ion batteries for EVs and PHVs. The batteries will have substantially high energy storage capacity that will double the per-charge driving range available from the ongoing batteries.
 The new joint-venture company will be headquartered in Stuttgart, Germany, and start operations at the beginning of 2014. The three companies will contribute their resources to make the joint venture a success. Bosch has expertise in battery pack management systems and their integration into vehicles. GS Yuasa has many years of experience in producing lithium-ion batteries while Mitsubishi Corporation has a worldwide marketing network and expertise in procurement of resources.
 The three companies reportedly will start discussing the integration of their respective lithium-ion battery business in 2018 if the battery development and order-taking proceed as expected. They will also consolidate their manufacturing subsidiary companies in Japan, Europe and the U.S. and build new plants in Europe and China.

(Note) Bosch reportedly commented on the defect of GS Yuasa batteries installed in the Boeing 787 and MMC's i-MiEV and Outlander PHV. In Bosch's view, the defect resulted from the manufacturing process and management and not from the lithium-ion battery cell itself.

Bosch: Joint-venture with Samsung SDI dissolved
 In September 2012, Bosch dissolved SB LiMotive, a joint venture established with Samsung SDI, a Korean corporation, due to disagreement regarding its management. At the same time, Bosch acquired SB LiMotive's subsidiaries in Germany and the U.S. In addition, Bosch bought Cobasys, an American battery manufacturer that was under the umbrella of the joint venture. Cobasys has expertise in producing Ni-MH batteries and also in battery management systems in general. According to Bosch, Cobasys will play an important role in the growth of its battery business in the U.S.
 Samsung SDI received orders for batteries from BMW and Chrysler granted by way of SB LiMotive, the joint venture with Bosch.

 

 



Panasonic: Increasing production capacity for automotive lithium-ion batteries

 Panasonic's consolidated results showed deficits in excess of JPY 700 billion consecutively in FY 2011 and FY 2012. The lithium-ion battery business is said to have ended FY 2012 in deficits due to price wars with Chinese and Korean manufacturers. Several business improving efforts have been made to correct the situation. For example, the Kaizuka plant in Osaka that was producing lithium-ion batteries for small consumer devices was closed in March 2013. The plant's equipment was removed to the Suzhou plant in Jiangsu, China, that began production in the first half of 2012. Panasonic intends to increase the production ratio of batteries for consumer devices in China from 30% in FY 2012 to 50% in FY 2013 (production at three plants in China including the Suzhou plant).

 As for the batteries for automotive use, Panasonic will follow "omnidirectional strategy" since orders have been granted by five automakers for more than 10 models including Toyota (Prius PHV), Ford (Fusion/C-Max), Tesla Motors (Model S) and Audi (Q5). The company invested over JPY 20 billion in its two plants in FY 2013. Panasonic installed a production line in Kasai plant (Hyogo Pref.) in the summer of 2013 for making rectangular batteries. The Suminoe plant, Osaka, is busy with full-capacity production of cylindrical batteries for Tesla Motors' Model S. Panasonic will relocate idling lines from other plants in early 2014 to increase capacity at the Suminoe plant. The Kaizuka plant, currently closed, will start production of automotive lithium-ion batteries in FY 2014.

 Panasonic's lithium-ion battery business is improving with a growing demand for the Model S and for the backup power supplies at cellphone base stations in Southeast Asia, and the correction of super-strong yen, etc. As a result, the company is likely to report profits in automotive lithium-ion battery business in FY 2013. Panasonic is predicting sales of JPY 130 billion in the division in FY 2015.

 

 



Toshiba: Consolidating production and development to Kashiwazaki plant

 Toshiba has developed SCiB (Super-Charge Ion Battery) which is lithium-ion battery characterized by long life and outstanding quick charging performance. Its automotive applications include the Honda Fit EV, MMC i-MiEV/Minicab MiEV (maximum capacity of 10.5kWh), and Suzuki's ENE-CHARGE regenerative braking system installed on the Wagon R and other models since September 2012.

 Toshiba plans to launch high-performance batteries after 2015 that have either larger capacity or the same capacity with smaller volume than existing products. Toshiba plans to introduce these new batteries to increase its customers.

 Toshiba's development and trial production has been performed at the Saku plant in Nagano Prefecture, and commercial production of batteries at the Kashiwazaki plant in Niigata Prefecture. Since March 2013, all activities from development to production of lithium-ion batteries have been consolidated to the Kashiwazaki plant. With this consolidation, the company aims to increase the efficiency of development of storage batteries not only for automotive, home and industrial applications but also for energy storage systems in smart grid and other applications. The streamlined operations will also enable the company to meet sudden increase in demand in a timely manner.

 

 



TDK: Orders for lithium-ion batteries for 1,000 EVs granted by Beijing Automobile Works

 In 2005, TDK acquired Amperex Technology (in Hong Kong) and took over the lithium-ion battery business for smartphones and other use. Amperex Technology was responsible for development and production of the batteries. Since then, TDK developed automotive batteries and won initial orders covering FY 2013 for lithium-ion batteries for 1,000 electric vehicles from Beijing Automobile Works. TDK is new in this market but plans to turn the battery business into one of the pillars of its automotive product business on a global scale.

 

Other manufacturers of lithium-ion batteries

 Mitsubishi Heavy Industries (MHI), IHI, Eliiy Power and Murata Manufacturing are among other manufacturers that are planning to advance to the automotive lithium-ion battery market.

 MHI has developed MLiX batteries for stationary and mobile use. Its automotive batteries are used on the MHI forklifts and electric buses.

 IHI is associated with A123 Systems, a U.S. corporation that supplies batteries to BMW, GM, Mercedes-Benz, etc. IHI will receive supplies of cells from A123 Systems and combine them with control units before they are delivered to automakers.

 Eliiy Power built a second plant in Kawasaki City in June 2012. The company is a leading manufacturer of batteries for home use and has been aspiring to advance to the automotive market. In April 2012, Suzuki invested in Eliiy Power and the two companies began joint development of batteries for automotive use. In August 2013, Suzuki suspended the development of the Swift-based PHV but is said to continue research and development of electric vehicle technologies.

 

 



Nippon Chemi-Con: Capacitors for Mazda Axela and Honda Fit

 Unlike the chemical reactions in rechargeable batteries, the capacitors charge and discharge electrical energy by ion absorption and desorption in the electrolyte. This leads to several advantages that include fast charge and discharge of a large amount of electricity and little degradation over frequent charge cycles. Their storage density is generally lower than that of batteries which makes it impractical to use capacitors as a substitute for lithium-ion batteries or lead storage batteries. However, capacitors are expected to play an important role when used in conjunction with batteries as an auxiliary power supply for start/stop and starting systems. Capacitors are divided into two types, electric double-layer capacitors (EDLC) and lithium-ion capacitors. Many manufacturers are presenting their samples to automakers to promote their capacitors.

 Among Japanese manufacturers, Nippon Chemi-Con is leading and its EDLC are used in the "i-ELOOP" regenerative braking system for Mazda's all-new Atenza launched in November 2012. Nippon Chemi-Con's EDLC are also used in Honda's all-new Fit and Mazda's all-new Axela launched in the fall of 2013.

Nippon Chemi-Con: Supplying electric double-layer capacitors to Mazda and Honda

Mazda Atenza  The all-new Atenza, launched by Mazda in November 2012, is fitted with the "i-ELOOP" regenerative braking system in which Nippon Chemi-Con's EDLC are used. The regenerated electricity is used to keep air-conditioning and other electric equipment operative while the engine is turned off by a start/stop system. Since fuel is not used to run the engine and keep electric equipment operative, the system contributes to up to 10% improvement in fuel consumption. The regenerated electricity is also stored in lead storage battery and used to drive the starter motor when restarting the engine. This reduces the load to the lead storage battery and contributes to extending its life.
Mazda Axela  The start/stop ("i-stop") and "i-ELOOP" systems are standard features in Mazda's all-new Axela series launched in the fall of 2013 that are powered by 2000cc petrol and 2200cc diesel-fueled engines.
Honda Fit  A start/stop system is standard on Honda's all-new Fit series launched in September 2013. With a 1300cc Atkinson-cycle engine and capacitors used to store electricity to supplement the start/stop system, the front-wheel drive models with CVT have realized high fuel efficiency of 26.0km/liter in JC08 mode test.

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