April 10, 2017 5:50 pm JST

Japan ahead in race to standardize car-use battery tech

Parts makers see big payday if electric cars gain widespread acceptance

Toray Industries uses a proprietary material in the lithium-ion battery separators in this concept car, unveiled in the fall.

TOKYO -- Automakers are in a heated competition to get electric vehicles to go farther on a single charge.

But the key to whether these cars go mainstream is in the pocket of Japanese parts makers. These component producers own the core technologies for tomorrow's batteries.

Actually, the heated competition is about more than simply getting electric cars to travel long distances. It's also about getting the technology that will allow for this to be standardized. Without standardization, consumers are unlikely to embrace electric cars en masse. In recharging their batteries, they will want the same convenience they enjoy today when it comes time to filling up their gas tanks -- a lot of stations to choose from.

This means standards that allow all cars to charge up at all stations.

Now imagine selling your technology to recharging stations around the world. This is how high the stakes are.

Already, electric cars are taking off. BYD, one of China's leading automakers, said it logged a consolidated net profit of 5 billion yuan ($732 million) in 2016, up 79% from the previous year. BYD in 2016 sold 96,000 electric vehicles and plug-in hybrids in China, an increase of 70% from the preceding year, it said.

China is not the only country that is hungry for easier-on-the-environment cars. Europe is toughening clean-air regulations, ensuring that electric vehicles will gain more of the overall car market there.

Around the world, electric vehicle sales are forecast to grow from around 400,000 units in 2016 to 2.5 million in 2025. This will greatly increase demand for car-use lithium-ion batteries.

These batteries have capacities that are thousands of times more powerful than what powers your smartphone.

In Japan, hybrid vehicles -- those that have gasoline engines and electric motors -- are the so-called "green" alternative to cars powered only by internal combustion engines.

Nissan Motor in 2010 released the Leaf, a fully electric car, but only about 260,000 have been sold. The Leaf can only go so far on a single charge, and there aren't many charging stations out there.

The car can keep going for 280km before needing to be charged again. If a driver were to take one from Tokyo to Osaka, he or she would have to stop twice along the way. And that's without running the air conditioner.

This is the big challenge -- how do we increase the capacity of lithium-ion batteries so electric cars can get more mileage on a single charge? Battery makers are furiously trying to come up with answers.

A lithium-ion battery consists of four core elements -- a positive electrode using lithium oxide as its primary compound, a negative electrode adopting black lead and other materials, an electrolysis solution that moves ions through electrochemical reaction and a separator to prevent a short circuit among the positive and negative electrode materials.

Japanese chemical makers have niche technologies for all four of these elements.

Toyota Motor and Tokyo Institute of Technology have developed a technology to increase the amount of electricity that each cell can store so that an electric car can go farther on a single charge. The technology uses an electrolyte of an inorganic and solid-state crystal structure having sulfur, lithium and other compounds lined up in a reticular pattern.

The organic liquid used in today's lithium-ion batteries can easily catch fire. This was the problem last summer with all those Samsung Electronics smartphones.

An inorganic, solid-state electrolyte increases the capacity of batteries as it works in a wide range of temperatures, from minus 40 C to 100 C, and allows for a strong flow of electricity.

If this kind of electrolyte can be used in the automobile batteries of the future, the cars would be able to go 500km on a single charge. That means no stopping from Tokyo to Osaka.

"The developed battery is small but high in performance," said Ryoji Kanno, a professor at Tokyo Institute of Technology. "We are now trying to enlarge the battery."

Optical glass maker Ohara has also adopted a solid-state electrolyte in developing a next-generation battery made of ceramics that can withstand global environmental extremes and temperatures from minus 30 C to 200 C.

When Ohara in August took the wraps off a prototype battery, its stock went limit-up -- a jump of 19%.

"Inquires [about the battery] have been increasing, partly because it does not degrade with age without reacting to water," executive officer Kosuke Nakajima said.

Many other companies, including Idemitsu Kosan and Murata Mfg., are competing in the solidification of electrolytes.

The development of materials for positive electrodes in solid-state batteries is also making headway. When FDK, a member of the Fujitsu group, in late February announced the development of a safer positive electrode material for solid-state batteries in late February, its shares also went limit up -- a 42% increase.

Processing materials technologies are also advancing. Hitachi Zosen has developed a pressurizing system to harden solid-state electrolytes as powder. Kazuyuki Sunayama, head of the battery group, part of the functional materials section at the industrial equipment maker, said the system makes for an efficient and low-cost manufacturing method.

"We will make it applicable to mass production of batteries for automobiles," Sunayama said.

While attention focuses on new technologies, investors may also seek clues from capital investment to upgrade the quality of lithium-ion batteries and prepare mass production systems.

Let's look at Tesla. The electric car startup has been making a lot of noise in the U.S. and on April 4 surpassed Ford Motor in terms of market capitalization. It and Panasonic in January began operating a huge battery plant in the U.S. The $5 billion center will make batteries for the Tesla Model 3, a mass-production electric vehicle that the Palo Alto, California-based automaker plans to start making later this year.

Tesla received advance orders for some 400,000 Model 3s in the first month of beginning to accept them in March 2016. Part of the Model 3's appeal is its relatively low sticker price, starting at $35,000.

Later this month, Panasonic will open a plant in Dalian, China, to produce square Li-ion batteries for use in plug-in hybrid and other vehicles. The company considers the plant's China location to be strategic; it expects to supply batteries to Japanese and European automakers operating in China.

The plant is already getting orders at a faster pace than expected.

Asahi Kasei, the biggest insulating material maker, will spend much more than 10 billion yen ($90 million) to boost its production capacity by some 30%.

But Toray Industries wants to capture the largest share of the separators market "within three years," said Akihiro Nikkaku, president of the leading synthetic fiber maker.

Sumitomo Chemical, meanwhile, has raised its insulating material production capacity at a cost of 20 billion yen. And in the fall, it made Tanaka Chemical, a producer of positive electrodes, a subsidiary.

No one yet knows what next-generation batteries will use as their main element. While lithium is getting a lot of attention, Nissan Motor and Saga University are planning to develop a next-generation battery using natrium.

Will the partnership get to the finish line? There are plenty of other companies and consortia trying to come up with their own technologies -- and have them adopted as standards.

(Nikkei)

Nissan Motor Co., Ltd.

Japan

Market(Ticker): TKS(7201)
Sector:
Industry:
Consumer Durables
Motor Vehicles
Market cap(USD): 40,057.4M
Shares: 4,220.72M
Asia300

BYD Co. Ltd.

China

Market(Ticker): HKG(1211)
Sector:
Industry:
Consumer Durables
Motor Vehicles
Market cap(USD): 19,055.7M
Shares: 2,728.14M

Toyota Motor Corp.

Japan

Market(Ticker): TKS(7203)
Sector:
Industry:
Consumer Durables
Motor Vehicles
Market cap(USD): 175,017M
Shares: 3,263M
Asia300

Samsung Electronics Co., Ltd.

South Korea

Market(Ticker): KRX(005930)
Sector:
Industry:
Electronic Technology
Telecommunications Equipment
Market cap(USD): 281,429M
Shares: 161.19M

Ohara Inc.

Japan

Market(Ticker): TKS(5218)
Sector:
Industry:
Electronic Technology
Electronic Components
Market cap(USD): 258.09M
Shares: 25.45M

Idemitsu Kosan Co., Ltd.

Japan

Market(Ticker): TKS(5019)
Sector:
Industry:
Energy Minerals
Integrated Oil
Market cap(USD): 5,100.77M
Shares: 160M

Murata Manufacturing Co. Ltd.

Japan

Market(Ticker): TKS(6981)
Sector:
Industry:
Electronic Technology
Electronic Components
Market cap(USD): 29,375.5M
Shares: 225.26M

FDK Corp.

Japan

Market(Ticker): TKS(6955)
Sector:
Industry:
Electronic Technology
Electronic Components
Market cap(USD): 303.06M
Shares: 280.36M

Fujitsu Ltd.

Japan

Market(Ticker): TKS(6702)
Sector:
Industry:
Technology Services
Information Technology Services
Market cap(USD): 12,711M
Shares: 2,070.02M

Hitachi Zosen Corp.

Japan

Market(Ticker): TKS(7004)
Sector:
Industry:
Producer Manufacturing
Industrial Conglomerates
Market cap(USD): 971.45M
Shares: 170.21M

Panasonic Corp.

Japan

Market(Ticker): TKS(6752)
Sector:
Industry:
Consumer Durables
Electronics/Appliances
Market cap(USD): 28,438.4M
Shares: 2,453.05M

Asahi Kasei Corp.

Japan

Market(Ticker): TKS(3407)
Sector:
Industry:
Process Industries
Chemicals: Major Diversified
Market cap(USD): 13,395.3M
Shares: 1,402.62M

Toray Industries, Inc.

Japan

Market(Ticker): TKS(3402)
Sector:
Industry:
Process Industries
Textiles
Market cap(USD): 14,359.9M
Shares: 1,631.48M

Sumitomo Chemical Co., Ltd.

Japan

Market(Ticker): TKS(4005)
Sector:
Industry:
Process Industries
Chemicals: Specialty
Market cap(USD): 9,099.19M
Shares: 1,655.45M

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