LG Chem Signs Next-Gen Battery Contract With Audi Worth “Hundreds Of Millions”

3 years ago by Eric Loveday 35

This Audi Concept Hints at the 2017 Production Q8 - Rumor Has It That An Electric Version With Up to 370 Miles of Range is Under Development

This Audi Concept Hints at the 2017 Production Q8 – Rumor Has It That An Electric Version With Up to 370 Miles of Range is Under Development

NEWSFLASH: Audi bets BIG on the future of plug-in vehicles with massive battery contract deal with LG Chem.

There’s now no way that the Audi naysayers can continue to state that the German automaker isn’t committed to plug-in vehicles.  “Hundreds of millions of dollars” invested into a battery deal with LG Chem solidifies Audi’s commitment to future plug-ins.

Per Reuters:

“South Korea’s LG Chem said on Wednesday it had won an order from Audi to supply batteries for its plug-in hybrid and micro hybrid electric vehicles.”

“LG Chem said the deal was “worth hundreds of millions of dollars” but declined to give further details. It said it expected to win more such orders from Audi parent Volkswagen AG in the future.”

Audi’s future product outlook shows almost nothing in the way of micro hybrid electric vehicles in the coming years, so let’s assume that the vast majority of this contract is for plug-hybrid and/or pure electric vehicles.

Reuters adds:

“LG Chem, which has secured a total of 20 customers including General Motors,…aims to achieve combined sales of over 10 trillion Korean won ($9.8 billion) from large-sized batteries by 2018.”

It’s being reported elsewhere that this Audi/LG Chem contract is solely for next-generation battery tech.

Currently, Volkswagen relies heavily on Panasonic for battery cells to power its plug-in vehicles.

Could it be that Audi is the unnamed automaker that will get LG Chem’s next-gen 200-mile battery in 2016?

Source: Reuters

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35 responses to "LG Chem Signs Next-Gen Battery Contract With Audi Worth “Hundreds Of Millions”"

  1. kdawg says:

    Is it time for LG to build a Gigafactory?

    1. GeorgeS says:

      Whether they do or not it appears that LG and Panasonic/Tesla will be two big takers of the market.

      This is good news for GM. They got this whole thing going with the Volt.

      Also this should make some good competition between prismatic cells (LG) and cylindrical cells (Tesla).

      (I sure hope GM’s 200 mile EV isn’t a modified sonic though.)

      1. Dr. Kenneth Noisewater says:

        I bet it will be, and I bet it will only be sold in California because 200+mi range cars get more CARB credits than <100mi range. Still, they get to sell a high-margin Yukon Denali to a Fontucky house flipper as a 'work' truck, so it's all good.

        Incidentally, I won't be holding my breath for Audi's "EVs". I doubt LG will have a cost or density advantage with their proprietary prismatics that can't be met or bettered by "open" 18650s, but I wouldn't mind being proved wrong if it means lower costs and higher densities.

        1. GeorgeS says:

          “Still, they get to sell a high-margin Yukon Denali to a Fontucky house flipper as a ‘work’ truck, so it’s all good.”

          LOL good one.

          Another version of “carbon offsets” only they’re offsetting in the wrong direction.

    2. Spec9 says:

      I hope so . . . with Audi & GM, they could sure sell a lot of batteries . . . especially with the new cheaper Volt and the 200 mile EV. And start selling the damn Spark EV in more places . . . it is a very cute little EV.

  2. kdawg says:

    “Could it be that Audi is the unnamed automaker that will get LG Chem’s next-gen 200-mile battery in 2016?”
    ———-
    Only if it’s a PHEV. The chart shows the BEV is to be from a US OEM.

    1. Mr. M says:

      The chart was inserted by insideevs. They suposed it will be a america company and so they inserted sheets of EVs for America. But Renault also anounced Battery improvement for Zoe. Maybe its renault, that is using LGChem cells.

      1. DaveMart says:

        Exactly right.
        LG Chem and Renault are jointly developing this battery, it is not just a contract to buy:
        http://www.industryweek.com/technology/renault-lg-chem-develop-batteries-electric-cars

  3. Taser54 says:

    Well, that’s two major manufacturers that think LG has made a breakthrough.

    1. DonC says:

      Not necessarily a breakthrough. More likely reliability. Just look at the difference in the battery degradation in the Leaf and the Volt.

  4. Josh says:

    This is great news. Does LG have production in EU?

    1. Aaron says:

      They have a site in Poland.

      1. GameChanger says:

        It’s not for battery.
        They have 3 sites, Korea, US, and China.

  5. DaveMart says:

    I’m not sure what is going on.
    VW uses the Panasonic NMC batteries in their E-Golf.
    It looks as though they may be using those for the big packs in BEVs, and LG for the smaller, faster cycling packs in PHEVs.

    Unless of course Audi are going one way and the rest of the VW group another, but that does not sound like what is happening from the announcement, where LG are hopeful of being selected for the entire group.

  6. David Murray says:

    Sorry, but can somebody tell me what a “microhybrid” is?

    1. Aaron says:

      I’ll bet it’s a hybrid with a tiny battery pack. I can’t imagine how effective a microhybrid would be if the battery pack is smaller than, say, a Prius.

    2. Josh says:

      I think “micro hybrid” is also referred to start/stop technology. http://en.wikipedia.org/wiki/Start-stop_system

    3. kdawg says:

      Or possibly GM’s E-assist vehicles

    4. It’s where the electric motor is much smaller than the ICE. Some systems are using the alternator as motor, typical in the range 10-20 kW.

  7. Benz says:

    This is really good news. More Plug-In Hybrid EV’s and BEV’s will be revealed. That’s exactly what needs to happen.

  8. Aaron says:

    “There’s now no way that the Audi naysayers can continue to state that the German automaker isn’t committed to plug-in vehicles.”

    We “naysayers” were more concerned about the level of commitment. Even a $500 million contract, at $10,000 per pack, is only 50,000 vehicles. That’s a good start, but I want to see actual vehicles before I stop being a “naysayer”.

    1. Priusmaniac says:

      Yes if that means getting into hybrids or limited range sub 80 miles plug-in hybrids or just some limited range golf EV, that can’t be taken as real commitment to EV driving.

  9. pjwood says:

    LG Chem is too smart to say “micro-hybrid”, and get it wrong unless it was on purpose. Isn’t that the 48v tech, that news came and went about? Maybe Audi is, indeed, going to go with this system, but doesn’t it just marginally improve upon E-assist and stop/start? This isn’t even the benefits of regular hybrid, in a world that is leap-frogging that, with PHEV.

    Micro-hybrid isn’t about storage. Typical hybrids are in the 1kwh ballpark, and we’re talking about substantially lower voltage. I believe the thinking, at one time, was to get the entire 12V bus over to 48v, which is a better means to achieve regeneration than 12V could ever have been. But, again, it was so incremental (pursued for a time by Johnson Controls) that I think Audi will just cement themselves into a deficit, if LG Chem is correct.

    I think its more likely these are large format cells, that at the very least will be in the hundreds of Volts, for full-on electric drive. I may have “micro-hybrid” all wrong, but thought it would have had to really take off to make second/third tier providers switch away, or co-produce all their 12v ancillaries next to 48v ones.

    1. GeorgeS says:

      ” I may have “micro-hybrid” all wrong”

      I think you have it about right.

      If every conventional ICE car went to micro hybrid I can see it working.

      However I don’t think consumers are willing to put up much, if anything, for the system.

    2. DaveMart says:

      Micro hybrid or stop start is really taking off in Europe, as legislation makes it a virtual necessity to get anywhere near emission targets.

      My courtesy car loaner, a little Fiat, had it.
      I wondered what on earth was going on when it cut out at the traffic lights, as the garage had not told me!

      A switch to 48V does even more.
      This is not just Europe, as the Europeans and Chinese work on standards very closely together.

      Audi is big in both markets, and has chosen this means of hitting its targets.

  10. Rob Stark says:

    The press release says the batteries are for PHEV and micro hybrids but you choose to ignore it and say the batteries are for BEVs and on top of that call out Audi naysayers? Really?

    As noted all automakers will have to go to at least micro hybrids across the product range to meet EU emission targets.

  11. ModernMarvelFan says:

    Let us assume at 10KWh per car and $3000 per car. “hundreds of millions” is only 33K to 300K cars at most..

    If it is 50KWh, then at $10K per car (assume more discount), then that is only 10K to 99K cars total.

    Is that per year or total deal over few years?

    Either way, it doesn’t sound like a whole lot deal…

    1. DaveMart says:

      For micro hybrids you are talking of the order of 300Wh to recapture braking energy and to re-start.

      For Audi’s plug ins you are talking about 9.7kwh.

      Don’t read off the prices from the price of batteries for BEVs though, as the smaller the battery and the higher cycling it is the more it costs per kwh.

      Most cars in Europe, and presumably China too, as they co-ordinate with us for regulations, will be at least micro hybrids though within a very few years, so you are talking about gradually going to all of Audi’s productions for those markets, and likely elsewhere too.

      Add on maybe up to 10% of Audi’s being PHEVs, and that is a lot of batteries.

  12. evnow says:

    ‘“Hundreds of millions of dollars” invested into a battery deal with LG Chem solidifies Audi’s commitment to future plug-ins.’

    Is this over 20 years ?

  13. Anthony says:

    If we assume the dollar figure is in the $500M range, at $250 kWh, that’s 2M kWh. That’s enough for 33,000 60kWh EVs or 1.3M 1.5 kWh micro hybrids.

    1. DaveMart says:

      Batteries for micro hybrids and PHEVs aren’t $250kwh nor anything like it.

      That is batteries for BEVs, and that is pushing it as Nissan say they are losing money on the $270 kwh replacement pack.

      Think double your price minimum, more for micro.

      1. pjwood says:

        Very insightful, Dave. Thanks. Whether .3kwh (at perhaps $500/kwh), 9.7kwh, or 60kwh, “hundreds of millions” get spent pretty easily, when you consider the micro-hybrid unit sales they’re probably forecasting. It won’t make sense do anything but swing for the fences, if this means re-designing a/c units, motors, light bulbs(?), etc. I’m curious how much engineers see 48v as the lowest hanging fruit of kinetic energy recovery?

  14. Peter says:

    Ok were are there superchargers located?
    Are they free of charge?

    No and no. Ok