Chinese companies plan to be producing over 120GWH/year in battery cells by 2021 | Hacker News Reader

Chinese companies plan to be producing over 120GWH/year in battery cells by 2021

bloomberg.com

59 pointsrayuela58 comments

Even though I'm dubious about government being too involved in business, a couple things stood out to me:

the Chinese government has launched a sweeping effort to increase the country’s dominant market share.

“This is about industrial policy. The Chinese government sees lithium-ion batteries as a hugely important industry in the 2020s and beyond,”

That’s a huge opportunity, and China doesn’t want to miss it.

While its entirely possible that people in the government make the totally wrong decision and end up wasting taxpayer dollars, this kind of forethought makes me feel that the US is going to be left in the dust in terms of renewable technology. I know there is a patchwork of federal and state money that probably goes into things like the gigafactory in Nevada, investment on this scale by the government seems like a total pipe dream here, it hurts to see how backwards our government is moving on energy. I can see how people will just say "let the market handle it" but when the best case scenario is you save the world for future generations and the worst case is you simply lose some money it seems like a no-brainer.

On the other hand, tying government and industry together like that is likely to lead to bad outcomes from regulation. If everyone is pulling together, there will be pressure on environmental regulators to look the other way when there's an issue which will cost money. Even somewhere like France you had issues with nuclear, and expectations of transparency in China should be a lot lower.

Agreed, there are bad examples and good examples. Government trying to hold the leash and control companies: bad. Government using massive purchasing power and national and international leverage: good. With more direct government involvement we could have a Manhattan project for renewable energy, or apollo program.

Instead we get crony capitalism and talk about the free market, when entrenched industries have a clear advantage. With regulated monopolies providing power nationwide, I think it is far too up to the individual power companies to implement renewables.

I imagine the day that we find out we did too little too late, and have to look back and wonder why the hell we more or less left it up to purely market forces (which don't factor environmental damages in almost at all). We might wish that we had put some of the money we wasted in the middle east into reforming our power grids.

What was true at one time isn't necessarily true at another of course. But it may be worth observing that in the 1980s there was a huge amount of hand-wringing over how Japan's government and industry partnerships around industrial policy were going to make the US uncompetitive. This led to projects like SEMATECH in the semiconductor field.

I do think government has a role to play in research and encouraging technology development generally. I'm far less convinced that it has to or should play a large direct role.

Tesla has been spinning their gigafactories for years now, though. The fact that the federal government doesn't do the planning doesn't really have any bearing as to whether the "US" is being "left in the dust". Those factory plans are real, they're being built (with a huge infusion of capital from a bunch of different sources). It's happening.

Now, it might be the case that the PRC government's resources are superior, that they'll end up being able to outproduce Tesla et. al. in volume and undercut them in price, and that they'll ultimately "win" this battle. But that's not due to a lack of planning or resources in the US.

"the US is going to be left in the dust in terms of renewable technology"

China is already dominating the battery and solar panel industry. You really have to stop thinking of the US as being #1.

The parent never said that the US is #1. He just implied that they're not "left in the dust" yet, whatever that might mean.

They have the cheapest panels, sure, but that's because they're being actively subsidized in an attempt to kill of competition. To my knowledge SunPower still has the highest efficiency production panels and First Solar still has the lowest demonstrated cost per watt for anything over moderate insolation.

Granted that is a common misconception in my country (luckily it is showing some wear) but that wasn't really what I meant. We have the capacity to be #1 in renewable energy in terms of capital and knowledge, but unfortunately we don't have the drive and we have a population where a fair percentage of us would burn coal just to spite the rest of the world.

This is why all the freaking dinosaurs in government should be set out to pasture. They are all self serving douchebags who have no vision of the future.

Just trying to work out how they claim Tesla will be "flooded". The forecasted demand in the article is going to outstrip both China's increase and Tesla's increase by 2024, and China's major market for their increase will be domestic, per the article.

   Current demand: ~75 Gigawatt Hours (GWh)
   2021 demand: ~160 GWh
   2022 demand: ~195 GWh
   2024 demand: ~290 GWh

So the market will need an additional 85GWh by 2021, 110GWh by 2022, and 215GWh by 2024.

Tesla is adding 35GWh by 2018. China is adding 120GWh by 2021. 120 + 35 = 155GWh < 215GWh.

Seems like Tesla will be in a really good spot. They'll have a > 10% share of a highly in demand product and likely be seen as one of the premium/high quality options.

Plus Elon has said he wants about 10 Gigafactory to meet demand. On another note, I would be interested to hear from anyone in the industry about the state of Battery Technology. Keep hearing about the demand for Cobalt and how Congo controls about 60% of the world's cobalt supplies and all the moral issues around mining there. Are there good alternatives to using cobalt in battery construction?

edit: Also curious about the impact of older batteries to the environment. I see all this talk about moving to EV because it's cleaner tech, but is that true if we have a billion batteries sitting in the landfills at some point?

China and Tesla are not the only players. There are 100s of other new manufacturers. And a few big names as well. The biggest battery technology patent holders Panasonic and Toshiba, LG, Samsung. GM is up there too.

Every single time I see the word battery, my mind involuntarily jumps to "toxic waste"

What is any country or company doing to deal with the massive toxic waste that will come from expired batteries?

Does tesla have a giga-recycle program?

How many duracells have you thrown out in your lifetime?

What is the sustainability of the minerals that are mined that go into battery production.

All these and more, should all have rock-solid ELI5 answers to how they are being dealt with.

If there is any startup that may want to have a positive impact on the future, figuring out how to deal with battery waste may be a good one...

Yeah, especially concerning given that no battery manufacturers are currently geared up to recycle old batteries.

Won't this be a good thing for everyone, even Tesla?

Elon's been saying this from the beginning, he understands that is what will happen. I imagine part of being able to move forward with big ambitions is you have to make peace with that fact - otherwise fear of the unknown, of competition, will easily overwhelm you.

It's more than that. That was the whole point. Tesla was built to electrify transport. Not to be the dominant player forever, but to force other market players into this game.

Depends on how much they've committed to their gigafactory.

The article implies that the Chinese batteries will be of equal or better quality than the ones Tesla manufactures, which is a dubious assumption. Cheaper goods are a good thing for everyone, but I can't believe up front that China will be able to match the quality required for a Tesla vehicle.

China manages to make iPhones - it's entirely possible to make high quality goods there, if it's a priority for the folks paying the bills and they're willing to put some supply chain management into it. "Make me this as cheap as possible" being the only instruction won't get you there, of course.

It's not a coincidence that work is done by Foxconn and not a local partner.

China has fantastic human capital. The problem is usually incentives and culture, especially for blue collar work.

My understanding was that the Gigafactory was conceived out of necessity as least as much as opportunism. That is necessity for a large stable source for batteries over which Tesla has quality control. Had they been able to find that elsewhere, they wouldn't necessarily be in the battery-making business.

All that is to say, I think (hope) that Tesla doesn't see what is essentially a commodity business--albeit one with some innovation baked in--as a driver of their enterprise moving forward. As such I think they should welcome competition in that space.

Not for other battery makers like Tesla, if they overestimate demand and flood the market with cheap batteries.

I have a related question: Does this mean the top lithium-producing countries[0] will experience an economic boom, similar to oil producers in the '70s, or is lithium abundant enough in the US and China to satisfy future demand?

[0] https://en.wikipedia.org/wiki/List_of_countries_by_lithium_p...

The lithium prices may experience continue to increase, but lithium is highly abundant. It won't help the "countries" that much. The US and china has tons of lithium and so do many countries across the world. But most likely, lithium prices may start to decline if the US/Russia/China/etc who have most of the world's lithium decide to start mining seriously.

Certainly well connected mining companies might do well also. But lithium isn't oil. Oil is the basis of modern civilization. It is in pretty much every product you use and every industrial process. Even battery companies will use tons of oil and oil byproducts to create lithium batteries.

Oil and lithium batteries aren't comparable. One is foundational, the other is really a convenience.

Yes, there was an article about this in last week's Economist. Bolivia, Argentina, and Chile are the top 3 lithium countries. Due to the politics of Bolivia and Argentina, Chile is the best positioned to take massive advantage of it.

https://www.economist.com/news/americas/21723451-three-south... [Paywall]

https://www.economist.com/blogs/graphicdetail/2017/06/daily-... [No Paywall]

Is the battery industry really going to become a zero-sum game between China and one guy? Shame on western economies for not paying attention to this stuff until the tech becomes dirt cheap (at which point, China is always already dominating).

Almost the same story with solar panels.

And REEs, and commercial genomics, and commodity SoCs, and greentech, and mass produced CFRPs and so many other things

China systematically seals all upcoming greenfield opportunities for tech companies and industry in West. A very smart play

There are plenty of non-Musk factories being built in the West, they just don't get the mainstream press :

https://www.greentechmedia.com/articles/read/10-battery-giga...

Before we know it, 1TWh worth of battery storage will be produced every year. That should make EV batteries and EVs in general quite cost-competitive.

Battery production, recycling, etc and the batteries themselves are very toxic. Seems like we are trading one form of pollution ( polluting the atmostphere ) with poisoning our land. I remember it wasn't too long ago where we were told not to use too many batteries because they were toxic...

Nickel Cadmium (typical rechargeable) and Silver Oxide (watch batteries w/ mercury) are bad. Lead Acid (cars) are very recyclable, and considering there is no new lead production in the US, will command a premium for recycling. I don't think Carbon Zinc and most Lithiums are a problem.

Quality will be noticibly shitty enough that there will still be a market for Tesla.

Unlikely the last decade China has been pushing its industries to go from cheap and mass produced to better qualities at higher prices

As was already pointed out I believe that one of the most interesting opportunities will not lie in producing the battery but on ecologically manage those already produced.

So an entire country of 1.3B people, with 8 factories under construction and a dozen or so more announced are going to outproduce one US factory. Okay, why is that news?

Seriously Bloomberg - this is what Elon has been saying publicly since day 1, the entire Tesla vision was built on batteries getting cheaper and more available.

The Gigfactory is important to Tesla not merely because of it's scale, but for the advantages of vertical integration for QC, capacity planning, supply chain stability, etc. The same reason auto manufacturers had their own steel plants back in the early days.

Because that one factory pretty much represents all the battery production outside of China.

The article discusses how China is building 4 gigafactories worth of capacity by 2020.

It's unclear what your tone signifies, muddying your message. It's a couple commonly known truths about Tesla, with a tone of "take THAT Bloomberg!"

My point is the article doesn’t make much sense - comparing a country’s output of anything to a single factory is of little to no point. The entire article is fluff produced so Bloomberg could have a snazzy sounding headline: “China Is About to Bury Elon Musk in Batteries”

The fact hat the headline on HN was changed to be less clickbaity instead of matching the original pretty much says it all...

I would worry about quality.

quality.

I would expect many things to be prone to fires like both Samsung and Takata. I wouldn't trust them in a Prius, a Tesla, or a Galaxy Note. Gas tanks haven't spontaneously burned down cars for over a century, but they will do it this century. Put money on that. I expect the first examples will be shown in China, where manufacturers (21+ of them) can put carcinogenic insecticidal fire-retardant poison in infant milk and pet food for years with what is effectively impunity until it hits newspapers. This will translate to electric vehicles.

Lithium Ion is always prone to fire. If you wrap it in a hard-enough case so it can't be punctured, and then slap electronics on the end to "emergency cut power" when a catastrophe is detected... you can prevent the fires.

The issue with Samsung's "explosive" battery was that it had to be thin (so it had a soft case), and when you sat on it... it'd bend internal connections and then short them out.

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Honestly... I'd expect China to build the typical 18650-cell without any issues.

Unfortunately for China, Tesla isn't putting "typical" 18650 cells into their cars. They're putting in Silicon enhanced Lithium Ion with optimized chemistry for maximum power with minimum weight.

THAT's the problem. I don't think there's a very big marketplace for "typical" Lithium Ion cells. Its about the recent innovations that have made batteries lighter, more flexible, and deliver more power.

So the real question is: can China build Silicon-Lithium Ion Cells to the specifications of Tesla's Gigafactory? I have my doubts. There's a reason why Elon Musk built his own factory (with help from Panasonic)

China was making superior EV cells since around 2012. For some time, they banned export of unfinished cells and cell materials to favour makers of complete battery packs.

This is what led to EV and hybrid car makers outside of China having to use battery packs made out of consumer grade cylindrical cells for a while.

Tesla Motors guys have seem to have realized now how ridiculous was the decision to build battery packs from small cells, and announced that they will be transitioning to slightly bigger cylindrical cells for model S.

Still, current model S ships with commodity size cells. They may have decided that it does not worth effort changing to big cells when they have just got their factory running with tooling made for standard sized cells.

do you trust them in your macbooks and ipads and iphones?

It depends on what the #1 usage of batteries will be.

Utility scale battery usage don't really care about the specifications. We just need a lot of them, cheaply. Shear size can make up for a lot of problems.

But Car batteries are highly sensitive to power, weight, cooling... issues that require innovation and improvement. Its unlikely for any US Car company to buy cheap batteries from China. They'll instead build batteries as a competitive advantage over each other.

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I can't help but think of China's "Great Leap Forward". They believe that Steel is the future, but for large swaths of the country... the best "steel" that China makes is Pig-Iron (an intermediate product before Steel).

https://en.wikipedia.org/wiki/Backyard_furnace

If the "best" Lithium Ion cell that China mass produces has poor weight and/or power density, then it has no use in a Car. Cells and Batteries are the #1 issue for an electric car. (More weight requires more batteries to lug around). Cutting back on weight while increasing the power is how you make a superior vehicle.

> Its unlikely for any US Car company to buy cheap batteries from China. They'll instead build batteries as a competitive advantage over each other.

Just like US processor or SSD companies build things themselves?

I'm being ironic but my point is that when China cranks up production I don't see why US (or any other companies) wouldn't buy their cheap products as long as they meet the required specs.

Edit: Comparing Maoist China to post-Deng Xiaoping China is kind of silly :)

> Just like US processor or SSD companies build things themselves?

China doesn't deliver cheap, high-quality NAND Flash. Nor do they make Intel chips. Nor do they make Qualcomm chips. Nor do they make even AMD chips (I mean sorta, IIRC China has licensed an AMD design but they aren't making Ryzen).

Micron Flash is made in Virginia: https://us.micron.com/micron-in-usa/us-jobs/college-recruiti...

Intel Chips are made in Oregon: http://www.infoworld.com/article/2672745/computer-hardware/i...

AMD Chips are made in New York (Subcontracted to GlobalFoundries): http://www.eetimes.com/document.asp?doc_id=1327435

As far as foreign companies go... Taiwan (TSMC aka Nvidia's contractor), Japan (Toshiba), and Korea (Samsung) are the other countries with 14nm or 10nm fabrication labs. Those are the US's rivals when it comes to high-tech. NOT China. Sorry to burst your bubble.

I think some of those companies build plants in Israel. So Israel deserves an honorable mention. Singapore too.

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Ermmmm... yeah. The best of the best is made in the USA. I'm not saying "China quality is bad"... but the fact of the matter is that China does NOT own any 10nm fabrication facilities.

China's manufacturing is a step behind the USA's technologically. Its a LOT bigger however, so that's a thing. China just has so many damn people that they manage to brute-force a lot of solutions. But unless they begin to push innovative designs, they aren't going to make the best.

Most likely, China's cells will be a shock for the utility-space companies, who DONT require high-quality batteries to do important things. Again, there are plenty of uses of lower-tech MASS PRODUCED cells.

Ex: stick thousands of them into shipping containers and then hook them up to the grid. That's damn useful. Its just not useful for cars.

High end NAND is made in China, but in factories owned by Korean, American, Japanese, and Taiwanese companies.

It's almost like China is still a (huge) developing country! :)

Erm, low-end NAND Flash is made in China. Lots of it, but its low-end.

Intel, Micron, Samsung, and Toshiba are making 3d-NAND, which has superior specifications... allowing controllers to read / write them as Triple-Level without very many endurance problems.

And the only locations for 3d-NAND are:

* Japan: http://www.anandtech.com/show/10184/toshiba-to-build-a-new-f...

* (South) Korea: https://www.engadget.com/2013/08/05/samsung-ships-first-3d-v...

* USA: Idaho for Micron's 3D Flash. IIRC they've partnered with Intel... which is primarily Israel and USA as far as manufacturing goes.

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Now... name me a Chinese manufacturer of 32-layer (or more) 3D Flash. Toshiba hit 96-layers IIRC.

Hint: You can't. China doesn't make high-end 3d NAND Flash. At all. Maybe they will catch-up in a few years, but at the moment, they are not.

The point is that the Gap is narrowing not that there is no Gap.

I'm not sure I'd call 15nm 2D NAND "low end." But when those Chinese fab lines were opened, they were cutting edge.

Nearly all the engineering is done somewhere that isn't in China, which was my point.

I am not aware of any 15nm NAND made by any Chinese companies, correct me if I am wrong.

The parents was right in regards to NAND and Fabs. At least in the next 2 - 4 years time frame. The plan for China, at least up to last year was to bump tens of billions of tax dollar and incentives, along with billions of investment from private sector ( Which isn't really private, but lets not go on with that for now ) to builds Fabs. Since China is now officially the largest Smartphone and electronics market, they want to source more components from domestic market rather then relying on foreign companies. In hope to build an Semi Con Industry that rivals Korea Japan and even US. Hence you see investment into SMIC, and a lot of people were poached from TSMC, Global F and Samsung.

In a typical fashion of Chinese Race to the bottom, they could sell the NAND at BOM cost and gain market shares. I am sceptical whether this works for NAND or Fabs in general. 3D NAND from other companies should have both quality and cost / GB advantage.

Totally agree. Lithium cells, what with their necessary protection circuits and tendency to exothermically disassemble, seem like exactly the sort of product where certain use cases (e.g. EV manufacturers) greatly prefer the premium product with great QA, vs cheap quantity goods.

An 85 kWh lithium fire in a passenger vehicle is a way different beast than a 15 WH phone fire. You do not want to be the car company with the reputation of explody vehicles. Look at "Ford Pinto" - it's basically an eponym for "exploding deathtrap".

Even if these new Chinese batteries are of pristine quality, mass-manufactured Chinese goods inarguably have a reputation to combat.

China is fine for quality (see the iPhone).

Its more about a technology thing. China doesn't have as good of an "innovation" economy yet. I think China has made major steps towards innovating in recent years, but they're still behind US / Japan / Germany / Korea.

>If the "best" Lithium Ion cell that China mass produces has poor weight and/or power density, then it has no use in a Car. Cells and Batteries are the #1 issue for an electric car. (More weight requires more batteries to lug around). Cutting back on weight while increasing the power is how you make a superior vehicle.

FYI most non-Chinese EVs and hybrids with lithium cells use commodity cylindric cells that do have atrociously low weight/capacity ratio

Chinese makers were using purpose built brick cells since around 2012, at the time first generation of Chinese hybrids hit the market

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