New Business Models

Government across various countries are supporting the local manufacturing unit of batteries. This will further help to engineer the batteries suitable for the local and regional temperature. Majority of the OEMs are dependent on the lithium Ion based battery technology given the higher power density and charging and discharging efficiency. The low price of the battery and better technological advancement would fuel the market for electric vehicle batteries. With respect to the market adoption, the electric vehicle batteries also face some challenges with respect to charging, lifetime operational characteristics and others. The challenges pertaining to batteries in the electric vehicles are listed below.

At present, the charging time for the vehicle poses a serious threat in vehicle adoption. A normal charger will approximately take anywhere between 10 to 12 hours of time to fully charge the battery. Whereas fast charging method will reduce the time, it requires additional amendments that need to be made to the vehicle to improve the cooling efficiency. This further increases the cost of a vehicle further discouraging a customer with vehicle adoption.

The capacity of the battery to store energy with respect to its weight is pretty low. This will further limit the driving range of the vehicle. Thus it is very important to derive new chemistry which increases the storage capacity with respect to the battery weight.

Performance of a battery in different temperature poses a significant challenge in wide adoption. It is difficult to engineer a battery which provides similar performance in both high and low-temperature regions. Thus it is very important for the battery manufacturers to design a battery with separate chemistries for both the weather conditions.

The life span of the battery is the other important phenomenon which can restrict the adoption of electric vehicles. It is further divided into two parts i.e. the overall age of the battery and its charging stability. The number of times battery is charged further increase its degradation. In addition, temperature plays a crucial part in determining the overall age of the battery. Thus it is important to address these challenges to boost the impact of electric vehicles.

The single most important challenge for all the battery technology is its security. The chemical reactions in the cells can aggravate heat in the battery putting the complete vehicle safety in jeopardy. This concern can further lead a customer to turn a blind eye towards the adoption of an electric vehicle. Thus it is very important for the vehicle OEM’s and battery manufacturer to improve the thermal runaway as per the battery technology. In addition, customer staying in the hot regions should also be made aware of the thermal runaway while vehicle purchase.

To address the above-mentioned challenges, Automo expects that the following business model will play a crucial role in the successful implementation of the electric vehicles

Battery Swapping: To increase the adoption rate of the electric vehicle, companies should provide a special appeal to the customer such as fossil fuel cars. The above concern can be easily alleviated if the customer is provided with access to the battery swapping station. In the battery swapping station, the driver needs to invest the same time as refueling the car. This model eliminates worries about downtime.

Secondary Usage of Battery: The battery employed for the secondary use or some other application will palliate the environmental concerns over battery disposal. The batteries of EV can be employed for various applications such as storage for powering home and business appliance. Automo believes that this business model has tremendous potential for the future, especially when countries such as China has passed a resolution in which the EV manufacturer has to take care of battery disposal.

Extra Battery Pack: In the future, when the battery cost drops to a low level, OEMs are expected to supply an extra battery pack to the customers instead of dropping the vehicle price. This model will work exactly similar to the existing extra tire with the vehicle. This will further help the customer to replace it with the drained battery and continue with their travel.

Reusing Battery Material: Lithium-ion battery pack is expected to have more than 100 individual cells, assembly pack, control circuitry, and a thermal management system. The battery once sends into the recycling process, can recover valuable items from the battery which can be reused in the other battery. Thus the production of a new battery will be achieved with a lower cost. In addition, the same network that distributes the battery can safely collect and return the use of the battery pack.

The battery accounts for a major part of the electric vehicle cost. With the declining battery cost, the adoption rate of electric vehicles is anticipated to incline. Majority of the OEMs are trying to reduce the cost similar to that of the ICE based vehicle which would address a major challenge in the adoption of the electric vehicles. The companies are also looking at a different business model which will further address the current challenges with respect to charging, energy, operational characteristics, lifetime and security.

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Automo’s global consulting team is exclusively positioned to identify and assess opportunities related to growth but also empowers our client to create strategies for the future which further enables them to convert goals into reality.