Lux Research: Buying Spree Of Battery Startups Expected
Investments in battery start-ups are (like in the case of most start-ups) risky. The recent acquisition of Seeo by Bosch convinced Lux Research to post a blog article.
Seeo is developing solid-state batteries with high energy density and Bosch believes that Seeo’s IP and research staff will succeed in producing its own battery cells.
Lux Research monitors the whole industry, including not only large manufacturers but also start-ups and, as it turns out, a bunch of them already were classified in the “Caution” category. Even Sakti3.
Here is Lux Research’s insights into Bosch’s risky bet:
- Bosch’s acquisition of Seeo (see the full Lux profile of Seeo here — client registration required) comes at a crucial time for the fragile startup. Seeo has been trying to pivot from lower-energy LFP (lithium iron phosphate) cathodes towards higher-energy NCA (nickel cobalt aluminum) cathodes to keep ahead of the competition. It was also looking to set up joint ventures to help it scale up production of cells capable of 350 Wh/kg, a crucial step in proving its new technology. However, its high appetite for burning through cash, its unproven cost claims, and technical issues like low ionic conductivity (which limit power and require the battery be heated to about 80 °C) place it mid-pack in our Lux Innovation Grid of interviewed solid-state battery developers:
- Bosch is taking a risk on a mid-pack player, but if the acquisition price was low enough (terms were undisclosed) it was a move worth making. Seeo’s technology will require quite a bit more investment and time before it is ready for a commercial debut. Nonetheless, the buy is an almost necessary one for a supplier like Bosch that has ambitions to be a key battery player in a crowded, competitive space that our recent report, Watch the Throne: How LG Chem and Others Can Take Panasonic’s EV Battery Crown by 2020 details (client registration required). As Bosch’s CEO commented earlier this year, the supplier is hoping its batteries reach the 300 Wh/kg to 400 Wh/kg mark by 2020, and that at the same time costs fall by 50% in that timeframe. Such ambitions are well-matched to taking a risk on next-generation batteries beyond lithium-ion (Li-ion), like Seeo’s.
- As our Lux Innovation Grid shows, there remain some intriguing companies in this solid-state space that present better targets for partnerships or acquisition than Seeo – like Imprint Energy, Ilika, and ProLogium on the start-up front, and Hydro-Quebec’s IREQ arm on the industrial laboratory front. While all of these players have their own associated strengths and weaknesses, it does mean that the next-generation solid-state battery space remains open, despite starting to heat up. In addition to Bosch buying Seeo, Apple is rumored to have quietly acquired distressed thin-film battery developer Infinite Power Solutions at the end of 2014 (not to mention GM’s investments into Sakti3 and SolidEnergy, and VW investing into Quantumscape and working with Oxis Energy, two other beyond-Li-ion players).
So, a lot of large companies investing in battery start-ups are trying to seize an opportunity. A big part of those companies probably will fail, but some have a chance at succeeding.
Source: Lux Research