Daimler Invests To Triple Its Lithium-Ion Battery Production

1 year ago by Steven Loveday 31

Deutsche ACCUmotive Battery Factory

Deutsche ACCUmotive Battery Factory

Battery developer, Deutsche ACCUMOTIVE, a subsidiary of Daimler AG, will triple its battery production through the addition of a second factory in Germany.

Daimler CEO, Dieter Zetsche, explains:

Mercedes-Benz Energy Storage, Deutsche ACCUMOTIVE

Mercedes-Benz Energy Storage, Deutsche ACCUMOTIVE

“To get closer to fully electric driving, we keep investing big in the key component of emission-free vehicles: powerful batteries. We are now devoting another 500 million Euros to build a second battery factory in Germany. This underlines our commitment to the consistent expansion of electromobility.”

The new factory will produce batteries for Mercedes-Benz and smart. Daimler has already acquired additional land near the existing factory. Groundbreaking is set for Fall of 2016 with plans for full operations in place by summer 2017.

Harald Kröger, Head of Development Electrics/Electronics and e-Drive Mercedes-Benz Cars said:

“With the purchase of the new land, our production area at the site will be tripled. The previous 20,000 square meters will be stocked up by an additional 40,000 square meters of production space. We will expand the production capacity consistently in the coming years.”

Demand is ever-increasing for lithium-ion batteries as electrified vehicle production grows. Deutsche is also expanding its opportunities and market into battery storage for private and industrial use.

Deutsche ACCUMOTIVE was founded in 2009 and currently employs over 380 people. Since 2012, the company has delivered over 70,000 batteries.

Interestingly enough, news changes quickly, as Zetsche publicly announced very recently that he was unwilling to invest in increased battery production in Germany:

“There is de facto a massive overcapacity in the market today and cells have become a commodity. The dumbest thing we could do is to add to that overcapacity.”

Possibly Zetsche just didn’t want to share what was going on behind the scenes at Daimler . . .

Source: Daimler

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31 responses to "Daimler Invests To Triple Its Lithium-Ion Battery Production"

  1. Alaa says:

    The picture shows a small part of the factory I assume. But compare it to the Giga Factory! It is tiny. But we need as many factories as we can to get rid of oil. So Bravo to them.

  2. Pushmi-Pullyu says:

    Hats off to Daimler.

    The next time I post a list of the EV makers which are wisely investing in their own battery factories, I’ll have to remember to include Daimler. Hopefully this will be a growing trend.

    That quote about battery “oversupply” was just bizarre. Perhaps there is an oversupply in cells for consumer electronics, but certainly not in the EV supply market. Perhaps, as this article seems to suggest, that quote was deliberate disinformation.

    1. GeorgeS says:

      @PMPU

      I’d like to see the numbers for existing battery manufacturing capacity and planned on a per country basis.

      With LG and all their factories it would not surprise me if there WAS overcapacity. then of course one would have to extrapolate what future demand was.

      Sounds like a good article. Hey Jay why don’t you have ur staff get working on that 🙂

      1. jerryd says:

        George, on the contrary LG doesn’t have enough factories to handle demand.
        And can’t handle anymore demand for 2+ yrs it’ll take to make more factories, lithium refineries.
        As for Daimler they are likely assembling battery packs, not making cells.
        No car company in modern times has ever made good EV battery cells.
        They have tried many times.
        Tesla doesn’t count as they were a battery maker first and built the EV’s for a market for them, their other EV drivetrain, computer, etc products they couldn’t get others to buy, build EV’s with so they went vertical.

        1. Braben says:

          Huh? Tesla doesn’t make battery cells either.

          1. Three Electrics says:

            The Gigafactory will produce cells.

            1. Braben says:

              Yes, but that is not what the poster said.

              Also, from what I understand, the cells will still be made by Panasonic in the “gigafactory”, just that they are colocated with pack assembly.

          2. jerryd says:

            Braben, Tesla’s patented cells are contracted to Panasonic to produce.
            But they are Tesla’s multiple patented design no one else can use without Tesla’s OK.
            Not even Panasonic that have their own designs.

        2. Pushmi-Pullyu says:

          jerryd said:

          “Tesla doesn’t count as they were a battery maker first and built the EV’s for a market for them…”

          Ummm… no. Not even remotely. Tesla has never made battery cells, altho of course they are partnering with Panasonic to build the Gigafactory, which will soon start producing li-ion battery cells, if it’s not already.

          Quoting from “What Goes Into A Tesla Model S Battery–And What It May Cost”

          ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
          In contrast to every other automaker, which use specialized large format Li-Ion cells, Tesla’s battery pack is made up of thousands of inexpensive commodity cells similar to those found in laptops.

          Unlike automotive cells, these cells are produced in the billions, subject to the fierce competitive pressures that are a signature characteristic of the computer and consumer electronics industries.
          ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

          Full article: http://www.greencarreports.com/news/1084682_what-goes-into-a-tesla-model-s-battery–and-what-it-may-cost

          1. jerryd says:

            Again PP they are Tesla’s patent cells. Panasonic just is contracted to make them.

      2. Pushmi-Pullyu says:

        GeorgeS said:

        “With LG and all their factories it would not surprise me if there WAS overcapacity.”

        Well, to argue your side of this debate, I think Jay Cole did post the other day that LG’s current construction of new battery factories has more to do with currency exchange rates than demand. However, with LG Chem announcing new customers every few weeks, I feel confident in saying that they do need to ramp up their production to meet rapidly increasing demand.

        Let’s also keep in mind that the planned production capacity of the Gigafactory is equal to the entire world’s production in 2013! What happens when some auto maker other than Tesla decides to make 400,000+ long-range BEVs per year?

        If there is currently an oversupply, and I submit there isn’t much evidence there is one, then (a) the battery oversupply isn’t in the EV battery market; it’s in the consumer electronics market, and (b) assuming factories producing those batteries can be reconfigured to produce EV batteries, then that oversupply is not going to last long!

        Bottom line: The number of auto makers offering 200+ mile BEVs is going to keep increasing in the coming years. Therefore, the demand for EV batteries is also going to increase, and it’s going to increase quite rapidly.

  3. Pushmi-Pullyu says:

    Oops… managed to mess up my “Name” field.

    1. sven says:

      Are you and RexxSee the same person? Is he your alter ego or just one of your split personalities? That would certainly explain a lot. 😉

      1. sven says:

        It all makes sense now. RexxSee if the other head of the two-headed llama. 😉

        1. Pushmi-Pullyu says:

          You realize, of course, that since you figured out my secret, I have to kill you.

          1. Jay Cole says:

            /fixed your name ID…no copy and pasting in that box, (=

            1. Pushmi-Pullyu says:

              Thanks for fixing that, Jay!

              Yes, you correctly identified my error. Mea culpa.

  4. ModernMarvelFan says:

    3x of a very small number is still a small number.

  5. Mr X says:

    Details make the difference.
    Deutsche Accumotive does not produce cells but batteries.
    According to greencarreports Tesla and Panasonic have invested 374 Million USD in the Gigafactory by the end of 2015. They need to invest 3.5 billion USD after 10 years to not have to pay back all tax credits (some 1.25 million USD).
    I dont know the investment into Deutsche accumotive. One can assume that doubling the production space and “devoting another 500 Million Euros” gives a hint that in 2017 Deutsche Accumotive is worth 1 billion Euros (approx 1.1 billion USD).
    And this is only for battery production. Cells seem to be sourced from Asia.
    In that context the Gigafactory is similar in size to this company, and possibly to other similar companies that aren’t in the headlines all the time.

    1. Braben says:

      Exactly. I don’t know why people don’t seem to understand this. Deutsche Accumotive builds battery packs and control modules (and is also involved in research activities), but the cells are sourced from companies like LG Chem.

  6. MrX says:

    Li-Tec was the company Zetsche referred to – and that’s the company that Zetsche move out of re investments.

    1. MrX says:

      Li-Tec produced cells not batteries like Deutsche Accumotive.

  7. SJC says:

    It is obvious that an automaker that makes its own batteries could be at an advantage.

    1. MikeG says:

      I think it is critical that automakers can take those cell improvements and make robust battery packs.

      The automakers should let the battery manufacturers specialize on cell improvements.

      Automakers must continue improving their pack design with knowledge gained from the battery packs in the field and new cells available from the battery cell manufacturers.

    2. theflew says:

      They could also be at a disadvantage to respond to changing chemistries, formats and price pressures.

      1. Pushmi-Pullyu says:

        That’s true, but an EV maker that makes its own battery cells controls its own supply. Those which don’t, are limited in production by a third party which they don’t control.

        That’s why Nissan and Tesla have partnered with battery cell makers to build their own battery factories. BYD also has its own battery factories. Nissan, Tesla and BYD are the only EV makers who can build as many EVs as they want to.

        * * * * *

        I find it rather strange that a few people posting comments to InsidEVs suggest that Tesla’s production constraint due to limited batteries is some sort of propaganda or public relations spin. Do they also think Nissan’s limited production of the Leaf, before they build battery factories in Tennessee and the UK, was also just propaganda? And do they really think Tesla would be building a $5 billion battery Gigafactory if it could buy as many battery cells as it needs in the commodity market?

        Make no mistake: The production limit imposed by EV battery supply is very real.

        1. Braben says:

          Personally, I believe Zetsche when he says there’s an oversupply. LiIon batteries are relatively old technology and their production is well understood. Once demand rises, it quickly turns into a commodity business.

          If Tesla is limited by battery production, why are they introducing additional battery-consuming products like the Powerwall rather then using the batteries for their core product?

          Regarding the “gigafactory”, this is a high-risk bet on the future. It is far from certain if it will ever be fully built out. It all depends on whether the market will develop as Tesla (and we) hope. It could either turn out to be a competitive advantage or an expensive albatross around their neck.

          1. SJC says:

            This is why I posted “could” have an advantage, it depends on how they manage it.

        2. Three Electrics says:

          Tesla’s battery supply problems were financial: because Tesla had few assets, they couldn’t colleralize a promise to buy batteries that a manufacturer could take to the bank. Thus, Panasonic did not invest to increase supply ahead of demand. So, in an era of cheap money, Tesla raised cash for their own factory–capex, which hurts earnings less–but even now Panasonic has said, “We are sort of waiting on the demand from Tesla.” So it’s the same old story, but at larger scale.

        3. Three Electrics says:

          Nissan’s battery factories have proven to be a disaster–outclassed at every turn by LG Chem, who have much better economies of scale. They may well end up being a waste of money. Nissan did have battery supply issues, but only because they didn’t believe there was sufficient demand to invest in additional capacity; with US EV sales down this year, that is proving to be a wise move.

          Nissan does not make their own steel or tires; it makes no sense. Why should the situation be any different for cells?

  8. Romboiii says:

    The “news changes quickly” part of the post suggests a mind change, which I cannot see. Zetsche was referring to overcapacity in cells, Accumotive is a pack plant.