I think you have 2 pieces to the answer but you have not connected them together.
First - Design
"Also, the U.S. has long been dominant in the design of phones and laptop computers"
Here is the missing link - People who design today can be totally and 100% ignorant of materials and components they "black box" into their design.
Second - Supply Chains
You are on point again - but still have the critical missing flaw and hole here.
The Answer: Integrated Manufacturing and Design.
Distended uncoupled supply from Design is why batteries got largely ignored.
It really is important to have deep backwards integration from product design and development back to systems, subsystems, components and critical materials.
Remember Henry Ford - Dearborn worked because he could innovative all along the way from making steel, to casting engine blocks to stamping fenders to welding frames and finishing a car.
Backward integration got out of vogue with the old management mantra - focus on what you're good at. But, somethings below product level require company excellence.
Examples:
Car makers never outsource combustion engine design, engineering and manufacturing.
Intel never outsources design and manufacturing.
Apple did outsource manufacturing to Terry Gau, ie Hon Hai aka Foxconn.
Samsung integrates all.
Boeing outsourced large frame and components. Clearly an unmitigated failure.
Old IBM laptop company would have controlled supply.
Tesla, truthfully is a small player in automotive. Disruptive some, but lacking the breadth and depth of engine development of a GM or Ford.
So... when designers are closely coupled to critical processes, materials, ie batteries... they not only merely buy them, they actually lead engineering of the things
On Tesla - isn't a key factor in electric cars the lack of an ICE that requires excellence? The nature of electric motors is that they are so much less sophisticated. Saying Tesla lacks breadth and depth in engine design may well prove to be like saying Nivida lacks breadth and depth in vacuum-tube transitor manufacturing.
Hardly an original insight from me, I'm not qualified to speak to the direct engineering aspect and the impact is already well underway. What I would say, is that we're already seeing the impact on legacy car manufacturers. For example, the Mittlestandt in Germany, the major European and US auto manufacturers have all made the very precise manufacturing of ICE the main thing they do in house to capture value. It is correct to say businesses have a deep cultural focus on ICE manufacturing.
This, one of the reasons why the Chinese electric car manufacturers have caught up so rapidly is because the ICE to battery/moter is such a massive transition in terms of business model and culture a new player has a huge advantage over an incumbent.
Tesla did exactly that with batteries, and still has the biggest US battery factory (joint with Panasonic) in Nevada. GM made their early EV1 electric car but only used existing lead acid batteries, and some NiMH. Apparently they weren’t developing this car as a product , but only in response to California regulations so weren’t serious. GM and the other 2 of the big 3 dinosaurs could’ve bought batteries from Tesla but made with Chinese and South Korean battery makers instead.
Lithium ion batteries for production were made by Sony in 1991 for their Handicams (I still have one) and later were used in laptop PCs and then cellphones, before being used in electric cars much later. Why didn’t Japan become the leader in batteries, instead of China? Sony does deep design integration and used these batteries for Handicams, Vaio laptops and cellphones, but never considered cars (it does do music, games, movies and banking) as a product nor worked with any big Japanese car manufacturers.
All the Japanese companies manufacture part of their production in China and use Chinese materials and components. Panasonic opened a battery plant in Suzhou in 2000 as well as in other Chinese cities in following years and has continued to upgrade and invest since then.
Companies want cheap manufacturing locations with less regulation and good economies of scale.
China used these advantages to gain IP and experience and critical mass of skilled Labour. China is an attractive place to manufacture and is a potentially huge market in its own right- companies will continue to produce and sell there. International trade benefits everyone, but that doesn’t necessarily mean that nearly every product needs to touch China in some way. China doesn’t treat foreign companies and products fairly. While progressive activists have spent a lot of time, money and effort seeking passive/aggressive ways to punish oil companies by pushing regulations and disclosure rules on CO2 footprints, etc, maybe we’d be better off if every company had to disclose its supply chain and revenue risks from doing business with China (and maybe add Russia and Iran).?
The US has relatively cheap land and electricity (outside of CA and a few other states) and a great freight rail system, though has slow permitting, limited skilled labor and tougher enviro rules. As manufacturing becomes more robotic/automated the US should benefit as the labor cost component should fall (but remaining labor needs to be more highly skilled). China, India and Asia generally does a good job of producing lower tier engineers with the skills to work in complex manufacturing but a willingness to be paid like skilled manufacturing labor (rather than like American chip designers or system architects). There are easier majors than STEM or engineering in America that offer good job prospects and our primary/secondary educational system is a complete failure at teaching reading, writing, math and science. We need to move education to a block grant system and encourage companies to start schools and incent the companies to provide apprenticeship and internship programs in manufacturing. Of course, the teachers unions and the AFL-CIO and UAW will donate a lot to ensure this never happens. Since special interests will prevent investing in the American student and workforce, skilled immigration will be neede. There are smart kids in Latam, in Africa, E Europe, and across Asia with decent engineering skills and enough intelligence to be trained on the job. We should favor manufacturing management over tech program analysts when it comes to H1Bs, or start a new program that is manufacturing aligned.
We should invest in basic research rather than subsidizing end products and ensure that, from a national security standpoint, we have a core of capability and expertise in the US and in friendly countries. This doesn’t mean an end to international trade, which is profitable and beneficial. Do I see all these good things happening- no, of course not!
“Intel never outsources design and manufacturing.”
On design, of course, I agree with you 100%.
On manufacturing, however, given how poorly Intel has done compared to numerous other semiconductor companies who Do outsource their manufacturing to the TSMCs of the world, you could hardly have picked a worse example.
“ Tesla, truthfully is a small player in automotive.”
Wow, so the fact that the market has judged that Tesla is worth more than all the U.S. auto companies combined means nothing, huh? So you know better than hundreds of thousands of investors who have staked their money and their livelihoods on it that Tesla is and will remain just a small player, huh?
Have you put your money where your mouth is and shorted Tesla to buy GM and Ford? How has that worked out for you over the last several years. [and note what I say is still correct even if Tesla’s market cap were to fall by 75% tomorrow!]
Where I notice this is in all the battery powered stuff that is really common in Europe, but seemingly doesn't exist in the US. One very mundane example of a battery application that has TOTALLY dominated the market here in Sweden for a decade-plus, but just plain hardly exists in the US at all: robotic lawnmowers. In Sweden, it's now very weird to have a gasoline-powered lawnmower. We're the last holdouts in my entire neighborhood (I actually enjoy getting the steps in). Everyone else has a lithium-battery-powered, autonomous one. It's easily one of the most universally-adopted battery-powered consumer devices here, after the mobile phone and laptop.
When I come back home to the US, though, I look in vain for even a single example of this ubiquitous consumer tech on any lawn to be seen. I've asked people about them and they look at me like I'm coming from the year 3000. Now, the lack of this particular commercialized technology in the United States just mystifies me, when it makes even more sense for Americans with their big lawns, hot outdoor temperatures, and cheap electricity!
But who created this market in Sweden? A very old Swedish appliance manufacturer, Husqvarna, who first commercialized an affordable, solar-powered robotic lawnmower in the 1990s (when the batteries and charging stations weren't good enough to keep them going as consistently). They were soon joined by German manufacturer Bosch, who mastered the random-walk mowing system now most commonly used. Another German manufacturer, Gardena, made smaller, even cheaper versions for modest lawns. Do any American firms make these? I don't know. But maybe that's part of the problem, the decline of American manufacturing, especially these medium-sized manufacturers who are often the commercializers of this type of consumer tech? Because here in Northern Europe, you're going to see many of these innovative inventions hit the shelves from local, European manufacturers like Electrolux, Miele, or Philips. And those are very old, very established manufacturers, not startups. Otherwise, the devices will be East Asian imports.
It's unfortunate that mowed lawns are essentially ecological deserts, and harmful to the planet on all kinds of levels (heating, biological diversity & pollenization, flood mitigation, water purification), so it's rather a perverse "benefit" of batteries in this case, but I guess still better than polluting and noisy gas-powered mowers.
Totally agreed. But Swedes bought into the same 18th/19th Century English aristocratic pastoral ideal of the grass lawn as Americans did, and for similar reasons. Lawns are less ubiquitous here than in the US (most Swedes live in apartment co-ops, not villas/houses, and the landscape is more urban or rural rather than suburban), though, and generally smaller. Swedes are also enthusiastic gardeners, including a kitchen garden plot most anywhere where there's enough space for raised beds. Even better, it's increasingly common for people with yards to set aside or establish a flower meadow for bees.
I hope flower meadows can catch on outside of Sweden! They are wonderful. Sadly, HOAs tend to get mad if you try to do that in your suburban neighborhood in the States. :(
I live in a technology-focused city and I know a few people who have one (including our botanical garden, actually)! but I think a big part of it was that they weren't advertised. The EGO battery powered outdoor appliance commercials do NUMBERS locally--every time I walk into a local hardware store their shelf space has doubled, and I now know more homeowners who've bought into one of those systems than who haven't--but I never saw a commercial for the Husqvarna "lawn roomba" and wouldn't have known they were a product at all if I didn't have a Husq sewing machine.
Did we "miss" it, or did China just beat us fair and square? There were plenty of people in the US working on new battery tech. Just not nearly as many as in China.
It seems like we should expect this sort of thing to happen more, going forward. It's not the 20th century anymore, where the US was by far the largest country that could afford universities and wasn't bombed to rubble by WW2. China is much larger, they've got great universities and engineers, and they're going to keep on creating new technology. Hopefully we can learn from them.
But 90% of the planet's rare earths are located in China. What business innovators would risk investment in an industry, where 90% of your feedstock is under the control of hostile rivals?
As I understand it, the causation goes the oppositie direction. the *proven reserves" of rare earths are in China because they're only country investing enough in batteries to actually care about finding them and mining them at large scale.
It always was- but it has the same elite focus, government and corporate investment tradeoffs as the battery conversation. China has the majority of proven reserves and active mining site from both the commercial incentives of it being input to the supply-chain and worth ccp-points for the provincial cadre. Exploration and digging in the US probably doesn’t have the roi on a free market-basis.
I think we missed the battery thing because we thought we had the whole energy thing licked. We would continue to drive around our gigantic, relatively low-density country in ICE vehicles. We would continue to generate electricity and transmit it to fixed location facilities. With fracking and other energy resources, we knew we had enough energy resources to maintain this pattern indefinitely. Climate change was not yet recognized as an existential problem, and besides our carbon footprint was going down through innovative conservation.
Bottom Line: Because there was no perceived necessity, there was no mother for battery innovation in the US.
Another way of asking the question is trying to figure out what necessities China faced that inspired them to create batteries as an alternative to the ICE. Currently in China, gasoline is $0.96 per litre ($3.63 per gallon) and diesel is $1.07 per liter ($4.05 per gallon). These prices are not much higher than American prices, but one must realize that China must import most of its hydrocarbon fuel, and prices would go much higher if much more of that fuel was imported.
This creates three downsides:
• A greater dependence on hydrocarbon imports would create international vulnerabilities.
• The Chinese government has a commitment to the development of its interior including many places that will never be reached by railroad.
• XI has a demonstrated a strong interest in reducing pollution in China.
Sounds like they had much more motivation than we ever did.
Watch the 2006 documentary "Who Killed the Electric Car" if you want an insight into the staunch opposition to applied battery-electric tech in the US by two key US sectors: Energy & Auto Manufacturing. In both industries, it was all about short term over long-term profits.
Big Oil/Coal is still fighting the growth of renewable electric power tooth and nail. Automakers are doing a flip; but only because consumer sentiment is forcing them to.
I'm inclined to believe the killing of the electric car actually played a disproportionately large role in slowing battery research. The scale compared to modem electronics is just orders of magnitude different. It takes something like 7000 phone batteries to get to the energy storage of a modem EV.
I wonder how much the fracking revolution of the last 15 years played into this? Why invest in batteries when you have energy abundance from other sources. The British originally started digging up coal because they ran out of forest.
I've worked in the PV and ESS industry in the US for the last 17 years and my focus for the last 7 years has been stationary energy storage systems. I think your article totally misrepresents what has been happening in the US on the ESS front for the last decade. Yes, most LFP cells are made abroad, especially in China, but the US doesn't make PV cells much domestically, either, so the real story here isn't about "innovation" but about the US's struggles to scale the production of complex, materially intensive commodities. What's more, in the next decade, the energy storage industry is likely to diversify away from LFP as the frontier commercial energy storage technology, so it's not yet clear where the industry's center of gravity will be in the 2030s, especially if China chooses war.
There are plenty of domestic companies out there focused on building energy storage *systems* and deploying them in vehicles and C&I installations, and this has been a very active area of development over the whole period in which you're saying that little has been happening. I think the issue is that *you* missed out on this development, as an observer, not that the *United States* as a whole has.
I also think you're wrong about the importance of battery-powered appliances in things like stoves. Certainly, there will be some of this, but cars and stationary batteries have far more flexibility and value to energy systems in home and businesses and across larger chunks of energy infrastructure. And there can be real downsides; for example, I don't particularly want a battery that is susceptible to thermal runaway in a stove inside my house, and why would I ever need to boil water in 40 seconds? So battery-powered appliances will remain niche products.
The real action here is not in batteries, per se, it is in the signaling systems that can control storage AND load AND generation, paired with the intelligence to optimize these controls, and the markets they operate within, to commoditize energy services. If you really want to look at where the energy industry is headed, this is the area that deserves the most attention.
I thought that the importance of battery powered stoves would be in achieving performance similar to gas stoves in temperature and speed. How different are gas stoves from battery stoves in terms of their risks? Right now electric ranges are very inferior to gas ranges.
First, the need for a "high-performance" stovetop seems pretty niche to me. Anybody can cook a pretty wide selection of delicious food with conventional electric stoves. You can even boil water with them! Sure, there are folks who are really into cooking or who have money and want a "luxury" stove when they decide to remodel, and there's no issue with serving that market. As far as I've seen, the well-publicized Impulse Labs product is not aimed towards the commercial market, which is probably larger for this type of thing. I would need to see some evidence that there's a lot of demand for "high performance" cooking equipment in the household market to think these appliances are going to have a significant market impact or can scale to have an impact as a demand response resource for the grid.
Yes, natural gas infrastructure in your home also can pose a hazard! And li-ion batteries are generally pretty safe; after we all them in our phones and cordless drills and so forth. I'm sure the engineers making these products have looked at this closely, but placing li-ion batteries in close proximity to a heat source raises the risk level for thermal runaway. What's more, batteries lose capacity over time and eventually need to be replaced. None of this is fatal, but it isn't appealing.
My point here is that I see Noah's enthusiasm for the revolutionary potential of battery-powered appliances as misplaced.
Thanks for the shoutout and I like this format of posing a question and collecting feedback into a longer-form blog post. A couple follow-ups:
“But it can’t easily explain why the U.S. paid insufficient attention to the technology before it was commercialized, back in the 1980s and 1990s.”
Rechargeable batteries were commercialized in the 80s and 90s - for consumer electronics like cordless phones. They weren’t commercialized for what is being envisaged today. But this is where my path dependency argument kicks in. Once they were commercialized for consumer electronics, future use cases would naturally gravitate to existing supply chains.
“Solar power: The U.S. was very early to the idea that solar power would be a replacement for fossil fuels. The Carter administration heavily promoted the technology (famously putting solar panels on the White House), more than 30 years before it became cost-competitive with fossil fuels.”
I would put solar and batteries in the same category and ask why the U.S. didn’t do more. While solar captured the imagination of some in the 70s and 80s, commercialization was really driven by niche use cases like the space industry. The U.S. never really thought strategically about pushing it to replace fossil fuels in the power grid. Germany was the first to really do that, as you note, in the mid-2000s.
I think lack of strategic push in both batteries and solar for true widescale fossil fuel replacement was in large part due to some of the other factors cited, principally the fracking revolution that recently made the U.S. energy independent again after decades of insecurity.
The solar panel companies Carter backed went bust.
The inefficient wind turbines he paid to put on the Altamont pass were terribly inefficient and ensured that some of the most lucrative locations for generation were blocked for decades with bad tech. They’ve finally been replaced.
Artificially stimulating demand and forcing consumption of uncompetitive products has a cost beyond just the government spending
Advances in semiconductors helped drive Solar efficiency,, not Carter’s subsidies. In the case of turbines, European subsidies certainly helped to create a domestic industry, I agree
In his book, he argues that innovation is too often confused with invention. Invention is coming up with the idea and even patenting it, while "innovation is what happens when I take those ideas and actualize them in the economy.”
Look up the documentary, "Who killed the electric car?"
From the synopsis,
"Following a strict mandate on air emissions in California, General Motors launches the EV-1 in 1997. It is an electric automobile that requires no gas, oil, muffler or brake changes and is, seemingly, the world's first perfect car. Yet six years later, GM recalls and destroys the EV-1 fleet. Filmmaker Chris Paine examines the birth and death of a revolutionary vehicle."
That's more than 10 years before the first Tesla (released in 2008). It was an American company with massive amounts of institutional knowledge.
GM killed their own innovation and the Bush administration let them.
Imagine if Raytheon had made cheap munitions drones in 2013 and then scrapped all of them in 2016 to avoid competing with the big complex Predator and Reaper drones, that would be a big part of how the US "lost " the lead in drones.
The US had electric cars by a major us company which was a great platform for iterative development, (because California did the forward thanking requirements) and the US car industry killed it while the national government gave them a high five.
To me it seems obvious that General Motors built the EV-1 purely to comply with California's mandate: that explains why they were never offered for sale (only for lease) to make it easy for GM to kill the project as soon as the mandate was repealed.
Obviously, but that still puts a lot of support for hypothesis #3.
Everyone knows the Kodak story. They invented the first digital camera and then sat on the technology in order not to harm their film business.
Imagine if they had invented digital cameras to comply with a mandate from New York State and had leased out some to photography customers. Then they killed all of those cameras when new York repealed the mandate.
We would still blame Kodak for dropping the ball and setting the US back a decade in digital photography.
Tell that to the Kodak shareholders who lost everything. Because of a rotten-ness in American management culture that shits on long-term profitability.
Same thing with GM & Ford during the EV1 era. THEY would be the global leaders right now in battery tech if not for managerial incompetence. Another massive screwing of shareholders.
How much money did they make per car? I would be genuinely shocked if they had a product that would make them rich(er) and had a better risk adjusted rate of return and then they just scrapped it because of some conspiracy. They turned down tens of billions of dollars in profits and shareholder wealth and management compensation just to keep people in other industries and the government happy? Instead of bribing politicians to make more money?
The short answer is that the electric vehicles made money, but the value proposition was "Buy an electric car because combustion is pollution"
GM was making ads saying this, and others in GM were upset that they were stepping on their other ads for their general cars.
Essentially, the electric cars made money... But there were legitimate fears that they were cannibalizing their existing customers and the electric car ads were reaching a lot of people.
They felt that the money was more profitably spent on their existing internal combustion business.
Just like Kodak... They didn't kill the digital camera business because it wasn't profitable, they killed it because they feared it would compete with their existing profitable film business.
That just seems like bean counters making bean counter decisions. And probably the correct decision as well. EVs are a new technology, and should be made by new companies who haven’t accumulated decades (or even a century) of assumptions about how to build and sell a vehicle.
No analysis of the rise of China's battery industry is complete without knowing
- how BYD and CATL's precursor ATL started
- how China's industrial chain was positioned very well to benefit
- how the CCP's effective, sustained multidecadal policy push for lithium ion batteries (LIBs) ensured no other country would catch up (yet)
Wang Chuanfu founded BYD in 1995, not making cars, but consumer electronics batteries. BYD quickly caught up to the Japanese (Sony, Sanyo and Panasonic) and the Koreans (LG) in LIB cell technology and manufacturing. Back in the late 90s/early 2000s, they relied on an abundant and cheap labor force. They quickly became a supplier to Motorola, Nokia and then Apple on the iPod and various other consumer electronics products. They also invested heavily in lithium iron phosphate cells starting in the early 2000s. It's hard to say if this was independent of the commercialization efforts by A123 in the US at the time, but they either stole or reverse engineered the cell chemistry from Goodenough and Hydro Quebec's patents.
They were already a dominant force in the consumer electronics LIB industry by the mid 2000s.
Robin Zheng founded ATL in 1999. ATL was acquired in 2005 by TDK and then spun out as CATL in 2012, now the #1 battery cell and pack manufacturer in the world (BYD is #2). Zheng had also worked for TDK in China prior to founding ATL, and likely was exposed there to the rapid changes LIBs were having on the Japanese consumer electronics industry. Prior to their acquisition, they were also a leading LIB supplier to cellphone and other electronics OEMs.
Basically the two dominant LIB manufacturers globally today with over 50% market share, were already very strong in LIBs for consumer electronics by the mid 2000s, at the time the largest market for LIBs.
We also can't just look at any one industry of context of the relevant industrial chain. During the late 90s and early 2000s, China was increasingly becoming the manufacturing superpower of the world. Demand for consumer electronics was surging, Shenzhen's Shanzhai culture was doing for hardware development what Linux was doing for open source software, upstream suppliers of materials like chemicals were growing and demand for machine tools was too.
The US had none of these tailwinds.
The CCP saw the early potential of LIBs, and has used industrial policy to supercharge the industry since the 11th five year plan from 2006 to 2010. That financial and administrative support has persisted and evolved until the present day.
The US has not executed multidecadal industrial policy for a long time. But for the US to even have had a shot to be globally competitive in this industry (even just for EVs), it would have been a multidecadal effort. We need the state capacity, coordination and persistence to stand up industries like LIBs.
It's also too late for the US to grab a double digit global share of current chemistries like high nickel and manganese iron phosphate. Not to mention we lack the selection of EVs to ramp demand fast enough. No, we should be doing more to accelerate nascent promising alternate chemistries like silicon anodes, solid state electrolytes and more. They need help to cross the chasm from r&d to commercialization, and only sustained policy support will ensure these industries don't fail like A123 did.
And Hyundai had its start in auto repair, construction and infrastructure projects and shipbuilding among other industries prior to their automotive business.
Both are starting to ramp for automotive use cases, silicon anode in the US and semi solid state in China. Profitability will depend on unit economics at scale, which for the US is hard because of how small our EV market is vs China and even the EU.
I think it mostly came down to its probably easy to copy battery chemistry and it's not really patent-able, so it was always going to be a low margin, no-moat endeavor.
Noah, Please! You would basically need an Engineering degree to understand a response short enough to fit here. Absent that, please just go talk to a good one. He/She will be able to guide you around all the pitfalls in this discussion.
There would be engineers among the readership here. I encourage you to post the short technical commentary and then the readers can translate and debate for themselves.
Ah, gasoline, ethanol, diesel,etc have been portable energy sources for a while now. And while solar is greatly improved, it's still an intermittent source for electricity.
The solar cells only work when illuminated (which on earth is less than half of the time) and are thus very intermittent, the batteries only cover up for the dark times, and only for a fixed time period. The only way solar would be not intermittent were if the batteries covering for it hold enough to store more than 12 hours (near the equator, seasonally more or less in other latitudes) of the solar cell output and if all clouds ceased to exist..
Gasoline stores solar energy from photosynthetic plants that dinosaurs digest and then died until we sucked up their decayed crude that was then converted to gasoline. It’s not an easily reproducible step, but it is storage. Companies like Carbon Engineering in Canada are creating liquid hydrocarbon fuels from just air, so it is technically possible.
That's one of several different characteristics, all of which inform the mix of applications that batteries, synthetic fuels and hydrogen are likely to end up serving, or in a few cases, competing.
A tanker of oil is definitely moving an unimaginable amount of energy through space and time. Hydrocarbons are a value chain that includes energy production and storage and transport.
I wonder if American's relative affluence, and thus early experience with battery powered devices, may have actually turned us off batteries. They didn't used to be great! We have multiple generations in the workforce who had decades of batteries dying all the time, exploding and leaking, etc etc. And they were expensive to boot--remember the old joke about "I don't know what I spent more money on, the Christmas presents or the batteries"? Anyways, sometimes being the early adopters means you form an opinion based on the shitty version of the product.
It's often the case that innovators get so good at one product they get leapfrogged by successor technologies.
It happened with Toyota, which got very good at hybrid internal combustion engines. The first generation Priuses were a money sink and had long waits until after several years they were profitable. Toyota gained expertise by making a hybrid version of just about every model, and I think they have just two plug-ins: Prius and RAV4 Prime.
Toyota (and Subaru) has an infamous flop with the first true EV, the bZ4X/Solterra, so much so that some dealers were leasing them for $150 a month (!) to get them off the lots. The EV has California compliance car specs, but have very low range and slow charge times relative to other EVs. Meanwhile, Hyundai and Kia surpassed the Japanese carmakers with EVs and plug-ins with superior range. Nissan's Ariya is the best of the Japanese EVs.
Scientific progress and basic research doesn’t buy votes.
Batteries and solar are a dirty business with many of the materials and basic components easily and cheaply produced in China.
By paying rich people to buy EVs or put solar on their roof, we are essentially paying people to buy Chinese products. While Tesla is, in part, a “battery company”, it relies on China for a lot of raw materials and intermediate components.
I always thought that investing in basic research in battery tech and grid storage solutions and upgrading the grid made a lot more sense than paying rich people to buy Chinese products, but I am not a politician.
If a major discovery in, say, the Americas, lowered that number to 50%, how would that affect your calculus? Or a major battery-tech innovation that nixes the rare earths dependency?
Still don’t believe in buying votes from rich, white people. Retail solutions, like rooftop solar and EVs are foolish uses of resources, IMO. It is just some idiot pols vision of how things should be . Levy a carbon tax and let the market decide, while investing in basic research
Cool video. Great essay.
I think you have 2 pieces to the answer but you have not connected them together.
First - Design
"Also, the U.S. has long been dominant in the design of phones and laptop computers"
Here is the missing link - People who design today can be totally and 100% ignorant of materials and components they "black box" into their design.
Second - Supply Chains
You are on point again - but still have the critical missing flaw and hole here.
The Answer: Integrated Manufacturing and Design.
Distended uncoupled supply from Design is why batteries got largely ignored.
It really is important to have deep backwards integration from product design and development back to systems, subsystems, components and critical materials.
Remember Henry Ford - Dearborn worked because he could innovative all along the way from making steel, to casting engine blocks to stamping fenders to welding frames and finishing a car.
Backward integration got out of vogue with the old management mantra - focus on what you're good at. But, somethings below product level require company excellence.
Examples:
Car makers never outsource combustion engine design, engineering and manufacturing.
Intel never outsources design and manufacturing.
Apple did outsource manufacturing to Terry Gau, ie Hon Hai aka Foxconn.
Samsung integrates all.
Boeing outsourced large frame and components. Clearly an unmitigated failure.
Old IBM laptop company would have controlled supply.
Tesla, truthfully is a small player in automotive. Disruptive some, but lacking the breadth and depth of engine development of a GM or Ford.
So... when designers are closely coupled to critical processes, materials, ie batteries... they not only merely buy them, they actually lead engineering of the things
On Tesla - isn't a key factor in electric cars the lack of an ICE that requires excellence? The nature of electric motors is that they are so much less sophisticated. Saying Tesla lacks breadth and depth in engine design may well prove to be like saying Nivida lacks breadth and depth in vacuum-tube transitor manufacturing.
Joseph, that's a thought-provoking comparison--How do you think the shift to electric motors will impact the future of automotive engineering?
Hardly an original insight from me, I'm not qualified to speak to the direct engineering aspect and the impact is already well underway. What I would say, is that we're already seeing the impact on legacy car manufacturers. For example, the Mittlestandt in Germany, the major European and US auto manufacturers have all made the very precise manufacturing of ICE the main thing they do in house to capture value. It is correct to say businesses have a deep cultural focus on ICE manufacturing.
This, one of the reasons why the Chinese electric car manufacturers have caught up so rapidly is because the ICE to battery/moter is such a massive transition in terms of business model and culture a new player has a huge advantage over an incumbent.
Tesla did exactly that with batteries, and still has the biggest US battery factory (joint with Panasonic) in Nevada. GM made their early EV1 electric car but only used existing lead acid batteries, and some NiMH. Apparently they weren’t developing this car as a product , but only in response to California regulations so weren’t serious. GM and the other 2 of the big 3 dinosaurs could’ve bought batteries from Tesla but made with Chinese and South Korean battery makers instead.
Lithium ion batteries for production were made by Sony in 1991 for their Handicams (I still have one) and later were used in laptop PCs and then cellphones, before being used in electric cars much later. Why didn’t Japan become the leader in batteries, instead of China? Sony does deep design integration and used these batteries for Handicams, Vaio laptops and cellphones, but never considered cars (it does do music, games, movies and banking) as a product nor worked with any big Japanese car manufacturers.
All the Japanese companies manufacture part of their production in China and use Chinese materials and components. Panasonic opened a battery plant in Suzhou in 2000 as well as in other Chinese cities in following years and has continued to upgrade and invest since then.
Yes, in your opinion, what do you think are the biggest challenges and benefits of this international collaboration?
Companies want cheap manufacturing locations with less regulation and good economies of scale.
China used these advantages to gain IP and experience and critical mass of skilled Labour. China is an attractive place to manufacture and is a potentially huge market in its own right- companies will continue to produce and sell there. International trade benefits everyone, but that doesn’t necessarily mean that nearly every product needs to touch China in some way. China doesn’t treat foreign companies and products fairly. While progressive activists have spent a lot of time, money and effort seeking passive/aggressive ways to punish oil companies by pushing regulations and disclosure rules on CO2 footprints, etc, maybe we’d be better off if every company had to disclose its supply chain and revenue risks from doing business with China (and maybe add Russia and Iran).?
The US has relatively cheap land and electricity (outside of CA and a few other states) and a great freight rail system, though has slow permitting, limited skilled labor and tougher enviro rules. As manufacturing becomes more robotic/automated the US should benefit as the labor cost component should fall (but remaining labor needs to be more highly skilled). China, India and Asia generally does a good job of producing lower tier engineers with the skills to work in complex manufacturing but a willingness to be paid like skilled manufacturing labor (rather than like American chip designers or system architects). There are easier majors than STEM or engineering in America that offer good job prospects and our primary/secondary educational system is a complete failure at teaching reading, writing, math and science. We need to move education to a block grant system and encourage companies to start schools and incent the companies to provide apprenticeship and internship programs in manufacturing. Of course, the teachers unions and the AFL-CIO and UAW will donate a lot to ensure this never happens. Since special interests will prevent investing in the American student and workforce, skilled immigration will be neede. There are smart kids in Latam, in Africa, E Europe, and across Asia with decent engineering skills and enough intelligence to be trained on the job. We should favor manufacturing management over tech program analysts when it comes to H1Bs, or start a new program that is manufacturing aligned.
We should invest in basic research rather than subsidizing end products and ensure that, from a national security standpoint, we have a core of capability and expertise in the US and in friendly countries. This doesn’t mean an end to international trade, which is profitable and beneficial. Do I see all these good things happening- no, of course not!
“Intel never outsources design and manufacturing.”
On design, of course, I agree with you 100%.
On manufacturing, however, given how poorly Intel has done compared to numerous other semiconductor companies who Do outsource their manufacturing to the TSMCs of the world, you could hardly have picked a worse example.
“ Tesla, truthfully is a small player in automotive.”
Wow, so the fact that the market has judged that Tesla is worth more than all the U.S. auto companies combined means nothing, huh? So you know better than hundreds of thousands of investors who have staked their money and their livelihoods on it that Tesla is and will remain just a small player, huh?
Have you put your money where your mouth is and shorted Tesla to buy GM and Ford? How has that worked out for you over the last several years. [and note what I say is still correct even if Tesla’s market cap were to fall by 75% tomorrow!]
Where I notice this is in all the battery powered stuff that is really common in Europe, but seemingly doesn't exist in the US. One very mundane example of a battery application that has TOTALLY dominated the market here in Sweden for a decade-plus, but just plain hardly exists in the US at all: robotic lawnmowers. In Sweden, it's now very weird to have a gasoline-powered lawnmower. We're the last holdouts in my entire neighborhood (I actually enjoy getting the steps in). Everyone else has a lithium-battery-powered, autonomous one. It's easily one of the most universally-adopted battery-powered consumer devices here, after the mobile phone and laptop.
When I come back home to the US, though, I look in vain for even a single example of this ubiquitous consumer tech on any lawn to be seen. I've asked people about them and they look at me like I'm coming from the year 3000. Now, the lack of this particular commercialized technology in the United States just mystifies me, when it makes even more sense for Americans with their big lawns, hot outdoor temperatures, and cheap electricity!
But who created this market in Sweden? A very old Swedish appliance manufacturer, Husqvarna, who first commercialized an affordable, solar-powered robotic lawnmower in the 1990s (when the batteries and charging stations weren't good enough to keep them going as consistently). They were soon joined by German manufacturer Bosch, who mastered the random-walk mowing system now most commonly used. Another German manufacturer, Gardena, made smaller, even cheaper versions for modest lawns. Do any American firms make these? I don't know. But maybe that's part of the problem, the decline of American manufacturing, especially these medium-sized manufacturers who are often the commercializers of this type of consumer tech? Because here in Northern Europe, you're going to see many of these innovative inventions hit the shelves from local, European manufacturers like Electrolux, Miele, or Philips. And those are very old, very established manufacturers, not startups. Otherwise, the devices will be East Asian imports.
It's unfortunate that mowed lawns are essentially ecological deserts, and harmful to the planet on all kinds of levels (heating, biological diversity & pollenization, flood mitigation, water purification), so it's rather a perverse "benefit" of batteries in this case, but I guess still better than polluting and noisy gas-powered mowers.
Totally agreed. But Swedes bought into the same 18th/19th Century English aristocratic pastoral ideal of the grass lawn as Americans did, and for similar reasons. Lawns are less ubiquitous here than in the US (most Swedes live in apartment co-ops, not villas/houses, and the landscape is more urban or rural rather than suburban), though, and generally smaller. Swedes are also enthusiastic gardeners, including a kitchen garden plot most anywhere where there's enough space for raised beds. Even better, it's increasingly common for people with yards to set aside or establish a flower meadow for bees.
I hope flower meadows can catch on outside of Sweden! They are wonderful. Sadly, HOAs tend to get mad if you try to do that in your suburban neighborhood in the States. :(
I live in a technology-focused city and I know a few people who have one (including our botanical garden, actually)! but I think a big part of it was that they weren't advertised. The EGO battery powered outdoor appliance commercials do NUMBERS locally--every time I walk into a local hardware store their shelf space has doubled, and I now know more homeowners who've bought into one of those systems than who haven't--but I never saw a commercial for the Husqvarna "lawn roomba" and wouldn't have known they were a product at all if I didn't have a Husq sewing machine.
The steal-ability of the "lawn roomba" is probably also a factor in America... I know our botanical garden had to replace theirs once or twice.
Yeah, that is an issue. And they're not cheap, either. So you'd be looking at replacing a $3,000+ appliance every time.
Battery-powered mowers are easily available in the US, but I haven’t seen robotic ones yet.
I've actually seen a couple of lawn Roombas, as I call them, around me in Wisconsin
Did we "miss" it, or did China just beat us fair and square? There were plenty of people in the US working on new battery tech. Just not nearly as many as in China.
It seems like we should expect this sort of thing to happen more, going forward. It's not the 20th century anymore, where the US was by far the largest country that could afford universities and wasn't bombed to rubble by WW2. China is much larger, they've got great universities and engineers, and they're going to keep on creating new technology. Hopefully we can learn from them.
Agreed. This seems to be the big takeaway... China is pretty clearly the "country of the future".
All true.
But 90% of the planet's rare earths are located in China. What business innovators would risk investment in an industry, where 90% of your feedstock is under the control of hostile rivals?
As I understand it, the causation goes the oppositie direction. the *proven reserves" of rare earths are in China because they're only country investing enough in batteries to actually care about finding them and mining them at large scale.
Don't people think that's a crazy overestimate these days?
It always was- but it has the same elite focus, government and corporate investment tradeoffs as the battery conversation. China has the majority of proven reserves and active mining site from both the commercial incentives of it being input to the supply-chain and worth ccp-points for the provincial cadre. Exploration and digging in the US probably doesn’t have the roi on a free market-basis.
Hypothesis 4
I think we missed the battery thing because we thought we had the whole energy thing licked. We would continue to drive around our gigantic, relatively low-density country in ICE vehicles. We would continue to generate electricity and transmit it to fixed location facilities. With fracking and other energy resources, we knew we had enough energy resources to maintain this pattern indefinitely. Climate change was not yet recognized as an existential problem, and besides our carbon footprint was going down through innovative conservation.
Bottom Line: Because there was no perceived necessity, there was no mother for battery innovation in the US.
Another way of asking the question is trying to figure out what necessities China faced that inspired them to create batteries as an alternative to the ICE. Currently in China, gasoline is $0.96 per litre ($3.63 per gallon) and diesel is $1.07 per liter ($4.05 per gallon). These prices are not much higher than American prices, but one must realize that China must import most of its hydrocarbon fuel, and prices would go much higher if much more of that fuel was imported.
This creates three downsides:
• A greater dependence on hydrocarbon imports would create international vulnerabilities.
• The Chinese government has a commitment to the development of its interior including many places that will never be reached by railroad.
• XI has a demonstrated a strong interest in reducing pollution in China.
Sounds like they had much more motivation than we ever did.
Watch the 2006 documentary "Who Killed the Electric Car" if you want an insight into the staunch opposition to applied battery-electric tech in the US by two key US sectors: Energy & Auto Manufacturing. In both industries, it was all about short term over long-term profits.
Big Oil/Coal is still fighting the growth of renewable electric power tooth and nail. Automakers are doing a flip; but only because consumer sentiment is forcing them to.
I'm inclined to believe the killing of the electric car actually played a disproportionately large role in slowing battery research. The scale compared to modem electronics is just orders of magnitude different. It takes something like 7000 phone batteries to get to the energy storage of a modem EV.
James Taylor, 1979, Traffic Jam:
I used to think that I was cool
Running around on fossil fuels
But now I know all I was doin'
Was running down the road to ruin.
You knew. We all knew. Don't pretend like you didn't ignore the obvious and widespread knowledge.
I wonder how much the fracking revolution of the last 15 years played into this? Why invest in batteries when you have energy abundance from other sources. The British originally started digging up coal because they ran out of forest.
I've worked in the PV and ESS industry in the US for the last 17 years and my focus for the last 7 years has been stationary energy storage systems. I think your article totally misrepresents what has been happening in the US on the ESS front for the last decade. Yes, most LFP cells are made abroad, especially in China, but the US doesn't make PV cells much domestically, either, so the real story here isn't about "innovation" but about the US's struggles to scale the production of complex, materially intensive commodities. What's more, in the next decade, the energy storage industry is likely to diversify away from LFP as the frontier commercial energy storage technology, so it's not yet clear where the industry's center of gravity will be in the 2030s, especially if China chooses war.
There are plenty of domestic companies out there focused on building energy storage *systems* and deploying them in vehicles and C&I installations, and this has been a very active area of development over the whole period in which you're saying that little has been happening. I think the issue is that *you* missed out on this development, as an observer, not that the *United States* as a whole has.
I also think you're wrong about the importance of battery-powered appliances in things like stoves. Certainly, there will be some of this, but cars and stationary batteries have far more flexibility and value to energy systems in home and businesses and across larger chunks of energy infrastructure. And there can be real downsides; for example, I don't particularly want a battery that is susceptible to thermal runaway in a stove inside my house, and why would I ever need to boil water in 40 seconds? So battery-powered appliances will remain niche products.
The real action here is not in batteries, per se, it is in the signaling systems that can control storage AND load AND generation, paired with the intelligence to optimize these controls, and the markets they operate within, to commoditize energy services. If you really want to look at where the energy industry is headed, this is the area that deserves the most attention.
Today I learned. Thanks Jeff :)
I thought that the importance of battery powered stoves would be in achieving performance similar to gas stoves in temperature and speed. How different are gas stoves from battery stoves in terms of their risks? Right now electric ranges are very inferior to gas ranges.
Two things.
First, the need for a "high-performance" stovetop seems pretty niche to me. Anybody can cook a pretty wide selection of delicious food with conventional electric stoves. You can even boil water with them! Sure, there are folks who are really into cooking or who have money and want a "luxury" stove when they decide to remodel, and there's no issue with serving that market. As far as I've seen, the well-publicized Impulse Labs product is not aimed towards the commercial market, which is probably larger for this type of thing. I would need to see some evidence that there's a lot of demand for "high performance" cooking equipment in the household market to think these appliances are going to have a significant market impact or can scale to have an impact as a demand response resource for the grid.
Yes, natural gas infrastructure in your home also can pose a hazard! And li-ion batteries are generally pretty safe; after we all them in our phones and cordless drills and so forth. I'm sure the engineers making these products have looked at this closely, but placing li-ion batteries in close proximity to a heat source raises the risk level for thermal runaway. What's more, batteries lose capacity over time and eventually need to be replaced. None of this is fatal, but it isn't appealing.
My point here is that I see Noah's enthusiasm for the revolutionary potential of battery-powered appliances as misplaced.
Thanks for the shoutout and I like this format of posing a question and collecting feedback into a longer-form blog post. A couple follow-ups:
“But it can’t easily explain why the U.S. paid insufficient attention to the technology before it was commercialized, back in the 1980s and 1990s.”
Rechargeable batteries were commercialized in the 80s and 90s - for consumer electronics like cordless phones. They weren’t commercialized for what is being envisaged today. But this is where my path dependency argument kicks in. Once they were commercialized for consumer electronics, future use cases would naturally gravitate to existing supply chains.
“Solar power: The U.S. was very early to the idea that solar power would be a replacement for fossil fuels. The Carter administration heavily promoted the technology (famously putting solar panels on the White House), more than 30 years before it became cost-competitive with fossil fuels.”
I would put solar and batteries in the same category and ask why the U.S. didn’t do more. While solar captured the imagination of some in the 70s and 80s, commercialization was really driven by niche use cases like the space industry. The U.S. never really thought strategically about pushing it to replace fossil fuels in the power grid. Germany was the first to really do that, as you note, in the mid-2000s.
I think lack of strategic push in both batteries and solar for true widescale fossil fuel replacement was in large part due to some of the other factors cited, principally the fracking revolution that recently made the U.S. energy independent again after decades of insecurity.
The solar panel companies Carter backed went bust.
The inefficient wind turbines he paid to put on the Altamont pass were terribly inefficient and ensured that some of the most lucrative locations for generation were blocked for decades with bad tech. They’ve finally been replaced.
Artificially stimulating demand and forcing consumption of uncompetitive products has a cost beyond just the government spending
Don't ignore the effect of how the bad tech stimulated mind to make good tech.
Advances in semiconductors helped drive Solar efficiency,, not Carter’s subsidies. In the case of turbines, European subsidies certainly helped to create a domestic industry, I agree
Or China's tens of billions of dollars in subsidies into renewables.
Your idea reminded me of this book by Breznitz
https://www.cbc.ca/radio/ideas/prize-winning-author-says-canada-must-fix-horrific-approach-to-innovation-1.6377569
In his book, he argues that innovation is too often confused with invention. Invention is coming up with the idea and even patenting it, while "innovation is what happens when I take those ideas and actualize them in the economy.”
Hypothesis #3 seems way too easily discounted.
Look up the documentary, "Who killed the electric car?"
From the synopsis,
"Following a strict mandate on air emissions in California, General Motors launches the EV-1 in 1997. It is an electric automobile that requires no gas, oil, muffler or brake changes and is, seemingly, the world's first perfect car. Yet six years later, GM recalls and destroys the EV-1 fleet. Filmmaker Chris Paine examines the birth and death of a revolutionary vehicle."
That's more than 10 years before the first Tesla (released in 2008). It was an American company with massive amounts of institutional knowledge.
GM killed their own innovation and the Bush administration let them.
Imagine if Raytheon had made cheap munitions drones in 2013 and then scrapped all of them in 2016 to avoid competing with the big complex Predator and Reaper drones, that would be a big part of how the US "lost " the lead in drones.
The US had electric cars by a major us company which was a great platform for iterative development, (because California did the forward thanking requirements) and the US car industry killed it while the national government gave them a high five.
To me it seems obvious that General Motors built the EV-1 purely to comply with California's mandate: that explains why they were never offered for sale (only for lease) to make it easy for GM to kill the project as soon as the mandate was repealed.
Obviously, but that still puts a lot of support for hypothesis #3.
Everyone knows the Kodak story. They invented the first digital camera and then sat on the technology in order not to harm their film business.
Imagine if they had invented digital cameras to comply with a mandate from New York State and had leased out some to photography customers. Then they killed all of those cameras when new York repealed the mandate.
We would still blame Kodak for dropping the ball and setting the US back a decade in digital photography.
Tell that to the Kodak shareholders who lost everything. Because of a rotten-ness in American management culture that shits on long-term profitability.
Same thing with GM & Ford during the EV1 era. THEY would be the global leaders right now in battery tech if not for managerial incompetence. Another massive screwing of shareholders.
How much money did they make per car? I would be genuinely shocked if they had a product that would make them rich(er) and had a better risk adjusted rate of return and then they just scrapped it because of some conspiracy. They turned down tens of billions of dollars in profits and shareholder wealth and management compensation just to keep people in other industries and the government happy? Instead of bribing politicians to make more money?
Watch the documentary.
The short answer is that the electric vehicles made money, but the value proposition was "Buy an electric car because combustion is pollution"
GM was making ads saying this, and others in GM were upset that they were stepping on their other ads for their general cars.
Essentially, the electric cars made money... But there were legitimate fears that they were cannibalizing their existing customers and the electric car ads were reaching a lot of people.
They felt that the money was more profitably spent on their existing internal combustion business.
Just like Kodak... They didn't kill the digital camera business because it wasn't profitable, they killed it because they feared it would compete with their existing profitable film business.
That just seems like bean counters making bean counter decisions. And probably the correct decision as well. EVs are a new technology, and should be made by new companies who haven’t accumulated decades (or even a century) of assumptions about how to build and sell a vehicle.
Noah, you have a misnumbering— you have a hypothesis 1, hypothesis 3, and hypothesis 3.
No analysis of the rise of China's battery industry is complete without knowing
- how BYD and CATL's precursor ATL started
- how China's industrial chain was positioned very well to benefit
- how the CCP's effective, sustained multidecadal policy push for lithium ion batteries (LIBs) ensured no other country would catch up (yet)
Wang Chuanfu founded BYD in 1995, not making cars, but consumer electronics batteries. BYD quickly caught up to the Japanese (Sony, Sanyo and Panasonic) and the Koreans (LG) in LIB cell technology and manufacturing. Back in the late 90s/early 2000s, they relied on an abundant and cheap labor force. They quickly became a supplier to Motorola, Nokia and then Apple on the iPod and various other consumer electronics products. They also invested heavily in lithium iron phosphate cells starting in the early 2000s. It's hard to say if this was independent of the commercialization efforts by A123 in the US at the time, but they either stole or reverse engineered the cell chemistry from Goodenough and Hydro Quebec's patents.
They were already a dominant force in the consumer electronics LIB industry by the mid 2000s.
Robin Zheng founded ATL in 1999. ATL was acquired in 2005 by TDK and then spun out as CATL in 2012, now the #1 battery cell and pack manufacturer in the world (BYD is #2). Zheng had also worked for TDK in China prior to founding ATL, and likely was exposed there to the rapid changes LIBs were having on the Japanese consumer electronics industry. Prior to their acquisition, they were also a leading LIB supplier to cellphone and other electronics OEMs.
Basically the two dominant LIB manufacturers globally today with over 50% market share, were already very strong in LIBs for consumer electronics by the mid 2000s, at the time the largest market for LIBs.
We also can't just look at any one industry of context of the relevant industrial chain. During the late 90s and early 2000s, China was increasingly becoming the manufacturing superpower of the world. Demand for consumer electronics was surging, Shenzhen's Shanzhai culture was doing for hardware development what Linux was doing for open source software, upstream suppliers of materials like chemicals were growing and demand for machine tools was too.
The US had none of these tailwinds.
The CCP saw the early potential of LIBs, and has used industrial policy to supercharge the industry since the 11th five year plan from 2006 to 2010. That financial and administrative support has persisted and evolved until the present day.
The US has not executed multidecadal industrial policy for a long time. But for the US to even have had a shot to be globally competitive in this industry (even just for EVs), it would have been a multidecadal effort. We need the state capacity, coordination and persistence to stand up industries like LIBs.
It's also too late for the US to grab a double digit global share of current chemistries like high nickel and manganese iron phosphate. Not to mention we lack the selection of EVs to ramp demand fast enough. No, we should be doing more to accelerate nascent promising alternate chemistries like silicon anodes, solid state electrolytes and more. They need help to cross the chasm from r&d to commercialization, and only sustained policy support will ensure these industries don't fail like A123 did.
BYD was initially a battery maker. Like other automakers in Asia, BYD manufactured other things first before taking on automotive engineering.
The Japanese automakers (and Kia in South Korea) had their origins in bicycle parts, then whole bicycles, then motorbikes, then cars.
And Hyundai had its start in auto repair, construction and infrastructure projects and shipbuilding among other industries prior to their automotive business.
Hyundai is like one of the three or four companies that owns everything in Korea.
How close are silicon anodes & solid state electrolytes to marketability?
And how much more effective/efficient (and thus, profitable) are they than the current battery paradigm?
Both are starting to ramp for automotive use cases, silicon anode in the US and semi solid state in China. Profitability will depend on unit economics at scale, which for the US is hard because of how small our EV market is vs China and even the EU.
Theres 2 Hypothesis 3's and no Hypothesis 2.
I think it mostly came down to its probably easy to copy battery chemistry and it's not really patent-able, so it was always going to be a low margin, no-moat endeavor.
Noah, Please! You would basically need an Engineering degree to understand a response short enough to fit here. Absent that, please just go talk to a good one. He/She will be able to guide you around all the pitfalls in this discussion.
There would be engineers among the readership here. I encourage you to post the short technical commentary and then the readers can translate and debate for themselves.
Ah, gasoline, ethanol, diesel,etc have been portable energy sources for a while now. And while solar is greatly improved, it's still an intermittent source for electricity.
Gasoline, ethanol, and diesel are portable but they cannot be used to store energy.
And with a battery, solar is not intermittent.
The solar cells only work when illuminated (which on earth is less than half of the time) and are thus very intermittent, the batteries only cover up for the dark times, and only for a fixed time period. The only way solar would be not intermittent were if the batteries covering for it hold enough to store more than 12 hours (near the equator, seasonally more or less in other latitudes) of the solar cell output and if all clouds ceased to exist..
No, they ARE stored energy!
They are stored energy, not a way TO store energy.
His point is that you cannot put energy into gasoline, the way you can charge a battery.
Gasoline stores solar energy from photosynthetic plants that dinosaurs digest and then died until we sucked up their decayed crude that was then converted to gasoline. It’s not an easily reproducible step, but it is storage. Companies like Carbon Engineering in Canada are creating liquid hydrocarbon fuels from just air, so it is technically possible.
https://www.nationalgeographic.com/science/article/carbon-engineering-liquid-fuel-carbon-capture-neutral-science
You did (perhaps purposefully) not mention hydrogen. It too stores and transports energy.
With much much larger losses.
That's one of several different characteristics, all of which inform the mix of applications that batteries, synthetic fuels and hydrogen are likely to end up serving, or in a few cases, competing.
I’m agnostic as long as public funds aren’t wasted on false promises.
Chin's $60bn and counting of public subsidies haven't been well spent?
A tanker of oil is definitely moving an unimaginable amount of energy through space and time. Hydrocarbons are a value chain that includes energy production and storage and transport.
I wonder if American's relative affluence, and thus early experience with battery powered devices, may have actually turned us off batteries. They didn't used to be great! We have multiple generations in the workforce who had decades of batteries dying all the time, exploding and leaking, etc etc. And they were expensive to boot--remember the old joke about "I don't know what I spent more money on, the Christmas presents or the batteries"? Anyways, sometimes being the early adopters means you form an opinion based on the shitty version of the product.
It's often the case that innovators get so good at one product they get leapfrogged by successor technologies.
It happened with Toyota, which got very good at hybrid internal combustion engines. The first generation Priuses were a money sink and had long waits until after several years they were profitable. Toyota gained expertise by making a hybrid version of just about every model, and I think they have just two plug-ins: Prius and RAV4 Prime.
Toyota (and Subaru) has an infamous flop with the first true EV, the bZ4X/Solterra, so much so that some dealers were leasing them for $150 a month (!) to get them off the lots. The EV has California compliance car specs, but have very low range and slow charge times relative to other EVs. Meanwhile, Hyundai and Kia surpassed the Japanese carmakers with EVs and plug-ins with superior range. Nissan's Ariya is the best of the Japanese EVs.
You're discounting Tesla - Tesla really was important as a first mover pioneer for showing that EVs can work, and that was a US company
Scientific progress and basic research doesn’t buy votes.
Batteries and solar are a dirty business with many of the materials and basic components easily and cheaply produced in China.
By paying rich people to buy EVs or put solar on their roof, we are essentially paying people to buy Chinese products. While Tesla is, in part, a “battery company”, it relies on China for a lot of raw materials and intermediate components.
I always thought that investing in basic research in battery tech and grid storage solutions and upgrading the grid made a lot more sense than paying rich people to buy Chinese products, but I am not a politician.
90% of the planet's rare earths come from China.
If a major discovery in, say, the Americas, lowered that number to 50%, how would that affect your calculus? Or a major battery-tech innovation that nixes the rare earths dependency?
Still don’t believe in buying votes from rich, white people. Retail solutions, like rooftop solar and EVs are foolish uses of resources, IMO. It is just some idiot pols vision of how things should be . Levy a carbon tax and let the market decide, while investing in basic research