Manufacturer in factory overseeing the production

How to stay competitive in future battery manufacturing innovation?

Photographic portrait of Carol Zhao
Carol Zhao

EY-Parthenon Partner, Strategy and Transactions, Energy and Resources, Ernst & Young (China) Advisory-Shenzhen

15 minute read 28 Oct 2022
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Strategy by EY-Parthenon
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Battery players would gain a competitive edge with advanced manufacturing technologies equipped.

In brief

  • Driven by the electrification of automobile industry, the market value of lithium-ion battery would reach RMB3 trillion globally in 2030 with a CAGR of 25.6%. 
  • Due to the rapid capacity expansion and technology innovation, analysing the pain points of lithium-ion battery production process and its solution became crucial.
  • The convergence of cutting-edge technologies has huge positive impact in the lithium-ion battery manufacturing process.

As we look at global renewable energy policies, it is not difficult to find that the transportation sector is currently one of the top three sources of carbon emissions, which comprises 21% of the global emissions, 37% and 31% of the United States and European Union respectively. Global renewable energy policy guides carbon reduction from the transportation sector, while the development of lithium-ion batteries is closely linked to national energy security.

With the support of various governments, new energy vehicles and energy storage are entering the fast lane of rapid development and becoming key driving forces for lithium-ion battery market growth. On our forecasts, the annual sales volume of new energy vehicles is expected to reach 6.37 million in the US, 13.64 million in Europe, and 37.7 million globally by 2030. And installed capacity of electrochemical energy storage is expected to reach 99GW in the US, 48GW in Europe, and 358GW globally by 2030. 

The global cumulative demand for lithium-ion batteries is expected to rise over to 1,515GWh in 2025 and hit 4735GWh in 2030, at a five-year compound growth rate (CAGR) of 25.6%.

Among the top 10 list of global EV battery installed capacity in 2021, Chinese battery companies occupied six seats, accounting for 49% of the global market share, and the remaining four companies are from Japan and South Korea. In fact, regions other than China, Japan and South Korea are currently facing great challenges in building lithium-ion battery production capacity, such as a lack of technological base, weak supply chain support, scarcity of core talents and insufficient plants construction experience. In contrast, the past five years have seen the rapid development of China's lithium-ion battery industry, and the massive expansion in lithium-ion battery production capacity have further enhanced China's dominant position in the global lithium-ion battery industry. Therefore, the development of China's lithium-ion battery industry would largely impact the global trend.

How to achieve the sustainable development of the global lithium-ion batteries to the greatest extent? 

Analysing the pain points faced by the current lithium-ion battery manufacturing process would be the top priority.

Pain points in lithium-ion battery manufacturing 

Our analysis of the pain points would be carried out from the four major stages of the lithium battery process, including the pole pieces stage, the assembly process stage, the capacity grading and formation stage, and the manufacturing process of module/pack stage. 

Download "Ten technical trends of lithium battery"

Analysis on cutting-edge technologies in the production process of lithium-ion batteries, such as the methods of improving production efficiency, application of sensor technologies, digitalization of the production process and application of AI data analysis. 

Read the report

Solution to the pain points

To fundamentally solve the pain points in the lithium-ion battery manufacturing process, improve the consistency in quality, efficiency and cost control, it is also necessary to improve the control accuracy of production equipment and the level of automation in production lines.

Leading lithium-ion battery manufacturing enterprises are devoting themselves to accomplish the incoming technical revolution of battery manufacturing based on their experience accumulated in traditional fields and the persistent investment on emerging technologies. It is widely observed that the convergence of cutting-edge technologies, the integration of existing equipment together with concepts like environmental protection and energy conservation, as well as high speed production are now leading the technical revolution. 

Simulation technology

For the past few years, the manufacturing cycle time of lithium-ion batteries has been drastically reduced with the application of simulation technology in its production process.

The lithium-ion battery is a complex system. Its manufacturing process includes the selection and matching of anode, cathode, electrolyte, separator and other materials, plus the selection of pole piece design parameters. At the same time, the batteries operate with chemical reactions, mass transfer, electrical conduction, heat production and other processes. 

As a supplement to the experiment, simulation technology is well capable of simulating among various schemes and screening out the best. The technique also simulates the charging and discharging process of batteries under different working conditions. Therefore, the advantages of the simulation technology in the production of lithium-ion batteries are remarkable. 

The simulation technology and industrial robots have already been widely adopted by top battery manufacturers.

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Equipment integration

We witnessed that among top Chinese lithium-ion battery equipment manufacturers, R&D investment in equipment integration is universally considerable. It is an inevitable trend to deploy highly automatic and stable lithium-ion battery production equipment. The reasons are as follows: 
 

1. Simplification of equipment

Regarding the EV battery manufacturing, the yield is supposed to be difficult to control if single equipment gets involved in too many production processes, which would therefore lead to the reduction of material utilization and first pass yield. Thus the simplification of equipment is an inevitable trend.
 

2. Production equipment

The current power battery production shows poor front-end process consistency and tremendous gap between production equipment, plus weak cross-industry and intra-industry cooperation, which expedite equipment suppliers to provide a systematically integrated solution.
 

3. Equipment integration

Compared with the traditional individual equipment, the escalation of the front-end process equipment integration would play an essential role in the production pass rate, cost, quality and also space rate, data closed-loop, etc.
 

Laser technology

The application of laser technology in the process of lithium-ion battery manufacturing also brings drastic changes to the production process of lithium-ion batteries.

Laser cutting process is mainly adopted into cutting and forming the battery lug and cutting the pole slice and separator. The laser welding is largely applied onto the moulding of prismatic lithium-ion batteries in automotive aluminum-shell lithium-ion battery industry. There are basically two kinds of welding methods: butt welding and stitch welding. Laser equipment is mainly used in the front-end production, middle-end welding and the back-end module packing.

Meanwhile, the advantages of laser cutting compared with the traditional process are generally reflected in three aspects: 

  1. High-speed on cutting and forming the battery lug with no consumables and stable cutting quality; high design flexibility, suitable for different types and specifications of batteries. 
  2. High efficiency on pole pieces cutting with great process stability. 
  3. High performance in cutting the separator since it’s composed of organic compounds which perfectly suit the process of laser cutting.

Based on this background, the penetration progress of pole piece laser cutting technique is continuously accelerated. The cutting volume of batter lug and pole piece is expected to increase with the diffusion of laser stacking technique, and the application of laser in lithium-ion battery manufacturing would be further enhanced.

The future application fields of laser technology are mainly 3D galvanometer flight welding, side welding of cap and cleaning of thinning zone of cathode.

Overall, the current trend of pole piece cutting technology is increasingly higher cutting speed and higher quality requirements. In addition, the requirements for cutting process on anode coating material composition and density changes, non-metallic material sandwich structure and other new design are escalating as well. The continuous improvement of EV battery performance forces the upgrade of intelligent manufacturing of lithium-ion battery equipment, which generates more strict requirements on photoelectric conversion efficiency and energy saving capacity for laser equipment.

Vision technology

In the process of lithium-ion battery manufacturing, vision technology is noteworthy to achieve the PPB (parts per billion) defective rate requirement. How to quickly conduct a quality check on each production stage of lithium-ion battery manufacturing and realize high-efficient production? 

Machine vision changes the production mechanism of lithium-ion batteries with high detection efficiency, accuracy and stability, which has become the standard configuration in the production and assembly of lithium-ion batteries.

At present, for the separating, coating, rolling, slitting, die-cutting, stacking and other processes in the production of lithium-ion batteries, the major machine vision suppliers provide size detection, alignment detection, appearance defect detection, position correction and closed-loop control and other solutions respectively. In each detection step, almost all suppliers adopt the latest technology or advanced algorithm that inevitably based on one of the four underlying technologies of visual application, which are recognition, measurement, positioning and detection.

Energy saving management

The high energy consumption problem in the production of lithium-ion batteries is still prominent.

At present, about
energy consumption is required to produce 1KWh lithium-ion battery pack

Today, the energy efficiency of lithium-ion battery manufacturers is relatively low. Massive heat is released during the production process, which causes huge waste and has various drawbacks. Therefore, the application of environmental protection and energy saving technologies in the production of lithium-ion batteries is particularly critical.

Currently, almost all leading lithium-ion battery manufacturers in China have installed NMP material recovery systems on their production lines to achieve the goals of recovery, purification and reuse of NMP. Through the material recovery system, the recycling of resources in the manufacturing process of lithium-ion batteries is realized, which would not only meet the national environmental protection requirements, but also greatly reduce the production cost of batteries.

We estimate that the energy consumption required to produce 1kWh lithium-ion battery pack would drop steadily to less than 30kWh in 2030. With the application of environmental protection and energy saving technologies, the energy consumption required for future lithium-ion battery production would be significantly reduced, which would lead to lower pollution and lower energy consumption in the lithium-ion battery production process.

Solid-state batteries technology

The technology of EV batteries has evolved by leaps and bounds in the past decade, but safety issues and mileage anxiety still exist for electric vehicle buyers. At the same time, solid-state batteries have become the new craze in the industry amid controversy and skepticism, and the future potential of solid-state batteries is becoming clear as various market leaders enter the market.

Compared with liquid batteries, the advantages of solid-state batteries are higher safety performance and higher energy density. Therefore, among the numerous researches on battery technologies, solid-state batteries have received extensive attentions worldwide. Leading companies have invested a large amount of money in solid-state battery R&D. 

At present, the research and development of solid-state battery technologies has been pushed to the forefront. As of September 2022, 56 enterprises have been developing solid-state batteries globally. The solid-state batteries are expected to enter the market in small batches from 2025, which would become a winning tool for electric vehicles to replace fuel vehicles. In terms of market demand, it is predicted that the global demand for solid-state batteries is expected to exceed 500GWh by 2030.

Market value would exceed
according to the conservative estimate by Chinese industry experts

The future technical trends of semi-solid and solid-state batteries would be dry electrode technique, hot metal cladding technique and intelligent manufacturing, which would hopefully completely solve the current safety problems of liquid batteries.

Summary

Through multiple visits, surveys and opinions of senior experts in the industry, we sorted out the pain points and technical trends in the manufacturing process of lithium-ion batteries. If you would like to know more about the topic, you can download the report of "Ten technical trends of lithium battery". In the future, we will continue to conduct in-depth research on this topic. At the same time, we would like to express our gratitude to Da Dong Times Database (TD), Guangdong Lyric Robot Automation Co., Ltd. and Shenzhen Geesun Intelligent Technology Co., Ltd. for their valuable opinions and great help.

About this article

Photographic portrait of Carol Zhao
Carol Zhao
EY-Parthenon Partner, Strategy and Transactions, Energy and Resources, Ernst & Young (China) Advisory-Shenzhen
Specializes in new energy, advanced manufacturing, advanced materials and fine chemical industry. Dedicated to meeting diversified clients’ needs through effective one-stop services.
Related topics
Strategy by EY-Parthenon
Energy and resources
Technology

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