Have battery makers become more important for electric cars than carmakers?

Batteries are vital to electric cars. But does that mean the companies that make the cells that go into those battery packs have become more important than the carmakers themselves?

|
Francois Mori/AP
A Renault employee works on the electric batteries for the Zoe cars on the assembly line of the Renault plant in Flins, west of Paris (April 20, 2016).

When it comes to electric cars, range and cost are still two of the biggest obstacles barring the way to mass adoption.

Carmakers strive to put battery packs with the most capacity at the lowest price in their vehicles to make them more attractive to consumers.

That makes the companies that manufacture the cells that go into those packs more important than ever.

But could they become more important than the carmakers themselves?

Battery suppliers may soon become the "lead actors" in electric-car development, suggests a recent Navigant Research blog post.

LG Chem is most likely to invite analysts to draw that conclusion.

The Korean company partnered with General Motors to supply batteries for the 2017 Chevrolet Bolt EV.

But it also provides a wide variety of other components, from the drive motor to the instrument cluster—some designed by GM, others designed in-house by LG Chem.

The far-reaching partnership was likely what allowed GM to follow such an aggressive timeline for the launch of its 200-mile electric car.

The Bolt EV was first shown as a concept in January 2015 at the Detroit Auto Show, and is scheduled to go into production before the end of this year.

Panasonic is also heavily involved with its main client, Tesla Motors.

The Japanese electronics company is providing both cash and technical expertise for Tesla's lithium-ion cell "Gigafactory" near Reno, Nevada.

Panasonic is also poised to enter the Chinese electric-car market through a partnership with Dalian Levear Electric Company.

Chinese carmakers usually rely heavily on foreign input, so it will be interesting to see how Panasonic's relationship with companies in the country takes shape.

While GM and Tesla benefit from these collaborations, the growing influence of battery suppliers recently triggered some nervous comments from Sergio Machrionne, CEO of Fiat Chrysler Automobiles.

Hardly a fan of electric cars to start with, Marchionne said in January that electric powertrains will lead carmakers to cede control of basic vehicle design to suppliers.

Internal-combustion powertrains are the only area of car design where automakers still control proprietary knowledge, Marchionne said; a switch to electric powertrains would erase that.

There's also nothing stopping suppliers from selling battery cells and other components to new, non-traditional automakers.

Many analysts expect electric powertrains to facilitate the entry of companies like Apple into the car industry.

Startups like Faraday Future are already trying to repeat the success of Tesla, and British vacuum manufacturer Dyson is also rumored to be mulling an electric car.

It's also worth noting that giant consumer-electronics company Samsung sells cars under its own brand in South Korea, its home country.

While those are presently rebadged versions of Renault products, who's to say the company might not branch out into designing its own electric cars in the future?

This article first appeared at GreenCarReports.

You've read  of  free articles. Subscribe to continue.
Real news can be honest, hopeful, credible, constructive.
What is the Monitor difference? Tackling the tough headlines – with humanity. Listening to sources – with respect. Seeing the story that others are missing by reporting what so often gets overlooked: the values that connect us. That’s Monitor reporting – news that changes how you see the world.

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to CSMonitor.com.

QR Code to Have battery makers become more important for electric cars than carmakers?
Read this article in
https://www.csmonitor.com/Business/In-Gear/2016/0425/Have-battery-makers-become-more-important-for-electric-cars-than-carmakers
QR Code to Subscription page
Start your subscription today
https://www.csmonitor.com/subscribe