Which industry grew 263 percent in Q4, 2020?
Frans Timmermans once told European news organization POLITICO - “I don’t always get the easiest jobs…...”
It would be hard to disagree. Frans is the European Commission’s leader in charge of the EU’s Green Deal and has the vision of making Europe the world’s first climate-neutral Continent; his mandate ranges from climate policy to environment, water, taxes, and coordinating the region’s shift away from fossil fuels by cutting pollution from transport and other key areas. For road transport which produces the major share of pollution, there needs to be at least 30 million zero-emission cars on the road by 2030 for the region to hit its targets.
Frans will probably be interested to learn the answer to the Title question.
According to the European Automobile Manufacturers Union, Electric Vehicles (EV) grew 263% year-over-year in the fourth quarter 2020, and almost one in 6 passenger cars sold in the EU was an EV.
Overall, EVs comprised 10.5% of total car sales in the EU in 2020 (Table below).
So, are we at a tipping point as far as EVs are concerned?
Geoffrey Moore in his landmark Marketing treatise Crossing The Chasm describes the chasm that exists between the early adopters of a new product and the rest of the mainstream market; and traversing that chasm is what it takes to get from early traction to market tipping points and hockey-stick growth. The chasm exists because the two groups have different expectations for the product. Early adopters are technology enthusiasts who are quick to appreciate the advanced features of a product; in contrast, the mainstream tends to look at products holistically, i.e. the whole ecosystem around the product also needs to be in place. More important - the mainstream expects price to be competitive because R&D investments have been amortized and every bit of technology and manufacturing learning has been taken advantage of.
Cost of EVs
The average price differential between a small to medium-sized EV and ICE auto is still high - it is about U.S.$13K today. Consider the starting price of the different Tesla models below, the least expensive one is $37K:
EVs are still too expensive for middle and low-income consumers. At Tesla’s Battery Day event, Elon Musk announced an aggressive target: A $25K entry-level electric car in three years. Meeting this target would be critical if Tesla wants to achieve their goal of capturing 1% of global cars on the road (20 million cars). Meeting this target though requires finding new savings in technology, primarily in battery technology since the battery in an EV can constitute as much as one-third of the purchase price.
A meeting in the autumn
I remember a meeting in the autumn of 1999. I was a hardware manager leading a team of modem designers at Panasonic’s Handset Design Center, and in a meeting one of our suppliers informed us they were transitioning palladium-based multilayer ceramic-chip capacitors (MLCC) used in cellphones to nickel-based, due to the scarcity of palladium. We were initially pleased to hear this because prices of nickel-based MLCCs were dramatically lower; the cost of nickel per ounce was about 1/20th the cost of palladium. Our enthusiasm was somewhat muted later though as we came to realize that nickel-based MLCCs don’t last as long, and production and equipment costs are much higher.
There is an analogy with EV batteries. EV batteries are expensive. Prices have come down dramatically over the last decade, and now the price is about $150 per kWh (Table below) – but that needs to come down to less than $100/kWh for an EV to achieve price parity with an ICE.
EV batteries are expensive because of what goes in them, the metals typically used for the cathode - lithium, manganese, cobalt - are accessible in only a few regions of the world. Cobalt is very rare and exists only in a few regions: Chile, China, and Democratic Republic of Congo. Therefore, the industry is attempting to transition from cobalt to more prevalent materials such as - who would have thought - Nickel! The problem though is that nickel-based technology can overheat and catch fire; thus, it is imperative to make safety adjustments in the design and perform rigorous battery testing.
Battery Design & Test solutions
Conversations with OEMs suggest the following are some of their key Test requirements:
- Predefined standard tests as well as customized tests including impedance measuring
- Regeneration capabilities that ensure energy- and cost-efficiency
- Constant measurement precision using the module as a cell test system, reproducible results, reliable power electronics
- Impedance spectroscopy in channels
- Synchronized recording of measurement data with time stamp for analysis of data in a millisecond pattern
Keysight’s Battery Test systems include the ability to reliably test battery cells, modules, packs, and battery management systems. Specifically, the Energy Storage Discover (ESD) software can run customized performance, function, aging, and environmental tests - including tests for standards compliance and conformance (ISO, DIN EN, SAE). ESD software allows all components of the test bench to be controlled and monitored, and ensures that predefined standard tests and individual test procedures can be carried out. Furthermore, characteristic key data can be determined immediately during the test procedure, and the results are reproducible. The user benefits from the intuitive operation, visualization of extensive measurement data volumes, and export to all common file formats.
Keysight Battery Test System
We must wonder whether for Frans Timmermans, the growth in EVs and his mandate to cut emissions might feel bitter-sweet. His childhood and family were steeped in the fossil-fuel industry, both his grandfathers were miners in the Dutch coal industry. If so, he does not seem to show it; he seems laser-focused on the vision for a climate-neutral Europe and continuing the early successes in EVs to scale and market penetration.
Now it is up to automotive engineers and battery technologists to fulfill that vision.
For further information on EV battery design and test, please reach out or go to: