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Exide India bets big on electric vehicle’s future in India; plans to set up lithium ion battery plant


According to latest media reports, India’s largest automobile battery maker Exide Industries Ltd. plans to start assembling lithium-ion batteries in India soon by investing resources in manufacturing modules that will go into electric vehicles.

Betting big on the electric vehicle’s future in the country, Exide Batteries, is planning to set up a lithium ion battery plant by next year and will start the production of the batteries by 2019. The company will source technology from China-based Chaowei Power, a German battery manufacturer, and from the Indian Institute of Technology, Chennai, two people aware of the development told BloombergQuint.

“It’s a technology partnership for design and manufacture of Lithium Ion batteries with Zhejiang Chaowei Chuangyan Shiye Co Ltd Group. The deal was signed at the beginning of this year and will get over by 2025,” says a senior official in the company who requested anonymity, as reported by Fortune India. Also in terms of investments, officials said that over Rs 700 crore were required to build the ecosystem for the production of lithium ion batteries. “Such a huge investment has to be justified by ample demand in the market,” the official noted.

The company will have a separate plant for the manufacture of lithium ion batteries. It should be noted that the company has been in talks with the Kolkata Port Trust for 25 acres of land. The company has also asked Haldia Development Authority for an additional 25 acres of land. It is not clear if Exide is planning to set up manufacturing plants in these lands or if it would be used for other purposes. Earlier this year, the company invested Rs 700 crore in developing its state-of-the-art plant in Haldia. The new plant has been manufacturing next-generation automotive batteries using the ‘punched grid technology’ to increase the longevity of the batteries. The company has been in collaboration with the US-based East Penn Manufacturing Company for the technology.

Currently, the company has been manufacturing batteries for electric rickshaws. “We have launched a range of batteries for E-rickshaw applications. Batteries are being offered both in tubular as well as in flat plate design to ensure maximum performance under the challenging road conditions. We aim to offer e-mobility solutions for a wide range of applications, such as e-vans and e-buses, among others,” the company had said in its annual report for FY17.

The company, however has no plans to run traditional lead-acid batteries out of business in the coming years. According to the company official, lead acid batteries will remain in the market for the next two decades and the company has been making investments in the same.

Lithium-ion batteries (LIB) dominating the market for e-vehicle batteries

Currently most electric three-wheelers in India use lead acid batteries, which have a shorter life, duration, long charging time of 10 hours, and excess weight. Lead acid batteries typically have to be replaced every year and weigh around 120kg for an e-rickshaw application.

Lithium ion vs lead acid batteries

Low weight: In a lithium-ion battery, high energy density leads to low weight which translates into more kilometres between charges. While a Li-Ion battery weighs 35kg, a 48 V-80 Ah lead acid battery weighs 120kg.

Less charging time and long battery life: While a Li -Ion unit can be charged in only 1.5 to 3 hours, lead acid battery charging time is 8-10 hours or more. Li-Ion cells have a life of 1,500 cycles (NMC) and 3,000 cycles (LeFePo4) – a life up to 5 years. In comparison, lead acid batteries have a typical life of 360 cycles.

Low self-discharge: Li-Ion batteries have a low self-discharge which means if the vehicle is not used for some time, its charge status remains constant.

Low maintenance and cost-effective: Li-Ion batteries are often low maintenance. Li-Ion cells, unlike lead acid or nickel cadmium, do not require maintenance to ensure their performance, which makes it cost-effective.

Moreover, Lithium-ion batteries (LIB) are presently dominating the market for e-vehicle batteries, as many automobile giants like Tesla and Nissan have invested heavily in this technology. The LIBs primarily use graphite or silicon anodes and a liquid electrolyte. They are extremely lightweight and have a high cyclability. The energy density of LIBs compared to other emerging battery technologies is quite low. However, these batteries still need improvements in safety and durability, along with cost reductions.

Automakers are exploring electric options amid Indian government’s push to reduce reliance on fossil fuels and promote widespread adoption of electric vehicles. Battery-powered cars and motorbikes are taxed at 12 percent under the Goods and Services Tax compared to at least 43 percent levy on other vehicles. The government has already placed its first order for electric sedans, that will be shared by Tata Motors Ltd. and Mahindra & Mahindra Ltd.

Pune-based Kinetic Green Energy and Power Solutions has launched its first electric three-wheeler, the Kinetic Safar. It is the first e-rickshaw in the country to be equipped with a lithium ion battery.

According to the report entitled “India Lithium-ion Batteries Market Forecast and Opportunities, 2020,” presented by Market Reports on India, the market for Li-ion batteries market in India is projected to witness vigorous double-digit growth at over 35 per cent CAGR during the period of 2015-20. The report further says that government’s efforts to minimize carbon emissions and toxicity level in the environment is likely to drive the adoption of Li-ion batteries across major end-use industries including consumer electronics and automotive. In addition, the government has announced tax exemption on electric vehicles powered by Li-ion batteries, which is anticipated to drive the market over these years.

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