Overcoming material, components shortages through EV design

14 September 2022
Source: Gorodenkoff/Adobe Stock

Between global trade tensions, lingering effects of the COVID-19 pandemic and a devastating war in east Europe, the global supply chain is in significant disarray. After nurturing a robust supply chain for decades, the automotive industry has been left reeling amidst strategic material shortages and rising commodity prices.

To exacerbate the problem, many of the shortages have hit electric vehicle (EV) production just as the industry begins to pivot away from fossil-fueled transport. With global sales of EVs having increased by 80% in 2021, the International Energy Agency (IEA) expects the number of electric cars, buses, vans and heavy trucks on the world’s roads to grow to 145 million by 2030.

Supply and demand for critical EV materials

To support this growth, carmakers will need an ever-increasing supply of lithium-ion batteries (LiBs), motors and electric components to satisfy the market. However, with analysts such as the IEA predicting a 30-fold increase in demand for minerals by 2040 there is a strong possibility that there will be a shortage of nickel and cobalt, accompanied by challenges in scaling up lithium production.

To mitigate the risks, EV manufacturers are adopting innovative supply chain strategies. Tesla, for instance, is negotiating directly with mining companies to secure the supply of raw materials, while Volkswagen has signed an MOU to acquire stakes in Canadian lithium mines and mine operators thereby skipping intermediary suppliers.

Whilst this may alleviate short-term supply threats, it is likely to have limited success in reducing costs – at best stabilizing them. According to consultants, AlixPartners, raw materials for EVs cost more than twice those for internal combustion engines: $8,255 per vehicle vs $3,662 per vehicle, as of May 2022.

What is more, with the primary supply sources concentrated in the Democratic Republic of Congo for cobalt, Southeast Asia and Russia for nickel, and Australia/Chile/China for lithium, to support sustainable electrification the industry will need to rapidly develop secondary sources of supply for these materials.

Map of sourcing locations for EV battery materials. Source: Dimitrios/Adobe StockMap of sourcing locations for EV battery materials. Source: Dimitrios/Adobe Stock

There is, however, another avenue manufacturers can follow. Through innovative vehicle design, the EV industry can reduce its reliance on these costly and strategically sensitive production raw materials.

In its quest to satisfy consumer demand for more range the EV industry has gravitated toward electrode materials capable of delivering higher energy densities. As a result, ternary layered oxides such as nickel–manganese–cobalt (NMC) and nickel–cobalt–aluminum (NCA) have become commonplace in LiB cathodes.

However, reliance on strategically critical metals such as nickel and cobalt exposes manufacturers to volatile supply and costing threats. For instance, after the invasion of Ukraine by Russia, the cost of nickel peaked at over $100,000 a ton. This was up from 18,465 U.S. dollars per metric ton in 2021, which was already an increase of nearly 5,000 U.S. dollars over the price in 2020.

Of course, the escalating price is a reflection of the underlying potential of a disrupted supply. Russia is the third largest supplier of nickel, accounting for nearly 13 percent of the total global nickel mining capacity in 2021.

Weary of disruption to the supply of strategic materials critical to the New Energy Vehicle program, Chinese battery manufacturers have been investing heavily in the development of lithium iron phosphate - commonly known as LFP - battery technologies. Whilst LFP batteries do not offer the same energy density, and consequently range, as cells with ternary layered oxide cathodes, they avoid the potential threat posed by the disruption to the supply of scarce strategically sensitive materials.

As one of the first LiB chemistries to be commercialized, LFP was relatively cheap, safe, had good cyclability and above all was abundant – in actual fact, the chemistry really only lost out to NMC/ NCA battery cells because of its limited energy capacity.

However, enabled by the safety of the chemistry, manufacturers such as BYD with its “Blade” battery, have turned to large format LFP cells that do not require assembly into modules within the battery pack, to boost energy density at a pack level.

This design does away with the inactive areas and hardware associated with the modules found in most current EV traction batteries. The housing, terminal plates, side plates, internal connectors, battery management, and cooling systems all add weight, take up precious volume and ultimately compromise the pack’s energy density.

It is therefore not surprising to see the world leader in EVs, Tesla, switching to this technology – first for vehicles produced in China that are not reliant on long range, but recently BYD has also started supplying LFP cells to the plant producing Model Ys in Grünheide, Germany.

However, according to a recent report from S&P Global Commodity Insights, while the price of cobalt is up around 85% and nickel about 55% over the past year, lithium has really gone through the roof - prices for battery-grade lithium have surged over 700% since the beginning of 2021.

So, looking to produce a low-cost battery that does not rely on lithium, CATL, the world's largest EV battery manufacturer, recently announced it will start production of sodium-ion batteries in 2023.

Although sodium-ion (Na-ion) batteries are approximately 3x heavier than lithium, they achieve better safety and because of the abundance of sodium, lower raw material costs, than Li-ion equivalents.

Wishing to keep costs under control in the face of rising lithium prices and potential bottlenecks in supply Chinese manufacturer Niu plans to launch its first electric two-wheeler with a sodium-ion battery next year.

The fragile nature of global supply chains has further been brought into stark relief with the escalation of the ongoing trade tensions between China and the U.S.

[Discover more about lithium battery technologies and manufacturers on GlobalSpec]

Solving material shortages with innovative designs

Because of their strategic importance, the fact that most rare earth metals originate in China is cause for grave concern within the motor industry. Any restrictions on exports, such as those imposed in 2010 and 2011 that drove up prices by between 4 and 9 times in less than a year, would be disastrous for the roll-out of EVs. Even without government intervention, the price of neodymium increased by more than 240% between March 2020 and March 2021.

Underlining the importance of a secure supply of rare earth metals at stable pricing, an article published in ‘Science Direct’ reported that a permanent magnet synchronous motor (PSM) requires between two to four and a half pounds of NdFeB (neodymium, iron and boron) alloy, depending on the power of the motor.

To mitigate the risks and reduce costs associated with rare earth magnets Renault has redesigned an EV electric motor with a magnet-free rotor winding process. The patented process also makes it possible to modulate the current flowing through the rotor to limit how much electricity the battery uses, especially at high speeds.

A U.K.-based company, Advanced Electric Machine (AEM), has also designed a magnet-free EV traction motor that not only does away with rare earth metals but also replaces the copper windings with aluminum. What is more, AEM’s next-generation Switched Reluctance Motor operates quietly with minimal torque ripple using the standard power electronics found in most EV drivetrains.

The company claims its SSRD range of motors delivers performance benefits that meet industry targets for 2035 today. The SSRD is capable of delivering 50% more power for 35% less weight than the current typical permanent magnet passenger car motor. With further development AEM expects these motors to eventually deliver power densities of up to 29 kW/l – more than ten times the original permanent magnet passenger car motors they were designed to replace.

So, with soaring prices and the threat of sporadic and unpredictable supply chain disruption manufacturers need to, not only put in place measures to reduce the risks of supply disruptions, but also step up efforts to design EV systems that do not rely on strategically vulnerable materials.

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