AAH #801 - EV Batteries: Bottlenecks, Chemistry Breakthroughs, and Future Tech

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0:08Gary Vasilash: Hey, everybody. Welcome to AutoLine After Hours. Gary, we're back together again. We are. I missed you last week. I was out last week, but here we are now. We are. So do you got a quiz or should we introduce who our guests are today? Let's hold the quiz till the second half of the show. Okay. We'll do that. It'll be an easy quiz. So you guys will just knock it out of the park. We've got to let everybody know we've got Bob Galleon back on the show. He's the former chief technology officer at CATL. He worked at General Motors at one part of his career at Delco Remy, was it, Bob? Delco Remy. He worked at Magna.

0:45Gary Vasilash: I mean, you've got a strong automotive background, but especially in batteries. Yes. And so we're going to be talking about batteries today. That's why we also have Mike Anderson, the editor-in-chief of battery technology. That's great to have you back on the show too, Mike. Glad to be back. So there's a bazillion questions I have to ask you here, Bob. But so we got to get started somewhere. Here's where I'll start. What do you think? Should car companies develop batteries or should they just buy from the companies that make them? Well, it's a great question because a lot of car companies have already invested heavily in the battery technologies.

1:24And as we've seen in the change of administration going from one president to another, the car companies had to react. You can't just let a whole bunch of technologists roam the streets after you've brought them in and trained them so well. So they were very smart in diverting those engineers to do not automotive, but energy storage because the batteries are the same. And when you're storing energy in a chemical substance in a battery, it's no different. It's the same chemistry. It's just a matter of the architecture of how you build them.

1:53Gary Vasilash: Yeah, no, and I'd like to get more deeply into that, you know, the switch to energy storage. But what do you think? I mean, it seems to me that battery companies, that's all they do. They live, breathe and buy batteries. Might be the best at designing these things. Does it make sense to you at all for car companies to make that huge investment themselves? Well, General Motors did that decades ago. So, and you look back, John, at the Delco Remy division, where I hired into, what we made were lead-acid batteries. That was the world's largest battery manufacturer for decades. It wasn't until this new magical battery called lithium came along that started increasing in volume rapidly, but it was done in consumer electronic products.

2:41But to answer your question, does it make sense for these car companies to hire these battery guys? It does. if you want to do a vertical integration strategy. But that wasn't what they did in China. The Chinese decided to build individual battery companies and supply and have direct competition between the battery manufacturers and the car industry. So I guess to John's point, I mean, if you're in the business making flashlights, you don't necessarily make flashlight batteries, right? You don't have to. So you go to Duracell and they'll build you a battery and you concentrate on building the damn best maglite that exists.

3:17So why is it that car companies feel compelled that they got to do both pieces? Well, I think part of that is a cultural thing internal to the car companies that they want to have access to their own technology. They want to create their own technology and a vertical integration stack that they can utilize it to the best of their ability. Because you can build a really nice power battery, you build a nice energy battery, or you build sort of something in between, both a hybrid of energy and power type of battery for a full BEV. But that's not exactly what all the car companies have been building.

3:52They've been building a combination of BEVs, HEVs, and a mixture of all kinds of hybrids, whether it's a plug-in or not a plug-in hybrid. So there's a variety and there's an incentive for the car companies to do their own battery design so that they can integrate it into the architecture of the vehicle itself.

4:12Gary Vasilash: You know, you go back into the not-too-distant past, you know, the engine was the heart of the car. And the engine was so important. And today, it doesn't seem to be important except for hardcore enthusiasts like myself. But for 90 % of the car-buying public, they don't even know what's under the hood. Just weld the hood shut. Weld the hood shut, I mean, you know, if you can from a service standpoint. But what I'm getting at, a battery is not going to motivate a consumer to say, you know what? Boy, I'm going out. That car's got LFP or it's got LMR or it's got, you know, whatever chemistry. That's the battery.

4:49Gary Vasilash: That's not in the consumer's mind. So what I'm getting at is I don't think batteries are going to be a differentiation per se. I mean, they've got to last. They've got to charge fast and all that sort of thing. But does it make sense for an automaker? So what I'm getting at is I kind of think it makes more sense to just buy the batteries. But what I'm asking now is, does it make sense to really know what it takes to design, engineer, and manufacture batteries on the part of an OEM? So at the very least, they don't get a snow job when they're purchasing these batteries and end up paying way too much.

5:27Well, clearly, let's go back about five decades and talk about lead-acid battery again, and then we'll fast forward to where we are today. Back in the day, General Motors, Group 78 battery. Chrysler, Group 34 battery. Ford, Group 65 battery. All the Japanese companies, NS50s. So there was a very strong architecture of consistent models of batteries in the day. So those vehicle designers back then knew the package around the battery that they had to do the underhood packaging, as well as they could farm it out to 15 different battery manufacturers and get competitive pricing. Well, fast forward to today's society, well, maybe a decade ago.

6:12John Warner, dear John Warner, you know, John, big, big John, Dr. John Warner. I was the chairman of the Battery Standards Steering Committee, and I asked John to help me figure out how to write standards of the lithium batteries at that time. There were over 400 different battery designs for a lithium battery. I said, how in the hell do you make a design that is a standard with 400 different designs? We couldn't. So we put them into different packaging sizes and tried to make standards from there. But it didn't matter to the car companies. The car companies wanted a very specific design, and they designed their own batteries to fit in the packaging they knew would fit into their vehicles.

6:54And then they made the chemistry fit into that package. So it's a little bit of a reverse engineering play there, John, to be quite honest. But I'm trying to get to your question, okay? What would motivate these car companies for doing that? Well, they want to be able to build cars with their own technology and with their own chemistry. that will give them the range and the ride and the handling and the value that they think they're going to deliver to their customers. And they couldn't think of anybody better to do it than themselves. So, okay, if we're talking the 12-volt lead-acid battery that's in a vehicle, I mean, for those of us who are not battery mavens, and you are one, so that battery was designed and engineered by General Motors, not by Johnson Controls?

7:38No, back in the day, it was designed by the battery manufacturer, but they gave them a packaging size. Because lead acid had been around roughly, you know, if we go back 50 years ago, it had been around for over 100 years. Right, right. What we call secondary batteries, which means you can charge and discharge them. So those batteries have been around a long, long time. So the car companies say, we want this cold cranking performance. We want this amount of reserve capacity, but we want it to fix in this battery box with these type of terminals. because when you look at those car companies, Gary, they were quite different.

8:12You had top terminal, you had side terminal, you had a different kind of posts on them. Some were threaded and some were just a normal SAE 40 type of terminal connection that you pound the connector on at 40 below. So there's quite a difference in just the design characteristics, but it was driven by the car companies to tell the battery manufacturers what they wanted in the box. So to John's point, though, I mean, couldn't you have like 10 guys who are like really smart guys sitting in Dearborn or sitting in Warren? And they're the guys who come up with the spec and say, OK, battery manufacturer, this is what we want.

8:47Go make it instead of saying, hey, we've got the factory ourselves. I think the right answer to that is if you go back prior to the early days of lead acid, it was a wild, wild west back then. I mean, they were making batteries of all kinds. Delco Remy had one of the best libraries I've ever seen. And a lot of the research that was done with all these crazy design characteristics of batteries, but they went through the same learning curve, much like what they did until they locked in on, let's say, consumer electronic products, like a AA, a AAA of 9-volt and so on. They all went through that same learning curve.

9:23And the lead acid went through that learning curve, but the EVs went through a very tortuous path. But you look at how China did it versus the way the United States did it, it's quite different. The only one car company that survived through that was BYD. Right. Build your dreams. And they're thriving today because they did a vertical integration technology stack, much like what General Motors is trying to do in the U.S., what Ford is trying to do in the U.S. Isn't the, some of this business of the companies working with the car companies working with the battery companies, isn't it also driven by the political necessity to have a joint relationship as opposed to we're just taking this Chinese product and putting it into our car or building this Chinese, letting this Chinese factory come here.

10:19isn't that part of their calculation that they have to make now too? I don't think they had to. They just chose to. Okay. Okay. I don't think it was a must. It was a should or maybe, right, in terms of a spec. Okay. If I understood your question correctly. Nobody understands. Okay, so when we look at the big investments that the car companies have that they made in battery manufacturing capacity. And as you mentioned, they're now switching over to doing stationary storage battery type applications. Are these factories capable of making different chemistry batteries, or are they pretty much capacitized to make one type?

11:12So, for example, to go back to John's engine example, I mean, if you had a factory that made, you know, eight-cylinder engines, you're probably going to make eight-cylinder engines in that factory forever. And then you build another factory for sixes and another for fours. Is it analogous to that? Very much so. You can't really switch over a lithium-ion phosphate plant over to a sodium-ion battery, as an example. It's a radically different chemistry. You can make modifications and achieve that. You can accomplish that. It's much easier if you switch over from, say, an NMC to an LFP or vice versa.

11:48But it's still not exactly the same because there's different little minor differences in how you deal with the different chemistries.

11:56Gary Vasilash: So how hard is it to pivot from LFP EV batteries to LFP energy storage? Well, they're basically the same chemistry. It's just a matter of packaging. Let me give you an example. Most of the car manufacturers are using something like around 100 to 150 ampere-hour cell, maybe up to 200 max. But almost all the new energy storage systems, massive, what we call centralized energy storage systems, are going 300 ampere-hours plus. Before I retired, CATL, we were making 340 ampere-hour cells. Today, there's 500 to 20, 520 ampere-hour cells. These things are enormous cells. But one thing they have in common, you have to make really good quality to be able to make cells that large.

12:43Because if you make a mistake or you have a quality issue with the size of a cell like that, it's a big financial loss. How big is it? I mean, physically. Physically? Yeah. What, a 520 ampere hour cell is about that thick, about that tall, about that wide? You're saying about a bread box. It's bigger than a bread box. It's bigger than a bread box, yeah. Yeah. But I guess to put it in context, the amount of energy that you can store in these batteries is remarkable. You know, mankind has developed since the caveman using fire to keep itself warm at night up to where we are today has been a remarkable journey because we went through the transition from burning wood to burning coal to burning oil to burning gas.

13:26And now we're storing energy in batteries that's produced by any one of those fuel sources to store electrons in a battery that can then be fed back and keep us warm. So I remember about 20 years ago, I gave a presentation at the SAE show talking about what does mankind need to survive? Number one is water. Number two is food. Number three is energy. Well, we just figured out how to store energy differently over the thousands of years that man has roamed this earth. We're very, very fortunate to have that intelligence to be able to accomplish such a thing.

14:03Gary Vasilash: Bob, where do you see chemistry going? You know, not too long ago, everybody wanted NMC because it had so much energy density and everything. But it's expensive. And then especially when you get to cobalt and child mining in Africa, big issues on that. There's a pivot to LFP. Much cheaper. It's got some issues, but boy, does it work. Now we see a lot of talk about sodium batteries. General Motors and Ford both are working separately on LMR. You know, lithium manganese ritual. How do you see it evolving? Where do you think it's going? I'll answer the question more generally, John, because I see that over the last decade, there's been such a plethora of new technology developed around surface chemistry.

14:53Someday there's going to be some young whippersnapper who comes out of college who's going to figure out something new and different that we've never seen before. And this is one of the reasons that CATL started this thing called the 21C Laboratory to look at all the other elements in the periodic table because there could be lurching in the back somewhere a better technology. I'll give you an example vanadium flow batteries. It's a big deal. But their energy density is very low and cannot be used in mobility sector, but it can be used very well in energy storage sector. But very few people know about it because it hasn't really made any major breakthroughs because it is a low energy density technology.

15:36Well, if you're a very inexpensive to though, right? It's very cheap. Yeah, right. So to your point, it's a matter of what I call educational or technology bias that all these different companies have. Because if you go to a General Motors, they're using pouch. You go to most of the car companies in China, they're using Prismatic. You go to Tesla, you're using cylindrical. I call that professional bias within each of those companies because they have in their mind that that particular technology has a different edge on the other guys. So you use the word surface chemistry. What does that mean, surface chemistry?

16:15When you get down to the nano level, where you're really working at the Angstrom level, the different types of reactions that occur, the lithium battery is an intercalation chemistry. It's not a true electrochemical cell. It's an intercalation process. So the lithium ion will come in, plant itself, and kicks out a free electron for useful work. Whereas something like a lead acid battery or nickel metal hydride or a nickel zinc battery is a true electrochemical reaction. You have oxidation reduction reactions that go on. So depending upon the type of battery that you're running, in some cases there are some batteries that have both an oxidation reduction and an intercalation process going on simultaneously in the battery.

16:55So those are really unusual batteries. But what I mean by surface chemistry is when you get down to the surface of where the reactions are actually occurring and where that electron transport is occurring. That's what I mean by surface chemistry. Because that's where the rubber hits the road, so to speak, when you talk about a car. But if you have the more charge transfer carriers that you have between the foil and the active material, the greater the power density and the greater the energy density you'll have out of a battery. So it's all about surface chemistry.

17:29Gary Vasilash: You know, I talked about a whole bunch of chemistries, but, you know, right around the corner, solid state. What's your assessment of how soon it might hit mass production? We hear all these things and then semi-solid state and there's all these reports coming out of China. But we've also seen Chinese scientists at some government level add a dose of reality to say, look, we're not going to see mass production of solid state. until the next decade. And others are saying next year. So, yeah. I've heard next year for the last 10 years. Solid state is, it's real. You know, solid state batteries are good batteries, but they're damn expensive, right?

18:10Most of the solid state batteries that have been successful are sitting in satellites out in outer space right now. The reason a true solid state battery is expensive for the fundamental reason the materials and the processes that you build into it are really expensive. Now, the thing that's holding back the solid state battery is what process are you going to use to reduce the cost to a level that society will accept the cost of that battery that you're manufacturing. The materials are not that expensive. It's a matter of understanding the scientific principles and having the manufacturing processes that can do it.

18:46You keep hearing about vapor deposition processes or atomic layer deposition onto the surfaces. you hear about these anodeless batteries and so on in the solid state realm. Well, you have to have something that works in allowing the electron transport to work and the ionic transport to work because in that realm, it's solid state. Very much like the solid state that you have in electronic circuit boards. What I don't understand, though, is they got them. They work in the lab. They got them. They work on the pilot line. Why is it so hard to get to the next step? Because of manufacturing technology and the ability to make in mass quantity at a cheap and effective price.

19:31Gary Vasilash: Now, my understanding, too, is solid state batteries, much higher energy density. So you can use less battery for the same amount of range. And it doesn't need all, my understanding is, all the thermal controls and everything. So that takes cost out, too. So I've had some people say, yes, in and of itself, solid state's very expensive. But maybe once you get it into a car, you're able to offset a lot of that cost. Well, look at it from this standpoint, guys. You look at where lithium batteries were just a decade ago. They were selling at over$150 to$200 per kilowatt hour per cell. Today, you can buy lithium iron phosphate batteries in China around$60 per kilowatt hour and package it and still be effectively below$100 per kilowatt hour.

20:22So as the price point has come down on these lithium batteries, and you've got these solid state batteries that are way up here in$1 ,000 per kilowatt hour, it's going to be really hard for them to come down and compete with an existing technology that's being mass produced today. Just like any other technology, there will be a breakthrough someday that it will come down, and it will then be able to compete with the lithium-ion battery as we got in high-volume production today. So when do you think this moment will happen? Well, some people think it's tomorrow, but some people think it may be another decade or two.

20:59And what does Bob Galleon think? What do I think? Yeah. It already exists. It's just a matter of being able to develop the processes. We need to find some really smart engineers that know how to build it. And I know a few that are doing that right now, but I can't mention it on the air. It'd get me in real trouble.

21:18Gary Vasilash: Bob, talk about the necessity of actually manufacturing. Yes. Because there's a learning curve. And the more you do it, the better you get at it. It's like anything else. And this is what I've been told of why the West, and when I say the West, I'll throw Japan and South Korea into the mix, missed the big EV surge in China, which happened during COVID. You know, when nobody was traveling to China, it was all in lockdown and the like. But what somebody said to me was like, look, the Chinese have been working on this for a long time, for well over a decade. And they were getting better and better and better and better.

21:58Gary Vasilash: And then COVID hit about the same time the hockey curve, you know, rise happened in terms of yield and efficiency and all that in batteries. And he said that it was because the Chinese just kept working at this stuff that, boom, all of a sudden they got really good at it. I don't agree with that at all. You don't? Okay. No, no. I want to hear your view. Let me explain why. I like to go back and reference lead-acid battery. The best lead-acid battery on the planet was the Zargamin's plant. It's on the border of Zargamin's, France, which is right on the border of the Zar River in Germany. The best they could ever do was 14 parts per million.

22:38So fast forward to the career going to CATL, when we first started that, parts per million was not acceptable. We had to aspire to get to parts per billion. If you do the math, if you're going to mass produce batteries that are going into electric cars, the financials will kill you if you're not a very, very good manufacturer. If you're in parts per million, you might survive. But in order for you to thrive, you've got to be down on the parts per billion, meaning you've got to be really, really, really good at what you do. And that was the whole premise when we first started up that large company called CATL.

23:15The premise was to make excellent quality. From day one, we worked, worked, and worked to make every bit of the processes. So it was a very interesting story. When I retired, we had 3 ,600 control points to make a sell. Wow. When I went back to visit my friend Robin Thung, I respect him dearly. He said, Bob, we got 3 ,854 control points now. I said, good. That means we had continuous improvement in making a good sell. But most people miss this whole aspect of quality. It goes all the way back to the bill of materials. Every material that go into making a cell has to have very precise descriptions of exactly what the characteristics are that you want in it, whether it's the foil, what's the control of the foil that goes into making a cathode, what's the power structure look like, what is the distribution of the particles, whether it's an NMC or an LFB.

24:12It just depends on which one you're making. What are the binder materials? What are the specifications on all those? And then you start adding in all the processes that go into the manufacturing plant, such as the mixing, the thexicropic nature of the material that goes onto the foil, the drying process. What's the rate that you evolve the solvent out of the active material without allowing it to crack or peel off of the foil? the winding tension on the machine so that you don't stretch or break the foils or the active materials. You just go down the process and you start thinking there's thousands of control points.

24:51And the thing that has caused the biggest failures in Europe and in the United States is quality, quality, and quality. It isn't anything other than quality and the ability to control it. You don't design processes by committee. You need a guy that understands the process and is a dictator and making sure that his process works. So you have to have a whole team of dictators knowing exactly what each one of their processes has to do in order for you to make excellent quality. Come back to the U.S.

25:22Gary Vasilash: and the Europe quality problem then. Is it the quality problem of all the discrete individual materials and components going into it or the manufacturing process itself? All of them. All of it. All of it. You can't make a good battery unless you pay attention to everything. I still contend the batteries are the most difficult product that we make on the planet today. I can remember at one of the executive board meetings at the SAE meeting one day, one of the executives spoke up and says, all batteries can't be that difficult. It's not as complicated as an engine or a transmission. And before I could even open my mouth, one of the guys sitting at the head table says, you don't know what the hell you're talking about because I built batteries.

26:06And he said, this guy was, he's speaking for me, I think. He says, you don't understand how difficult it is to make an electrochemical device that stores electrons in a chemistry. So, so doesn't that make an argument then for instead of having a car company build batteries, that specialist companies, CATL companies ought to be the ones who are doing this because they're the ones who are going to have the greatest process expertise. They're the ones who are going to be looking at all these control points. Yeah. I mean. Well, that was our thought at the time at the CATL. We wanted to build batteries.

26:40And we looked at building cars and said, no, we don't want to build cars. And the reason for that is if you build a car yourself as a car manufacturer or as a battery manufacturer, none of the other car manufacturers will buy from you. Right? Right. So we took the position that we're going to make great batteries so we can sell to all the car companies. So at that time, we were selling to all the European car companies, all the Chinese car companies. And actually, we were selling to a lot of the American car companies until the geopolitics hit. And then it was all over. When you talk about the quality and how it needed to really be a part at each point and watching closely and when you were at CATL, Now, should I assume that you were using something like, because you mentioned continuous improvement, something like lean processes like Toyota, whether it was called that or not?

27:32Yeah. Well, we used all those tools. Yeah. SPC was just a part of it. And I remember I was giving a speech at one of the battery shows about four years ago. And I say, well, CHL doesn't look at just six sigma anymore. They look at nine sigma. And some guy in the back of the room said, that's bullshit. John Warner was sitting within hearing distance, and John said, you don't know what you're talking about because I've been to see what Bob's doing in China. He's right that you're using a nine sigma.

28:03Gary Vasilash: See, I always heard from the black belts that once you hit six sigma, that's your process telling you, go look for other problems because there's other bigger problems to go after. You're saying nine sigma. It's tough. Yeah. Look, guys, you're making something that is so sensitive to minor changes. You know, I look back at all the work that Jeff Dawn did years ago on the microanalysis using microkilometry up in Canada, measuring early failures in cells. And the way he did that was by monitoring and looking at minute changes in electrochemical performance behavior by using microkilometer technology.

28:43Wow. Remarkable, remarkable understanding. And guess what? A lot of battery companies around the world start buying these micro-Colombic cycling machines so they can start looking for that because they got a better peer into the world of micro processes of chemistry exchange, you know, making the electron exchange more effective.

29:08Gary Vasilash: You know, you say in that, turn to the thought, you know, we've had Alan Taub here. He was the former head of R &D at General Motors. Now he's running the battery lab at the University of Michigan. He's got his researchers trying to literally watch electrons move inside the cells. Yeah. So, and their thinking is, if you can start monitoring that, you can start designing better cells. Well, there's a lot of universities today that do have those kind of transmission electron microscopes. They call this in-situ transmission electron microscopes where you can actually watch those processes. University of Alabama's got this.

29:46They got the world's largest transmission electron microscope in Alabama. It's a big beast, but it's an amazing machine. They can literally go in and look at the atomic level. Wow.

29:56Gary Vasilash: Look, we got to take a quick break for our sponsor message here that helps pay for the show. Let's do that. And then we got a lot more to talk about. Absolutely. Okay.

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30:22Gary Vasilash: Thank you for your support, Bridgestone. We love it. So, Gary, you had a quiz first. Yes. Okay, so today's July 30th. July 30th, 1990. a fairly important vehicle was launched. You all know what it is. What was it? I think I know. You guys want to guess? I have no idea if I'm even close, but I would say the Tesla Roadster. It's a good guess, but you're wrong. As usual. When you say 1990... As in 1990. 1990. So there's only two important launches as I can think of around that time. One was Lexus, but I believe that was 1989. You've got to be talking Saturn. Bob's shaking his head no. That was about the time that General Motors actually announced the impact, which was the original EV.

31:22I started working on the impact in 1989 as the first engineer assigned by General Motors to work with Paul McCready on designing the battery pack that went into the impact. And that's around the time that the first public announcement was made, General Motors were working on the electric car. John's right. Okay. So the first SL2 was built by General Motors on July 30th. It was interesting. So I was interested, like, you know, what happened to Saturn, right? I mean, as a result of the bankruptcy were dissolved. What I didn't know is that Roger Penske wanted to buy the brand name Saturn. He didn't want to buy any of the factory capacity, but he was going to keep the 350 Saturn dealerships that had been vetted.

32:15So what it was was that Penske was going to have Renault, through its Renault-Samsung operation in Korea, provide Saturn vehicles. And that's where Saturn vehicles come from. Wow. But then the Renault board said, you know what? Selling cars in the United States in 2009 isn't a very good idea. You know, we've got this deal with Nissan going. So we're not going to let that happen. So the Renault board basically nixed. Huh? Oh, interesting. We're doing that. Wow. Wow. Good stuff. Good stuff. Good stuff. Yeah. Yeah. So remember those those ads when they're just, you know, here's we're a different kind of company and here's our happy workers.

33:00You know, we're all planting gardens together. And yeah. Gone now.

33:04Gary Vasilash: OK, back to batteries. China dominates the scene. Japan's got some good battery stuff. South Korea does. We're trying to build a battery infrastructure in the United States. We got going under the Biden administration, the Trump administration sort of kicked the legs out from under all that stuff. But progress is still being made. What do you think that the United States needs to do? Because this goes beyond the automotive industry. As you know, it touches electronics. It touches aerospace. It touches national defense. The electric grid. Yeah. Yeah. Well, we've been working on this in the background, both at NatBat, SAE.

33:46What's NatBat? Oh, and that bad is the North American Advanced Battery Technology Group that is composed of about 285 companies that are working in battery technology. We all have roughly 18 committees within that bad that covers almost every aspect, everything from policy to safety, shipping, transportation, and that kind of thing. So we've got 18 different committees. But the one thing that we need to do is educate and train people. As you guys know, the skill sets required to make a battery is an immense task. You've got electrochemistry. You've got electrical engineering. You've got mechanical engineering, packaging engineering.

34:30The amount of scientific principle behind this, you've got chemists, physicists, and so on that build all these different high degree molecules. So you have to build a supply chain network to support batteries. That was the most difficult thing that most societies have is building the supply chain to make battery materials and support the manufacturing. The biggest hurdle that we've got in this country right now isn't the lack of technology. It's a lack of manufacturing. We don't know how to build a machine to build a battery. And that is a tough thing to crack. We've really got to reestablish manufacturing competency in this country in order for us to have the ability to make batteries ourselves.

35:14Today, we're totally reliant on buying equipment from Japan, Korea, or China to build batteries in the United States. Do you see any progress being made in that regard? Not a lot. Disappointing. Yeah, that's very discouraging. One might make the argument, though, that if I want to make a new combustion engine, I've got to buy the technology from Japan or Germany or somewhere else, and that it's not indigenous United States. I mean, Mike, you know that. Absolutely. You know that the machine tool industry ain't what it used to be. Well, that's right. You mentioned battery-making equipment. I mean, manufacturing equipment in general is almost all coming from Asia or Germany.

35:57You know, there's exceptions. Our friends at Haas, you know, but most of them are also coming from overseas. So it's a big problem. It's probably a bigger problem for the battery industry because there's so much politics involved now and protection and so on. It's got to be hard for battery companies in the U.S. field they need to learn. And we talk about this at the battery show all the time, you know, that you want to learn from people who are doing it already. There's got to be a way that you can learn from them without giving away your personal farm and fortune, right? Well, there's a famous slide.

36:42I don't remember the guy's name that put it together, but it showed a slide at the battery show last year. The manufacturing capacity of the United States back during World War II. And from World War II to today, it's gone almost to zero in terms of manufacturing equipment competency. That's right.

37:02Gary Vasilash: But sticking with batteries, what kind of policies would you recommend that the United States follow to build up its own battery manufacturing infrastructure? Because, like I said, it touches on so many industries and globalism is dead. We're all back to regionalism. and that's critically important for the U.S. to be able to do it on its own. Well, in order to learn on your own, it's going to take a couple of decades, to be quite honest, John, because the technology that the Chinese has developed didn't happen overnight. A lot of people thought that there was some kind of a master plan that the Chinese government had implemented to put batteries at the forefront and make it an overwhelming technological advancement over the rest of the world.

37:46That wasn't the case. You have to go back 30 years ago when the entire world were sending all their consumer electronic product requirements to China because they made it more cost-effectively. Well, the Chinese learned really quick that you cannot make consumer electronic technology without a battery. In order to make a battery, you needed raw materials. To get those raw materials, you had to go build processing, and then you had to go find sources of where those raw materials would come from. So over a period of two to three decades, China created an infrastructure. They didn't build it overnight.

38:23In order for them to be able to build the sophisticated batteries that Apple put in their original Apple cell phones was remarkable. And all they did was build upon that competency for the next decade until I showed up on the scene and I realized, wow, these guys have really got their act together. They're doing all the things that are necessary to build a superb network of battery manufacturing. And they did. And all they did was just take off from there. You know, Bob, John mentioned solid state batteries. And so I did a little homework before you came in. And I was looking at, and Mike probably knows this in his sleep, the types of other chemistries that are on the horizon or were on the cusp of them.

39:10Sodium ion batteries, lithium sulfur batteries, lithium air batteries, lithium oxygen batteries, silicon anode batteries. Okay, so those are the ones that are coming. And the ones we have now, the NMC, NCA, LFP, LMFP. Now, the auto industry historically has been nothing but a monoculture, right? We made combustion engines and we made a lot of them. We made them damn good. And when I look at all of these different types of chemistries, I wonder, how does the auto industry get its arms around making the right choice of the one it will take in build and volume? That's a really difficult question because there have been thousands of people working on that If I had my choice to work on a single battery technology, it would be a metal air battery The fundamental reason that if mankind is going to survive we have to have air And if a battery runs off of air, that's really a good thing The big problem is the reversibility Reversible reactions of batteries is really important because you've got to be able to discharge it, you've got to charge it, right, make it useful.

40:24Most metal air batteries do not cycle very well at all. So this gets back to the question that John asked earlier about different battery technologies. Metal air batteries is totally on surface chemistry. It's about how to exchange electrons with air in the battery and make it a reversible reaction. So I'm not sure I answered your question directly, but indirectly, metal air batteries will be the best battery that you can make because it gives you the cheapest and most cost-effective because air is pretty cheap. Without air, we won't be around very long.

41:01Gary Vasilash: We won't need batteries. We won't need batteries. So Gary, I hope I answered your question. That's right. Talk about some of the packaging then. You know, we've heard of cell-to-pack, cell-to-chassis, you know, how do you see that going? Well, John, it was an evolutionary process. We started out originally with a cell-to-module because it was, it's kind of like growing your child into a teenager, you know. You take a batter or cell and you put it into something that's packaging and it protects it. And then we got a little smarter because our packaging density was below around 60 % volumetric packaging.

41:43That's because there's a lot of dead air and a lot of packaging around that kind of architecture. But when we started thinking, well, we need to do a cell-to-pack concept, which was remarkably improved the packing density above 80%, 80 % to 85 % packing density. That's pretty good. And what does that do that gives you more energy per unit volume that you can put into a mobile application? And it gives you a lot better packaging for putting it into an energy storage application. Like if you wanted to put a battery in a particular barn for energy storage for, say, a data center or something like that.

42:20Then the smart idea came along. Well, if we're so good at doing packaging like that, let's go directly from cell to chassis. A cell-to-chassis creates a whole new paradigm for most battery manufacturers. If you're going to do a cell-to-chassis, you've got to have excellent quality, primarily because once it's put into the belly of the vehicle, you can't get to it. It's almost impossible to access to do any service on it. So you better have really, really good quality. Your parts-per-billion story. Your parts-per-billion, exactly. And this is why some car companies or some battery manufacturers today are offering a cell-to-chassis concept.

42:57So if you paint the paradigm of I can make chassis A, B, C, and D, and each one of those chassis could have an NMC or an LFP or a mix of two different battery technologies because that's fully capable of today's electronics. So now you've got at least with four different chassis, you could have up to almost 256 different designs, if you will, of technologies just because you could put in different types of cell chemistry and a combination thereof with a battery management system. So now the car company, all they have to do is say, well, I'm going to buy chassis A, B, C, or D, put my body panels on it, put a set of wheels on it, put your infotainment system on there, your ride and handling package.

43:39and all of a sudden you got a vehicle, but you didn't have to invest in either the battery technology line or the chassis line. I hate to say it, but I'm predicting that this concept is going to overwhelm the rest of the car industry, trying to beat the rest of us to the punch. I think that this sell-to-chassis concept will decimate some of the other car companies. I'm not going to mention car names or platform names, But when you are offered an opportunity to have something like that, it totally changes your concept of what a car is and how it's built. It's now basically build to print. So do you think car companies would have the confidence that they would say, you know what, this very, very, very expensive part of the vehicle is basically going to work and it better work all the time because if something goes wrong inside it.

44:34I think it will. It's happening in China right now. Yeah, we'll see. In a couple of years, we'll see how well the Seltichessie concept is adopted across China.

44:43Gary Vasilash: Now, here's one question. Recycling. And the reason I bring it up is not far down the road from the studio here is a battery recycling company, Serba. And I went and visited them, and they were taking apart a battery pack. And I mean, they literally had chisels and mallets and crowbars. And then once they got the top off, it's full of all this gunk, you know, flame retardant, essentially. And their one message to me was, John, if you report on anything, ask those car companies to make it a lot easier to recycle these things. So when you go to sell the chassis, how the hell do you recycle this stuff?

45:21Great question. Just literally this week, I got an email from a company in Germany that's doing exactly what you're asking. They're using robotics to disassemble battery packs. And once you train the robot's system, that is, that particular design, they can bring in thousands of them and they can disassemble them very quickly. But you've got to train the robot on the first one on how to disassemble it. Because some of the methodologies that we're using here in the United States may not be the best. Chisel and hammer is not the best thing to be beating on a battery package at 400 volts. But we're learning how to discharge the batteries to a point where we can safely disassemble them without people getting hurt or loss of asset.

46:04You short circuit a battery pack, it's a 400 volt or above. It's a pretty big arc flash. And it creates a lot of damage to whatever it is that got across the terminals. You certainly want to make sure that you've discharged the system well before you start doing the disassembling. And they do. And the robotic approach, I think, is the right answer to that question, because if you know what the design is, which means it's nothing more than uploading to that company the design layout, now you train the robot, you instantly go in and start disassembling. So I'm not trying to be disrespectful to some of our colleagues here in the United States because I just gave the opening speech at the recycling conference here just a couple of weeks ago about where we need to be going with this technology.

46:55But it is very important to us because lead acid batteries are over 99 % recycled.

47:00Gary Vasilash: In fact, I was told by Clarios, which has got the old GM battery and Johnson Controls battery business, that the lead in your lead acid battery in your car can be up to 60 years old if they've been recycling it that long. The same thing will happen in the lithium industry eventually. It's already happening in China. They've got a great. Here's another question. And this comes right out of my visits to the battery recycling center. They said, oh, NMC, we love NMC. Yes. You know, and I'll make up numbers. I don't know the exact one. But if it's a$10 ,000 battery pack, When you go to recycle it, there's probably$8 ,000 worth of valuable material in it.

47:38Gary Vasilash: But they said LFP, meh, there's no money in it. It depends on the company, John. I happen to sit on the board of directors. I got to be careful not to mention names. But I sit on the board of directors for a company that loves a lithium iron phosphate battery because as long as lithium is above about$7 to$10 per kilogram, we're going to make money off of it because we know how to recycle the lithium. Now, no disrespect meant to my other colleagues, and this is a part of these TV shows, you're going to create some controversy, right? And I don't mind controversy. I've lived with that for many years in batteries.

48:14But I can tell you, you can make money off of recycling lithium iron phosphate.

48:18Gary Vasilash: I'm so pleased to hear that because, you know, that was part of my fear. Here's the industry pivoting to LFP. But if there was no money in it, you know, these batteries are just going to stack up. in the landfills. So I'm glad to hear that you can make money on it. A lot of it has to do with the technology that you put into disassembling and deconstructing the cell and the system. Because around the cells, you've got a lot of aluminum. I mean, most of these guys are using lightweight aluminum space frames to package because it's lightweight. That aluminum is worth something. The guys down in Australia that want to make HPA, hey, the high-purified alumina from Lava Blue, these guys would love to have all that aluminum.

49:03And they're saying, I want a piece of that. Because then they can take that and make the high-purity alumina that goes back into the separator coatings that are used in short prevention in the battery. So there's different aspects and different approaches that are used and different technologies that are used in recovering these precious minerals. We're used to talking about design for manufacturing is a big part of the automotive industry. And I suppose that it's going to come to design for disassembly as well. It's a matter of maturity, Mike. It's just a matter of time before all the car companies and all the battery manufacturers realize, in order for us to get the maximum recovery of those precious minerals, whether it's aluminum or the copper, some of the companies are now trying to salvage the electrolyte, the solvents coming out of the batteries.

49:52Why do you want to just burn those off and loot the air more and just recover the solvent, run that through a still and get the ethyl and methyl carbon mates back out of the electrolyte and reuse them again. So there's a lot of different technologies that are being developed to do exactly, to your point, how you get the maximum recovery. Yeah.

50:13Gary Vasilash: Design for disassembly and repair is something that the industry really needs to pay attention to. Anyone who's tried to change spark plugs or oil filters or cabin filters would know even the basics can be really difficult to do. Right. And that gets back to the education and training of the workforce, too. You're going to train some guy out in the shop to work on an 800-volt battery. It's special training. It's a highly specialized training as well as the electronics. You have to interrogate with a complicated device like the battery management system and looking at each of the cells in there and say, well, this cell's way out of balance.

50:50How do I get it back into balance? or, oh, this thing's got a catastrophic failure imminent. It's going to happen. Get the car out of the building, right? So there's a lot of different education or training processes to do the kind of sophisticated repair work that you're talking about. These are not a simple change out of a valve lifter or something. So, Bob, the U.S.

51:16industry, auto industry, in terms of making electric vehicles, I mean, it's going up. And as John mentioned, it's now going way down. What does that do in terms of the car companies feeling good about investing in advanced battery technology, to say nothing of design for assembly and design for repair and things like that? I mean, is it going to be a situation where they're now going to be behind the rest of the world? I mean, Europe's got over 20 % EV purchases. China's 50%. We're below 10%. We're already behind, and we're going to get further behind with the present approach that's being taken in this country.

52:02Because regardless of what we want to say, it's anywhere from 18 % to 24 % compounded annual growth rate in EVs around the world outside of the United States. We're the ones that are dragging the curve down. And it's actually not beneficial to our country because it puts us further behind. Batteries is an essential part of society today. Just about everything we touch or feel today that gives us the creature comforts we have is powered by battery, whether it's the thermostat on your wall at home or whether it's the cell phone you carry in your pocket or whether it's the electric vehicle battery that's in your car or it's the car battery that starts the engine that you're driving, right?

52:40Batteries are damn near everything that we're running, including the cameras that we're being recorded on today. It's really an important point that you're making here is that it's putting the United States behind, not just in electric vehicles, but we're getting behind in all the other areas of competency. When you talk to our military, almost everything they use in the battlefield has got a battery in it. And Senator Cotton, he corrected me a year before last at the Benchmark Mineral Intelligence Conference when I said, oh, the warfighter carries 19 pounds in his backpack of batteries. He says, no, Bob, it's 21 pounds.

53:19He says, no, no, I didn't.

53:21Gary Vasilash: This is something you told me earlier, and I want you to go through that again. When the U.S. military drops each and every one of our warfighters into a combat zone, they have 21 pounds of batteries. night vision communications i'm not sure what all else exciting systems and where do those batteries come from exactly today most of them are coming from china and if they don't come from china the materials that was used to make them was probably processed in china correct right so i mean this is what i when i brought up national security before that to me this is a a critical issue. And it's very discouraging to hear you talk about how far behind we are and falling farther.

54:04So my position on this, and I've been very consistent on this, if you go back and listen to some of my public speaking, it's about what is wrong with another country having a better technology than the United States? Let's learn from them. Yes. Right. We make great aircraft carriers. We make great fighter jets. We make great everything, medicines and everything in this country, but we've fallen behind in battery technology. So why don't we use the model that worked? China built a fantastic model. Why don't we follow what they did? There's nothing disrespectful or it's not a threat to our national security to learn from another nation that makes something better than we do.

54:46Are we so damned arrogant that we think that we got to make everything better than everybody else? That's one of the things I learned from the Chinese. They're very humble people, even though their government may have a different attitude about that. I look at it from the standpoint that these people could teach us a lot about making great batteries. Yeah.

55:04Gary Vasilash: You know, Jim Farley and Ford have taken a lot of heat for working jointly with CATL to build batteries here in Michigan. Right. My whole counter to that argument has been, look, if we want to catch up to and maybe surpass the Chinese at some point, what better way than to get them to help us do it? Right. Yes. You know, I look back and I like to study World War II because I had an uncle that was an army ranger and he was in a lot of battles. He survived. He was really messed up from breast syndrome, post-traumatic stress syndrome. I get a little emotional about it because he was such a warfighter.

55:47He was a national hero. He had seven bronze stars and two purple hearts when he died. I look back at what he had to deal with with the military armament that he had to fight with. It was a knife and a bayonet and a gun. Today, when you talk to our warfighters, such as Navy SEALs, almost everything they've got that they take to the battlefield with them has a battery in it. Their healthcare monitoring system, short-range telecommunication, long-range communication, night vision systems, sighting systems on their rifles. I mean, these guys have got batteries everywhere. And they say if they have a failure in a battery in the battlefield, it can cost them their lives and their team's lives.

56:29because the type of warfare that we have today is quite different than we had back in World War II. We have to recognize that we as a society must be able to deliver to our military the kind of things that they need for national security. If you go back and listen to some of the comments I make in my public speaking, national sovereignty is a big deal for every nation. And in order for every nation to have its own sovereignty, You need to have the materials and the technology to be able to defend yourself in case one of the other countries gets riled up against you. And that's one of our biggest concerns today.

57:04If China cut us off in batteries, we'd be in a world of hurt. So, Bob, is it automotive batteries that really matter or are the other devices that have batteries? It's more about the other devices, to be quite honest. if we got cut off on automotive, which we already have been. It hadn't hurt us that bad because we're producing gasoline cars, but it's the whole concept of the infrastructure and the technology that's built around the battery systems that is the most important thing for me because we use batteries for everything. How many of the cruise missiles have a battery in it? Every one. How many of the smart bombs we drop?

57:45Everything we have today, including this watch, it's ringing. Sorry, I didn't turn that off, guys. Everything we have today in our military, just about everything has a battery in it, some way, shape, or form. And that's a part of our national defense structure, and we need to correct that. But the driving force behind what goes into our military is what happens in the laboratories at the universities and in the laboratories at the industrial level. Our industrial network today needs to build a more robust system based on education and training from our colleges. And that's one of the things that we're trying to do in the professional societies like NatBat and SAE to build up that education and training program because we have a lot of people to train.

58:31Go ahead. Let's just follow up on this. So, I mean, is Apple's use of batteries more important to the nation than General Motors' use of batteries?

58:47That's a great question, Gary, because the cell phones has become such an integral part of our social life and how we deal with managing our own families. There's not a day that goes by that we don't call our wives or our children or check on our children on what they're doing and why are they doing it. So I think the communication part of it is probably one of the most important parts of the structure of our social structure around the world. It's not just U.S. You go to Germany, France, Spain, Germany, I mean, China, Japan, Korea, everybody lives by cell phones today, right? It is an integral part of our lives, and it's powered by a battery.

59:32Now, is that more important than a car battery? Maybe so, but we also need the car batteries because in the future, we'll have a better society running off electricity, and it's okay because, guess what? We know how to make polymeric batteries today made from oil. We can take, there's this really nice little company out in California that makes polymeric batteries called Linova. They can take a polymeric material from oil and build a great cathode. The rest of the world just haven't discovered it yet. Once they figure out, and if I could get a message to President Trump, I'd say, we can build batteries from oil.

1:00:15Drill, baby, drill. And he can keep drilling all he wants because I can make batteries from that oil because we just convert that oil into a polymeric substrate, And then we especially treat that polymer to put the functional groups on there that traps the lithium or the sodium. That gives us the intercalation process. It gives us the free electrons for useful work. We just have to have the infrastructure, the grid infrastructure, in order to build that. My prediction of the future that we're going to go back to nuclear big time, and I think it's going to be distributed small nuclear reactors to power our country for a fundamental reason.

1:00:51our country has an old and dilapidated grid structure. That's true. And the stepping stone to get to that nuclear is batteries. Because we can take a bunch of batteries today and put them out there on the grid. We don't have to increase the amount of energy we generate today because we already have the amount of energy we need. We just need to store it so we can use it at the right time. Storage is the answer to the problems that we have on the grid today. But in the future, more generation is required to keep up with what's going on in the world of AI and data centers. These things are enormous energy producers.

1:01:31I mean, consumers. And we need to generate. In fact, the United States government is saying now, if you're going to put a data center in, you've got to put a generation capacity to match that so that you can keep up and you don't drop the grid out. You don't think renewables, wind and solar, can match nuclear? No, they can't. They just can't keep up with it. Now, are they good? Yeah. This is a funny thing. China's proven that they can make wind and solar work. They know how to do that, and they do a more remarkable job. I took a friend of mine from Duke Energy to a place called Gurumu out in the western region of China, And I asked the guy, how much generation capacity do you have between wind and solar?

1:02:15He says, oh, this one's just two terawatts. I go, what? Two terawatts. So the point here, Mike, is that we've got technologies. We've got choices. Now, which one is the right choice? The one that I think we're really missing is wave technology. Oh, yeah. Every cycle of the moon going around the Earth. Ocean wave technology. There's enormous amounts of energy and tide generation that could be made, which is very similar to the kinds of energy that you're going to have out of a nuclear reactor if you know how to generate and store. So I think there's a lot of different technology out there, guys, that we can change the world with, but we haven't discovered it yet.

1:03:01Gary Vasilash: Bob, unfortunately, we're going to have to wrap this up. It's been fascinating having you on the show here. Thanks for coming back. Really appreciate your time. Mike Anderson, good to have you back. Yeah, glad to be back. Gary, good to be back in the seat here with you. And next week you'll be gone. And next week I'll be gone. That's right. Anyway, I want to thank all of you for having tuned in. AutoLine After Hours is brought to you by Bridgestone Tires. Solutions for your journey.