ICYMI: The Race to Roll Out Solid-State Batteries

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1:56don't stay you. Visit vitalproteins.com to learn more and where to buy. These statements have not been evaluated by the Food and Drug Administration. This product is not intended to diagnose, treat, cure, or prevent any disease. Bloomberg Audio Studios. Podcasts. Radio. News. You're listening to Bloomberg Businessweek with Carol Masser and Tim Stenevek on Bloomberg Radio. Well, speaking of technology, I want to bring in Si Huang. She's founder and CEO of Factorial Energy. She's been on our program before. Factorial is a company that's working on solid state batteries. It's partnered with automotive manufacturers, including Mercedes-Benz, Stellantis, Hyundai, and more.

2:36She joins us once again from Massachusetts. Si, good to have you back with us. We're going to get to what you're doing at the firm and how these batteries are different at Factorial Energy in just a minute. But I do want you to weigh in on this evolved industrial policy, if we can even call it that, that we're seeing from this administration. It comes after the Department of Defense's promised$400 million to MP Materials, the supplier of and processor of rare earth materials. We spoke to Jim Latinsky, the CEO of that company. It comes after the news this week of AMD and NVIDIA sharing some of their Chinese revenue with the U.S.

3:16government. and it comes after the golden share deal for U.S. Steel. How do you think about this as the founder of a tech firm? Yeah, I think the global competition on technology is precedented. And this is a really good time for technology development, but also we have to be aware of the geopolitical tensions around it. And as factorial, I think we have been laser focused on our key customers, like as you just mentioned, Mercedes, Stellantis, Hyundai, and Kia. And those are global partners for us. It's been across multiple continents. And of course, they have a great presence in the U.S. as well.

3:52For us, I think our focus is not only about our diversified global customer portfolio, but also diversified supply chain, which is critical here today. And we're excited to hear that DOE actually announced a program yesterday about supporting battery-related material as well as battery manufacturing as well. It's been quite a while since we had you on the program. It was before, I believe, we heard a lot about what the Trump administration's plans were for industrial policy and the way that the administration is thinking about EVs, the way it's thinking about batteries, its relationship and deterioration there.

4:31So with Elon Musk, and it's also before tariffs. And I'm wondering from a supply chain perspective, given what goes into solid state batteries, how your supply chain has been affected by tariff policy? Yeah, so I would say there has been a lot of discussions about the rare earth metals recently, how U.S. is securing that. Fortunately, battery doesn't really have those rare earth metals. and between lithium cobalt and nickel, those are critical for lithium-ion batteries, but they're actually transition metals. And especially for factorial, we're not using LLP, which is also a critical material that has been quite constrained from the China market.

5:14And also we don't use that as well. So I think to that extent, we have been very well protected from the global supply chain constraints. But also, we also want to be aware of the potential threats coming up. Right now, we actually have been actively working on not only just to work with direct suppliers and building the supply chain coalition, but also working with recycling partners. You know, recently, we announced this partnership with a Korean conglomerate called Sunggyu. And they're one of the largest recyclers in the space, not only for lithium-ion batteries, but they have done a lot for solid-state battery as well.

5:55So I think that's actually going to deeply protect us with a closed-loop supply chain in the future, especially when a company is at scale. Forgive me. Solid-state batteries, what exactly are they? I feel like we so often talk about EV batteries and what's going on. We throw terms around. But what exactly is a solid-state battery? which is your bread and butter, correct? Yes, yes, exactly, Carol. And I would say solid-state battery is like a traditional battery, but instead of using a liquid electrolyte, it uses solid or quasi-solid-state material, which means you combine a little bit of solid and a little bit of liquid together.

6:33But the solid content will stabilize the cell dramatically, and this makes the battery safer, longer-lasting, and more powerful because it can store more energy and it's less likely to leak or catch on fire. And as you know, like the biggest market for batteries on transportation, but actually batteries not only limited to transportation, it is in the air, it's on the water, it's in the robotics, and it's also everywhere for energy storage for homes and businesses. So it's fundamentally infrastructure, technology, and product, rather than something very narrowly sculpting, a very specific application.

7:15And we mentioned that, as Tim said earlier, that you partnered with automotive manufacturers, including Mercedes-Benz, Stellantis, Hyundai. I'm just curious, so you guys are working together. Is there actually products on the market? Give us an idea of kind of where you guys are in this process. Yeah, that's a great question. You know, we started the collaboration with those companies many years ago, and Hyundai Honda and Kia were our first investors in the company, and Mercedes and Stellantis led our$200 million round in 2022. And since then, the company has gone a long way for product development.

7:48We launched the first 100 m-powered solid-state battery with Stellantis in CES under their keynote speech. It was very well received. Since then, we have shipped thousands of batteries to our global OEM partners. As of mid of last year, we launched the first B-sample to Mercedes, which also marked the first B-sample shipment to a global automotive globally for a solid-state battery company, which is quite a breakthrough. And with that B-sample, we actually were able to build the first vehicle together with Mercedes earlier this year and has the first vehicle rolling on the street in Stuttgart.

8:25And that also marked the first electric vehicle that's been built by a solid state battery. And it's not only the first application, a debut for a solid state battery in a vehicle, but it's also in the broader e-mobility sector as well. And what is even more exciting is that recently, not only with this automotive, but we also have a major breakthrough with the first shipment to a drone maker in North America. So that's going to be a very important near term application for this technology at a small scale. A couple of quick questions. So wait, go back to, and I think you talked about this in terms of, you know, batteries, part of the problems, I mean, EVs, yay, like people like them, but then there's the batteries, right?

9:05That, you know, the waste and what happens with batteries, because you kind of can't do much with them. So I'm just curious about what happens with these batteries after they don't work. What's the kind of, I don't know, recycling abilities or capabilities? Just give us an update on that. Yeah, recycling is definitely a very important part to close the loop. And not only just from the circular economy perspective, but it's important for the cost and supply chain resilience in the future. And I think in the near term, what we see is that a lot of the battery recycling is coming to two pieces. One is for the scrapping of the battery and the vehicle as a whole.

9:45And number two is about using those scrap materials to turn that into a black meth and from the black meth to refine that into the raw materials and turning back to the battery again. So that's the recycling process that most of the recyclers have been adopting globally. And that's why we have been very aggressively working with actually two Korean recyclers right now. And both have a strong presence in the U.S. like SunGil and Yangpu. That's the one we actually announced last year in front of SunGil. What is more important that I think we also need more presence in the U.S. for solid state battery recycling in the future, which will become a mainstream for our energy storage and e-mobility.

10:30So yeah, we're actually working very closely with one of the U.S. recyclers today to increase and enhance our recycling capabilities in the U.S. we're speaking with siu wong she's founder and ceo of factorial she has a phd in chemistry but i'm still trying to understand what how to build a battery myself she knows how to do it well what's interesting is you sound like you're making progress um and you talk about the first vehicle with mercedes um and the first shipment uh to i think it was a drill company i think in the u.s forgive me if i didn't hear it correctly yeah a drone company so that will probably be the first application is actually not only for commercial, but also defense applications for batteries.

11:15So how do you ramp up? When do you ramp up? So it sounds like you're still kind of finding your way forward. So when is there a mass production point that makes you a viable, financially viable company going forward? Yeah. So we are actually having another fleet coming up from the first vehicle. So as we announced with Mercedes for the first vehicle this year, which we built and delivered already, we're actually announcing with a fleet coming up in 2026 with Stellantis. We just announced a major milestone that both companies achieved last month to deliver this 2026 fleet that's led by Dodge Charger Daytona.

12:00And it's not only just for Dodge, but it's also spent across the stellar large platform, which including Jeep, Chrysler, Alfa Romeo and Maserati. And so with the fleeting 26, we're looking at 27 for the first commercial deployment. And as early as 28 or 29, that we can see the scale coming up for this market. But even before that, we may say like drone market and some of the defense applications may come even ahead of 2027. All right, we're going to leave it on that note. Listen, so good to check in with you and hear some of the progress that you've made. Look forward to hearing more in the future.

12:38Si Young Wong, she is founder and CEO of Factorial Energy, joining us from Massachusetts. When you're running a business, the best days are the ones where priorities stay on track. For midsize and large companies, risk can affect multiple parts of the organization at once, from property and liability to cyber and regulatory challenges. At that level, managing risk becomes an ongoing discipline. At the Hartford, the focus is on helping businesses manage risk before it turns into something more disruptive. And when losses do happen, that work is paired with insurance coverage shaped by years of underwriting, risk engineering, and claims experience.

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