Automakers have to make cheap electric vehicles if they want people to be able to afford them. Many methods have been used to cut down on the cost of producing electric cars, including the automation of various processes. But, it seems in order for manufacturers to drastically reduce the cost of EV production, they have to take control of the production of its power source.
GM is investing in battery technology to help reduce the cost of its EVs, but so are other manufacturers. Hyundai has also been investing in battery technology for its future EVs as a way to reduce costs. However, Hyundai is not just trying to make battery production cheaper, but greatly improving its current battery technology beyond what is available on the market.
Hyundai Is Developing The Largest LFP Battery
Hyundai has set a target to develop the largest lithium iron phosphate (LFP) battery in the industry. This comes as big news since Hyundai is going up against some of the biggest battery makers in China like BYD and CATL that are responsible for 90-percent of the industry’s battery production.
CATL currently supplies most of the battery packs used in EVs and hybrids from BMW, Daimler AG, Honda, Tesla, Toyota, Volkswagen, Volvo, and Hyundai. Hyundai plans to make a bigger and more energy-dense battery that surpasses the current industry benchmark.
Hyundai has partnered with a domestic battery partner to develop an ultra-high capacity battery capable of 300 Wh/kg. Similar LFP batteries currently in production have a battery density of 210 Wh/kg. By taking control of its battery production process and working closely with its new partners, Hyundai plans to leapfrog its competitors in battery technology. This will be a huge feat for Hyundai since they have been working on this for a while with plans to unveil it in 2024, but it plans to finalize this by 2025.
What This Means For The EV Industry
Hyundai plans to disrupt the current EV industry, since LFP batteries are currently cheaper to manufacture than other types of batteries. Hyundai’s new battery promises to have more battery density and also keep costs low, which means future EVs from the brand will be cheaper and have more power and range. For comparison, this energy value is the same as the best nickel manganese cobalt (NMC) battery in production. Hyundai plans to match this energy value but cost significantly less.
This aggressive move shows Hyundai’s intent to become a major player in the battery and EV industry as a whole. If done right, Hyundai may break the dominance of the Chinese manufacturers and create better electric vehicles and advanced battery solutions. But this will also have a ripple effect on the industry, as other automakers may decide to develop their batteries or simply move to Hyundai as a supplier.
Other battery suppliers won’t just watch idly, and this may lead to healthy competition for newer and better battery solutions. LFP batteries do not qualify for the EV government tax credit, but if the cars get cheaper with this technology, we may not need the tax credits after all.
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