Switched on cars

C&I Issue 9, 2009

Governments across the world are pouring huge sums of money into the development of technologies for green cars with the aim of making automobiles more energy efficient. However, chemicals and materials producers that supply the car industry may find themselves pushed to the sidelines in the scramble to grab some of the additional R&D cash. Instead, much of the money will probably go to the car manufacturers themselves and their leading - Tier 1 - suppliers that make key vehicle components.


‘The automotive industry is highly price competitive so companies involved in green car developments will try to benefit from the additional government funds directly themselves before sharing them with other parties,’ explains Michael Reiser, general manager at Asamer Basaltic Fibers, Ohlsdorf, Austria, a producer of a new basaltbased fibre for lightweight cars.


‘We might have a problem getting a piece of the cake as the car makers and their top tier suppliers have a much stronger position in the market compared to a relatively new player like ourselves,’ he continues.


In the longer term, some chemical companies – particularly producers of composite lightweight materials – may find the only way they can gain from the extra cash is through a rise in demand for their products as a result of work done by the government-supported R&D initiatives.


‘Few producers of composite materials are likely to benefit directly,’ says Robert Eller, president of Robert Eller Associates, an auto materials consultancy at Akron, Ohio. ‘A lot of money will be going to developers of new sources of energy. The development of lightweight structures for cars is more of a long-term, secondary consideration.’


The challenge for materials and chemicals producers will be to establish ways of gaining access to public sector funds through R&D partnerships with automobile manufacturers and engineering companies and research consortia for the development of green transportation technologies. Some chemical companies have materials that can be used in lithium-ion (Li-ion) batteries and fuel cells – the main new clean energy technologies in transportation – as well as elsewhere in automobiles.


SGL Carbon of Germany, a specialist in carbonbased products, is one of the few makers of composites whose materials are benefiting from government money going into development of batteries, fuel cells and lightweight systems.


‘[We’re] engaged in governmental funded projects to develop process technologies and materials for lightweight composite structures as well as projects to develop fuel cell gas diffusion layers and carbon components for Li-ion batteries,’ says an SGL spokesperson.


The push for more energy efficient cars will offer massive opportunities to chemical companies with green technologies. It will also provide openings for chemical producers who do not have much of a presence in the automobile sector because the switch to low or zero carbon energy vehicles, as well as the impact of the recession, could trigger a restructuring of the whole car industry.


A large proportion of the additional public sector money will be allocated to the development of electric vehicles (EVs) in the expectation that they have the best prospects for reducing CO2 emissions from transportation, which accounts for a third of all carbon dioxide emissions worldwide. At present, EVs, including hybrids using a mixture of battery power and gasoline or diesel fuels and to a lesser extent those powered by fuel cells, make up only 1% of annual global automobile sales of around 90m vehicles.


By 2020 the EV share is predicted to be as high as 20%, primarily because of a surge in demand for hybrids. Renault, the French car company which partly owns Nissan of Japan, is forecasting that in the French car market a fifth of French cars could be electric by 2016.


Among chemical companies, the main beneficiaries of this large shift into electric energy in transportation will be the makers of materials for a range of batteries, in particular those made from lithium-ion. With hydrogen fuel cells, another big potential source of electricity in vehicles, they will also be providing catalysts in addition to materials.


The providers of the public sector money for green, predominantly EV, technologies extend from municipalities and regional authorities and agencies through to central governments and the European Union. The EU has established a development fund called the European Clean Transport Facility (ECTF), which is making €4bn available annually for four years to 2012 for low or zero carbon projects.


In the UK, the government has recently announced plans to offer subsidies of up to £5000 to encourage motorists to buy electric or plug-in hybrid cars – expected to be available from 2011. The move is part of a £250m initiative to promote low carbon transport over the next five years, including £20m to be spent on improved electric charging infrastructure. Less than 0.1% of the UK’s 26m cars is currently electric.


In the US, funds for clean energy technologies have been available under a $25bn Advanced Technology Vehicle Manufacturing (ATVM) programme introduced two years ago. President Barack Obama then announced in March 2009 an allocation of $2.4bn for the development of hybrid EV batteries and their components, as well as electric motors.


Through a range of tax incentives and other measures, including R&D grants, the Japanese government has been encouraging the development of automobile batteries in Japan since the 1990s. The country now dominates the global market for nickel metal hydride (NiMH) batteries, currently the main source of electric power in hybrid vehicles, and is already well ahead in the development of Li-ion batteries.


The Chinese government is aiming to use consumer subsidies of $8000/EV and large R&D grants to help China become one of the world’s leading manufacturers of electric vehicles within three years. Its target is to raise output of EVs from 2100 in 2008 to 500,000 by the end of 2011.


In fact the massive rise in handouts of R&D money for EV development by the US and the EU is seen as not only an effort to curb global warming but also a step towards greater energy security. Neither wants to switch from dependence on Middle East oil to reliance on batteries developed and manufactured in Asia.


In the US, Ener1 in Indianapolis is the only major lithium-ion battery producer with manufacturing capacity in the country. Its main domestic competitor, A123Systems in Massachusetts, has revealed plans to build a Li-ion battery plant in Michigan with the help of US government loans of $1.8bn so that it can stop using a Chinese contract manufacturer for much of its output.


However Li-ion batteries will not make big inroads into the auto battery market without substantial reductions in costs, which will require breakthroughs in the development of new materials. Currently, a high capacity lithium-ion battery for automobiles costs around $20,000.


Li-ion batteries are widely used in mobile phones and laptop computers because their energy output/kg is two to three times higher than that of conventional batteries. Their energy density or storage capacity is twice as high as in NiMH batteries. But in automobiles Li-ion batteries can overheat when used with existing materials such as cobalt-oxide and related oxides. Much of their high cost is due to the need to develop safer materials.


‘Improvements can be made in all material classes (in Li-ion batteries for autos) and especially in the combination of new materials,’ says Phillip Hanefeld, senior manager for batteries at BASF Future Business in Ludwigshafen, Germany, which is in involved in a US government-funded project for optimising the production process for low-cost Li-ion battery cathode materials.


BASF is also a leading participant in HE-Lion, a development consortium funded by the German government, which aims to commercialise higherperforming and safer Liion batteries for cars in the next four to six years. A key objective will be to provide a battery with sufficient energy density to drive a reasonablypriced four-seater car 200km without a recharge.


‘The main problem of today’s batteries for EVs is energy density,’ says Hanefeld. ‘The HE-Lion partners will try to optimise all materials with regard to energy density, safety and costs.’


Li-ion battery makers are seeking to improve the energy density by around 50% in the next few years with the help of more efficient electrode materials such as manganese, phosphates, ferrous materials and titanium. A123 has, for example, developed a nanophosphate electrode material whose combination of low resistance and high energy discharge rate.


In partnership with German car maker Daimler, Evonik is developing lithium-ion batteries with a thin ceramic-coated separator between electrodes to prevent overheating. With electrolytes, companies are testing liquid organic solvents polymers and gels.

However, the battery sector is not concentrating exclusively on developing Li-ion technologies. Some companies believe that considerable improvements can still be made to NiMH batteries. High performing versions of the long-established lead acid battery are now being used in microhybrid systems for engine start-restarts, which can reduce energy consumption by up to 8%.


Think Global, a Norwegian based EV manufacturer, is offering in its vehicles, in addition to Li-ion batteries, a molten salt battery made by Mes-Dea of Switzerland with two basic materials: sodium and nickel. The battery has operating temperatures of around 250–330ºC to provide a molten salt of high conductivity and hence high energy density.


‘With these batteries for automobiles the cost is not in the materials but in the time and expertise required to develop them,’ explains Katinka von der Lippe, head of design and product planning at Think Global.


In the fuel cell sector, UK-based Bac2 has developed a conductive composite polymer called ElectroPhen from low-cost bulk raw materials making scale-up to mass production relatively easy and economical. The composite is being used for bipolar plates in fuel cells but the company believes it can be applied in electrical or electronic products possibly elsewhere in automobiles.


The era of clean energy automobiles will provide openings for companies with innovative materials for components throughout the car, particularly because there will be new players in the sector. A big gain in market share by EVs is likely to precipitate changes in the auto supply chain. Makers of key components like batteries are already manufacturing electric vehicles themselves. There will be opportunities to create ties with new global players in the car market.

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