Why are LiFePO4 costs still high?

liveforphysics said:

I have an analogy for this thread.

I'm riding in a plane flying along enjoying the ride. Plane rides are a normal accepted thing. While flying along you hear people yelling up to you to let you know planes can't fly. Or that they only fly in your area because it's got special air.

I'm sure Justin feels the same every time someone tells him he can't run a successful business with only a cargo - bicycle.

The sooner you direct your efforts towards looking at reasons EVs can work rather than won't work, your area will also get to stop getting around in carcinogenic fartboxes.

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Only one problem you refuse to address--unfortunately it's a major one. Nobody--NOBODY--has ever managed to make money selling passenger EV's. Not Nissan, not GM, not even Tesla. There are some fantastic EV's out there, but the really good ones are still very expensive despite the fact that they are all being sold at a loss. Much of this is chicken-and-egg economies of scale at this point. That is to say, for example, that A123's cell price is high because there are so few customers, but the reason there are so few customers is because the cell price is so high. Part of it is government--another "big ship" to steer--but just as significant is consumer culture (which has sadly been contaminated with mythological politics, at least here in the US), and perhaps most importantly, the skills of the engineering community at large. It takes several years to develop the collective engineering know-how to facilitate a paradigm shift as significant as the one we are talking about here. It is happening, but the pace is maddeningly slow. Trust me, the OEM's ARE NOT ready to just flip a switch, even if the world were already crackling with charging infrastructure they couldn't do it. I feel your pain, I can't wait to get this moving either, but there are limits to the speed with which it can be done. This is no longer about EV's "working", it's about the speed with which the wheels of large scaleindustry adapt to change.

A123 tried to wait out the market changes that would make them profitable as a company focusing mostly on HV applications. The industry simply doesn't move fast enough to facilitate that kind of change. Had the government subsidies been allowed more realistic timelines, it may have been different. Same for Fisker (who, BTW has also been revived by Wanxiang). But it's as though the timelines are shaved to unrealistic durations by design. The Democrats get to take credit for passing their subsidization legislation, but only because Republicans have sabotoged it enough in the name of "accountability" to virtually insure it will be perceived as a failure. Public perception be damned, I still think the first wave of work A123 did as a partly government-subsidized entity contributed a good deal to the industry, and that work is continuing today under the new ownership. In a way I prefer the new way because now nobody gets to complain about government money anymore--that's over. A123 is not yet profitable today, but they are closer than ever and have a plan to be profitable within a couple years. If they can execute worth a damn, I think they can succeed.

Patience, Luke. Your dedication and energy are admirable, but it doesn't help to constantly point out how much smarter you are than the average schmo (and we are smarter.)

Pacem,

The transition will happen faster than you think.

It was only 2-3 years ago that seeing a LEAF or Tesla Roadster was a rare treat. Now it's traffic jams of Tesla Model S and various other EVs.

This change happened in a mere 2-3 year period. It's only an insurmountable challenge until you believe it's not. A large population has caught on that EVs work. It is only time now.

People in the Bay Area know what I'm talking about, because we are living amidst the change already.

liveforphysics said:

The transition will happen faster than you think.

It was only 2-3 years ago that seeing a LEAF or Tesla Roadster was a rare treat. Now it's traffic jams of Tesla Model S and various other EVs.

This change happened in a mere 2-3 year period. It's only an insurmountable challenge until you believe it's not. A large population has caught on that EVs work. It is only time now.

People in the Bay Area know what I'm talking about, because we are living amidst the change already.

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I'm glad to hear there is a place where the change is this advanced. Early adopters everywhere deserve a lot of credit for the expense and hassles they endure. So too the governments who subsidize them. I agree it's just a matter of time before virtually everyone's driving some kind of EV, but I think it will be a bit longer than you or I would like, at least outside certain select areas.

I was in China last month for a week, my first time back since 2007. It was really gratifying to see that virtually all motorized scooters and bikes had gone electric. I saw literally thousands of e-bikes in my first 24 hours on this trip. They're everywhere. Even the old blue cargo trikes have mostly been upfitted to electric drive systems. It's a huge gain in noise pollution and air quality. At the same time, I don't think I saw a single EV or PHEV--and I was looking, believe me. We seem to be ahead of them there, but we won't be for long. Exciting times.

I have loved watching that fast transition to almost all EV scooters in China. Just 4-5 years ago, they were rare, now gas scooters are rare in many places, rivers of electric scooters replaced them. It's so cool to see the bigger EVs they are making as well. The home brew electric carts and little trucks are becoming very common. I do not miss the sold soot shooting single cylinder diesels they are replacing.

Passion pushes the plow better than muscle or mind, and in today's world, intelligence is a commodity.

wb9k and liveforphysics, you guys persevered through the attitude dross on page 1 and 2 to deliver clear and refined thoughts and we readers are the better off for it- thanks!

Perhaps you guys are following what's happening in the launch industry, I think it bears on what's coming in EVs.

The president of ULA (Lockheed and Boeing's monopoly launch provider bought and paid for with political contributions) is riding down the road thinking everything's great, after all, people still buy his $400 million rockets with Russian engines and noone seems to have noticed that he's little more than a used car salesman in an expensive suit. But what's that in the rear-view mirror? A glint of sun flashes from the titanium nosecone Elon Musk wears as a helmet. Looks like he's coming up at about mach 3 and I doubt he'll change lanes when blows right through. The rate that Spacex R+D moves at makes ULA literally look frozen in time, Boeing (give me some license to exaggerate here) can't make a battery pack, while Musk is building rockets the size of skyscrapers that land themselves. I think I can see a sweat stain growing on the collar of Mr. ULA's armani suit...

Have you watched the SpaceX launches online? The crowd of employees behind the glass at the Hawthorne launch control are almost entirely younger than 35. This generation is ready to buy change with blood, sweat and tears. Likewise Tesla, though they aren't the only driver of this change. The tipping point is coming up fast, and the giga factory will play a major role, perhaps it will be seen as the watershed in retrospect and it isn't that far off.

Of course there will be ICE cars on the road for decades to come, but it won't be long until they are viewed by younger drivers as anachronistic relics, and once that happens, change will come- swiftly. I was at the Chicago auto show this spring. It looked like a convention at an old-folks home. Very, very few attendees under the age of 30. The V8 engine models on display stands looked like museum pieces and the old guys gathered around some of the few EVs were all commenting on how "they catch fire when you look at them." Even when Ford showed off a high powered Mustang on a dyno in a live show, the only young face in the gathered crowd was the hired model/mc in a leather jacket. This thing is one big mother, but it's starting to tip.

liveforphysics said:

...people yelling up to you to let you know planes can't fly. ... The sooner you direct your efforts towards looking at reasons EVs can work rather than won't work

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But it isn't the binary question your straw-man approach makes it out to be. The issue is the present cost, specifically of battery packs. I can buy a used 150cc scooter for ~30% the cost of a new electric scooter batter pack with equivalent range. (A 20-mile range pack is about 72v 60AH. That's ignoring the controller et al. That pack alone will cost me $2,000. A used scooter with greater range and top end is a mere $700 here.) Due to battery costs, e-vehicles are presently toys for the rich. That is, unless you do not need much range, in which case you can get by with much cheaper packs, and e-vehicles can even become cheaper. An even worse story holds for 4-wheeled vehicles. A Tesla with gas-comparable range will run you a cool six figures.

Regarding the macro picture, I personally do not know, so I do not exclude the notion that battery prices are somehow artificially high as compared to oil prices even though gas prices doubled in inflation-adjusted cost after 911. http://inflationdata.com/inflation/images/charts/Oil/Gasoline_inflation_chart.htm

About raw material costs, the discrepancy between in LiFePO4 cathode prices between alibaba and aliexpress is IMO not explicable due to purity alone, an assertion liveforphysics made without any data and with an incorrect reference. I mean what are their costs? They purchase a few super-cheap super-abundant powders, stick them in a blender, and sell the blended powder, right?

About economies of scale, the cheapest factory should be operating at full capacity while the others close entirely.

About patents, possible. The UT-NTT lawsuit was settled long ago for 30 million, as I recall, but I don't see any impact to Chinese LiFePO4 producers.

Therefore, while I think we have made some headway on the underlying question, it all still makes little sense to me.

Jason

jasontaylor said:

Regarding the macro picture, I personally do not know, so I do not exclude the notion that battery prices are somehow artificially high as compared to oil prices even though gas prices doubled in inflation-adjusted cost after 911. http://inflationdata.com/inflation/images/charts/Oil/Gasoline_inflation_chart.htm

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Yes, its an artifice, as made-by-men and therefore capable of being changed-by-men. Its the relative cost between oil and li-ion that's relevant. But again, only if the corporate externalities are born by society-at-large. If the environmental cost of carbon pollution, the total costs of the military-industrial security apparatus, and other externalized costs are shifted back, so when buying a gallon of gas, the consumer is paying for it all, then suddenly you'd see this massive shift to low-carbon, low-need-for-perpetual-war electric vehicles.

jasontaylor said:

liveforphysics said:

...people yelling up to you to let you know planes can't fly. ... The sooner you direct your efforts towards looking at reasons EVs can work rather than won't work

Click to expand...

But it isn't the binary question your straw-man approach makes it out to be. The issue is the present cost, specifically of battery packs. I can buy a used 150cc scooter for ~30% the cost of a new electric scooter batter pack with equivalent range. (A 20-mile range pack is about 72v 60AH. That's ignoring the controller et al. That pack alone will cost me $2,000. A used scooter with greater range and top end is a mere $700 here.) Due to battery costs, e-vehicles are presently toys for the rich. That is, unless you do not need much range, in which case you can get by with much cheaper packs, and e-vehicles can even become cheaper. An even worse story holds for 4-wheeled vehicles. A Tesla with gas-comparable range will run you a cool six figures.

Regarding the macro picture, I personally do not know, so I do not exclude the notion that battery prices are somehow artificially high as compared to oil prices even though gas prices doubled in inflation-adjusted cost after 911. http://inflationdata.com/inflation/images/charts/Oil/Gasoline_inflation_chart.htm

About raw material costs, the discrepancy between in LiFePO4 cathode prices between alibaba and aliexpress is IMO not explicable due to purity alone, an assertion liveforphysics made without any data and with an incorrect reference. I mean what are their costs? They purchase a few super-cheap super-abundant powders, stick them in a blender, and sell the blended powder, right?

About economies of scale, the cheapest factory should be operating at full capacity while the others close entirely.

About patents, possible. The UT-NTT lawsuit was settled long ago for 30 million, as I recall, but I don't see any impact to Chinese LiFePO4 producers.

Therefore, while I think we have made some headway on the underlying question, it all still makes little sense to me.

Jason

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Jason,

Nice to meet you. I think you are oversimplifying a few things here, but you're clearly a sharp guy. Keep digging. From my perspective, the truth is there remains a lot of low hanging fruit throughout the industry, though lots has been harvested already. It's hard to settle a single plant into a groove when demand appears to be poised to explode, is peppered across the globe, and local engineering and warranty support is a must. From the sound of your comments, I'm sure you see the spinoff of A123's powder and grid businesses as logical given the current environment of bankruptcies, buyouts, and consolodations. So too with making it's R&D arm available for hire. A big part of the problem--and this is a common thread through many of the alt-energy collapses over the last few years--is companies trying to grow too fast, too soon. They planned for a home run regarding all facets of execution and customer acceptance, and when that didn't materialize they suffered, some of them fatally. The markets they served suffered right along with them.

A123's powder operation was running at some 20-30% tops the whole time A123 had it.

Anyway, welcome!

There are two assertions that have been repeatedly made in this thread that I take issue with:

1) EVs are non-polluting.

Incorrect. Their manufacture and use surely does pollute, it is simply shifted away from the point of use. Good for local air quality, less so for the schmuck living near the brown coal-fired power plant that's providing the juice for recharging.

I imagine an argument might follow about relative pollution of ICE vs. EV, but surely the least polluting thing is not to build a large EV car in the first place? It doesn't bother me at all if someone wants to have a Model S, Leaf and Prius on the drive of their large, air-conditioned San Fran house, but it's ridiculous and pretentious to think that is "eco-friendly" or low-impact. The moment that chap starts boo-ing someone for driving an old ICE car, they simply validate the South Park episode "Smug Alert!".

2) EVs are the solution to World Peace.

Reduced oil consumption will remove the need to fight over it as a resource. The result will be the World's umpteen different creeds, races and religions all holding hands, wearing sandals and singing. I'm sure there would be no quarrelling over lithium reserves, rare-earth mines or some other natural material suddenly in large demand.

Punx0r said:

There are two assertions that have been repeatedly made in this thread that I take issue with:

2) EVs are the solution to World Peace.

Reduced oil consumption will remove the need to fight over it as a resource. The result will be the World's umpteen different creeds, races and religions all holding hands, wearing sandals and singing. I'm sure there would be no quarrelling over lithium reserves, rare-earth mines or some other natural material suddenly in large demand.

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+1
Wars , invasions, massacres, genocide etc etc, were occurring way before oil was discovered and will continue long after its forgotten. Most wars are fought over religion, race, or simply mans egotistical ambitions.

Hillhater said:

Wars , invasions, massacres, genocide etc etc, were occurring way before oil was discovered and will continue long after its forgotten. Most wars are fought over religion, race, or simply mans egotistical ambitions.

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Sometimes, but the adage is that "All wars are resource wars." When the commodity that grants power is access to the pulpit, then its that. In our current world, and really every since WWI, that commodity is oil. Every war the USA has entered, whether through the machinations of other nations or our own, since and including WWI, has been to protect the essential natural resources upon which the military-industrial complex is itself dependent. At the top of that list is oil, and that will remain so for quite a long time. Not religion, not race, not ambition. Oil. If you don't think so, then I pity your poor historical education and/or perspective.

The origins of WW1 and WW2 had nothing to do with oil. I don't believe it was a significant issue in the decision by the U.S.A. to enter those wars, either.

It was a strategically important resource (more so in WW2), but so was rubber, food, ball-bearings, aluminium, silk etc

arkmundi said:

Every war the USA has entered, whether through the machinations of other nations or our own, since and including WWI, has been to protect the essential natural resources upon which the military-industrial complex is itself dependent. At the top of that list is oil, and that will remain so for quite a long time. Not religion, not race, not ambition. Oil. If you don't think so, then I pity your poor historical education and/or perspective.

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Exactly what essential resource was the US protecting when it entered the Pacific war against Japan in '41 ?
No,.. that was a Defensive action against Japanese egotistic aggression.
Korea ?
Vietnam ?

[youtube]2DCwafIntj0[/youtube]

arkmundi said:

Every war the USA has entered, whether through the machinations of other nations or our own, since and including WWI, has been to protect the essential natural resources upon which the military-industrial complex is itself dependent. At the top of that list is oil, and that will remain so for quite a long time.

Click to expand...

If you and the other guys are right, wouldn't the first country we invaded or bombed after 911 have oil ? But after 911, who did we bomb first? Afghanistan. Did they have oil? Nope. Sort of breaks this big oil conspiracy theory.

Unless...unless it's much worse than that. Hmm. Hypothetically speaking, let's see something. Ebay is now selling 1kg of lithium carbonate for $50 USD. http://www.ebay.com/itm/1kg-99-Lithium-Carbonate-Powder-Li2CO3-ETJ-/171297095802?pt=LH_DefaultDomain_0&hash=item27e21a407a Seems high. Was I was wrong to not question posts like this http://fuel-efficient-vehicles.org/energy-news/?p=769, which say lithum is cheap? Perhaps. Those posts are about hybrids, which don't need much battery capacity.

Not many know this, but Afghanistan was set to earn a trillion dollars selling lithium on the open market. They discovered the reserves in the 1980s. http://www.mining.com/1-trillion-motherlode-of-lithium-and-gold-discovered-in-afghanistan/ They thought they kept the discovery secret. But, be serious, how long is that gonna work? Big oil might not have wanted that dump to happen. I confess, seems they really benefited from 911, since, in addition to doubling oil prices/profits, it also prevented that lithium from being sold, which raised battery prices worldwide. Was lithium the real reason we had the war on terror? To keep the price of lithium above $3000/tonne?

I personally think it is a little far fetched. I've argued that side elsewhere. http://yoyonemo.blogspot.com/2013/11/why-travel-part-2-human-conflict.html?showComment=1392782871106#c1869732307808430308 . It's fun to pontificate, and it would make a great movie, but IMO WWI, II, and the war on terror are better explained in my post about the true cause of wars here https://twitter.com/jasontaylor7/status/470674547285311488 (The post on that begins with, "Mr. Schumacher", not "Is there a difference...".) The cause? In short, our desire to be nice.

I am sticking to my new idea that the high price of lithium is the cause of high prices of lithium batteries, however.

It's this simple.

If you want to see EV's, make them or buy them and use them.

We have seen proof here you can make working EVs on every budget.

If you don't want to see EVs, keep believing in reasons they won't work, and then keep your eyes shut as they begin to fill your cities around you.

Lithium in Afghanistan is a coincidence. Just as the Iranians having cracked the secret of solar power separating hydrogen from water was never enough to get us to invade Iran.

But if you're going to use history to push your agenda, you should at least LEARN what that history is and keep your foot out of your mouth.

Hillhater said:

Japanese egotistic aggression.

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Dang, I've never seen it summed up so well as in those three words. Just the kind of gross oversimplification that they world cries out for. But Japan at that time is an example of one of the biggest causes of invading another country: Because you face revolt after revolt at home. In 1903 a Russian minister said something to the effect of the need for a 'Short, Victorious War' to stem the ongoing rebellion. Months later they were at war with Japan and yet the "Odessa Steps" still occurred. In Japan it was the "Young Officers Uprising," and other things. But those fools thought it was going to be easy, hence "Egotistic."

WWI has one thing in common with the invasion of Afghanistan: The Central Powers were fighting terrorism. Those of us from Allied countries grow up being taught they were just bad guys, that's simply wrong. Britain went off a bit half cocked declaring war on Germany, but that's understandable since the quality of information was far worse then than it is now. They thought they could PREVENT 'Powderkeg Europe' from being touched off; instead. . . .

WWII in Europe was about two things: Reuniting Germany, which many outside Germany were acknowledging was the right thing to do, and spreading socialism. (Absolutely the WRONG thing.) Had the 1934 Socialist revolt that was some 100 or so feet from the Parliament succeeded in taking down the government, (Only their poor coordination and lack of resolve of the Croix-de-feu prevented it) the new French government would likely have sided with the other Nuevo Utopists, Germany, Italy, Russia, by 1939. I doubt the British would have tried to fight in Poland or much of Europe had the French not at least been claiming to fight them also. But with not only the various rival factions trying to initiate coups and bombing goverment buildings, (Hitler and other Nazi leaders had barely left the 'Winter Relief' fundraiser when the bomb finally went off, the baddies simply assumed they'd stay later) but even their own SA (The SS was created to counter the fear of the SA) going rogue and planning to overthown their own party, oh but did Hitler ever need SOMETHING to unite his people. The Nazi's never took 50% in an election.

http://thisdayinalternatehistory.blogspot.com/2011/02/february-6-1934-riots-ignite-french.html

This particular thought is that since the Fascist groups had so many WWI veterans they would ultimately win the argument with the various other socialist groups over who was in charge if the revolt succeeded. With the friendly French to feed them when England wants them blockaded, there's no need to keep desperately taking over more countries in a panic, (Ah, the "Phony War," if only schools taught what a friendly affair it really was) Goring wouldn't have been pleading with Hitler every day that this would backfire, Hess would never have flown to England. . . . With all that I've written here it's STILL just a gross oversimplification. But the Germans themselves said that if the Saar Offensive into Germany by the French had continued Germany would have fallen in about two weeks. Instead when they withdrew, the French forces in Poland that were driving the Germans back also withdrew. Imagine there was never a WWII, just an "Operation Euro-Shield. . . ."

But notice how oil hasn't come up yet?

Nice summary

I'd add that it's interesting (and ought to be a warning for the future) how massive an influence of the disposition or personality flaws of one man (or a few men) can have on these issues that ultimately result in warfare. Beware the war-mongerer who claims to benefit you, the common chap, when really he is likely a sociopath interesting only in his personal ambitions and status.

The diplomatic role played by the Royal family across Europe was also interesting in how it almost prevented WW1. A man might lead a country and command a large army, but he still answers at least in part to his Grandmother who will scold him for being naughty

liveforphysics said:

It's this simple.

If you want to see EV's, make them or buy them and use them.

We have seen proof here you can make working EVs on every budget.

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Well put. My modest budget has resulted in my ebike, which has replaced the use of my ICE car for many short journeys.

Just wanted to point out they have planned to cut the petrol/gas subsidy in the AU 2014 budget which is getting some people very angry and some are suggesting its going to be a one term AU government here. This is along side paying $7 to see a doctor.

If you read this article about it below be sure to read the lot. Main thing you can get misled by is that there had been a standard fuel tax linked to inflation for a long time in AU but it was cut a few years ago cos it was getting pricey now its merely going back to normal but some people want to read it as a "hike"
http://www.theaustralian.com.au/national-affairs/budget-2014/tony-abbott-defends-tax-take-as-petrol-hike-locked-in/story-fnmbxr2t-1226915222171#

I guess all I am saying is people like cheap fossil fuels and will happily decapitate your head if you suggest a "better" way that may require any chance in financial cost.

TheBeastie said:

I guess all I am saying is people like cheap fossil fuels and will happily decapitate your head if you suggest a "better" way that may require any chance in financial cost.

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Then the price hike comes and they pay it anyway.

In the 3 years of mad run ups, 2005-2008, they talked about the ceiling where people just weren't going to pay it. At $3/gallon it paused when sales dropped off, then fell. Got going again to hit $4/gallon in finding where sales were lost, then paused and fell. Less than 3 years into the run up it hit $5/gallon. There was a pause, then some redaction, but it turned around and went right back up over $5/gallon.

Then WallStreet collapsed. That was the only thing that stopped the rising price. It fell under $3/gallon, but it's gone up since. . . .

Dauntless said:

TheBeastie said:

I guess all I am saying is people like cheap fossil fuels and will happily decapitate your head if you suggest a "better" way that may require any chance in financial cost.

Click to expand...

Then the price hike comes and they pay it anyway.

In the 3 years of mad run ups, 2005-2008, they talked about the ceiling where people just weren't going to pay it. At $3/gallon it paused when sales dropped off, then fell. Got going again to hit $4/gallon in finding where sales were lost, then paused and fell. Less than 3 years into the run up it hit $5/gallon. There was a pause, then some redaction, but it turned around and went right back up over $5/gallon.

Then WallStreet collapsed. That was the only thing that stopped the rising price. It fell under $3/gallon, but it's gone up since. . . .

Click to expand...

Its better visual when u look at the crude oil 'barrel' chart.
http://www.nasdaq.com/markets/crude-oil-brent.aspx?timeframe=10y
Watch the huge spike for more than $90 down

Arkmundi, we have not got a drop of oil from Iraq.

The Iraq war was a giant money laundering scheme. Contractors like halliburton taken in billions of taxpayer money.

dogman said:

I'm such a pessimist. Solar panels were supposed to get very cheap if they just made more, but they didn't. Oil is fairly cheap to produce, it's sold expensive. etc...

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???

In my part of the world (Germany) the price of solar panels has fallen almost 10fold during the last 10 years.

Electricity from a NEW solar power plant costs as much as electricity from a NEW gas powered plant (around 8-9€ct/kWh in Germany)

Price of Li-Ion batteries also has falle draamtically during the last 20 years. It needs to fall by another factor of 5 which seems to be possible.

LiFePO4 is not very interesting for mobility, but for residential use.