What the big guys pay

T

tomv

100 W
Joined
Jul 16, 2007
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Here's an interesting snippet in the news:
http://www.autobloggreen.com/2008/08/26/enerdel-ramping-up-battery-production-to-supply-th-nk/

Th!nk has ordered $70 million worth of battery packs from EnerDel, which equates to about 5,000 units. Each pack contains about 27 kWh of power.

So, that's $0.5/Wh. It's not clear if that includes assembly, bms, cooling, etc. But that gives a bit of perspective as to what we have to shell out for batteries. Power tool backs are basically marked up 100%. Dedicated lithium packs from guys like ebikes.ca, Lifebatt, etc are marked up 300%. I'll sit tight a bit more and hope all those new factories that are going up will translate in more reasonable supply and some competition.
 
tomv said:
Here's an interesting snippet in the news:
http://www.autobloggreen.com/2008/08/26/enerdel-ramping-up-battery-production-to-supply-th-nk/

Th!nk has ordered $70 million worth of battery packs from EnerDel, which equates to about 5,000 units. Each pack contains about 27 kWh of power.

So, that's $0.5/Wh. It's not clear if that includes assembly, bms, cooling, etc. But that gives a bit of perspective as to what we have to shell out for batteries. Power tool backs are basically marked up 100%. Dedicated lithium packs from guys like ebikes.ca, Lifebatt, etc are marked up 300%. I'll sit tight a bit more and hope all those new factories that are going up will translate in more reasonable supply and some competition.
Click to expand...

Sorry Tomv - while I can't speak for Jason @ ebikes.ca I CAN tell you that LiFeBATT's markup is grossly mis-stated in your post by at least 5 - 6 times the actual markup. People should take comments like this posted here with a whole lot of salt, because you happen to be way off the mark! I don't know where you get these numbers from, or how you back them up, but it's best not to spout off about companies and their markups that you cannot support by real documentation. As I said I can only speak for LiFeBATT here.

Best,

Don Harmon :mrgreen:

"setting the record straight"
 
When I read Tommy's post, red flags went up in my head. Not doubting his numbers or sources, just his reasoning and logic. One statement is pretty close, as I've always heard that retail stores markup runs near 100%. When you figure the cost to operate storefronts, shipping departments, customer relations, etc, etc, I've never felt this was terribly excessive. Just a "feeling" but one with long standing and validation from a number of friends in retail businesses.

The bold statement that: Dedicated lithium packs from guys like ebikes.ca, Lifebatt, etc are marked up 300%. presumes that Tommy has access to significant parts of the business records of those two companies. If so, I'm sure those companies would like to know how such knowledge was obtained. Is he their accountant? As to the truth and/or accuracy of his statement, I don't know. Don says "no".

I do agree with Tommy's last sentence, though: "I'll sit tight a bit more and hope all those new factories that are going up will translate in more reasonable supply and some competition." Inevitably, the market will stabilize. When supply, technology, business models and other factors settle, pricing will almost certainly come down. Meanwhile, the vendors are either charging what the traffic will bear or they are not selling stock that is sitting on their shelves.

I found what seems to me a good entry point to the lithium battery users "group" outlined in my post early yesterday morning in this thread: http://endless-sphere.com/forums/viewtopic.php?f=14&t=2250&st=0&sk=t&sd=a&start=15

My guess would be that Bosch found themselves with a bunch of the "fat pack" batteries sitting on shelves and decided to sell them off at a lower cost than their "slim pack" batteries. To me, that looks like simple "supply and demand" inventory management. Good news for me, good business for Bosch, and everybody concerned comes away happy! :D

So, now it's up to me to fabricate proper pack construction and wiring. Questions (and photos) will undoubtedly follow!

ATB

BC
 
olaf-lampe said:
I believe, that there will be a shortage in Li-xx batteries for the next few years, when demand will explode from the car industry. That will not harm our small batteries, as long as their makers aren't too busy to build them instead of bigger cells for cars.
So don't wait to long...
-Olaf
Click to expand...

I have to agree with this speculation. The short-term will probably see high-prices due to lagging supply compared to the exploding demand as it takes time to build the infrastructure for manufacturing batteries but for the "short term"(in the next three years), I suspect this winter will be among the best time before car companies start introducing their electric models en masse and placing huge demand on lithium. In the long-term, after the price starts to approach the economies of scale-effected equilibrium, I think we can expect more reasonably priced lithium. In the long-long-term, there might be a "lithium shortage" due to world-wide usage and consumption in such large quantities so I'm hoping that other feasible energy-storage technologies develop(And the sooner, the better.).

However, if oil prices continue fallling downwards, we might see the demand for electric vehicles to dissipate. But I suspect it would have to drop by HUUUGE amounts before that'd happen as public interest in alternate vehicles is currently peaked and is likely to linger for at least the next several years, and much publicity and investment has been made in electric vehicles by major companies.
 
Sorry for [OT]
The oil price at the gas stations will rise, the more electric cars are on the road. Because the oil companies have their fix expenses and less customers. Have you ever wondered why gas is more expensive during holiday periods? Because halve of the employees stay at home not using gas for commuting.

-Olaf
 
olaf-lampe said:
Sorry for [OT]
The oil price at the gas stations will rise, the more electric cars are on the road. Because the oil companies have their fix expenses and less customers. Have you ever wondered why gas is more expensive during holiday periods? Because halve of the employees stay at home not using gas for commuting.

-Olaf
Click to expand...

Dude, that is TOTALLY backwards. The reason gas goes up during holidays is because a quarter of the population is driving 10 times as much to get to their far-away destination. And airplanes are full and using more fuel.

Oil is a comodity - it doesn't go up in price as the demand goes down.
 
I'm sorry that my post sounded like an attack on dedicated pack sellers. It's certainly great that some people serve e-bike industry whatever the price. I'm not saying the sellers mark up the prices

My point is this:
Lithium producers sell packs for $0.5/Wh
I can buy for $2/Wh.

So the price quadruples one way or another. It doesn't matter which way. Also I think that the shortage will not be long lived. Batteries are commodities, and commodities never have large margins for long (think memory chips, hard drives, LCD panels, lead acid batteries, alkaline batteries, etc).
 
tomv said:
I'm sorry that my post sounded like an attack on dedicated pack sellers. It's certainly great that some people serve e-bike industry whatever the price. I'm not saying the sellers mark up the prices

My point is this:
Lithium producers sell packs for $0.5/Wh
I can buy for $2/Wh.

So the price quadruples one way or another. It doesn't matter which way. Also I think that the shortage will not be long lived. Batteries are commodities, and commodities never have large margins for long (think memory chips, hard drives, LCD panels, lead acid batteries, alkaline batteries, etc).
Click to expand...

Your point is not valid, Tom. What are you buying for $2/Wh ? What are "lithium producers" selling for $ 0.5/Wh. ? Please be clear on how you define "batteries". Is a battery a single cell like what you buy at the drugstore for your flashlight or is it a highly refined totally integrated Pack that can be arranged in a complete EV systems application ?

The "commodity" label really has no particular application right now when it comes to high -end lithium ion battery solutions. If you think these products are going to drop in price like a rock, you are sadly mistaken. You may be waiting 5-10 years to see that take place ? There simply will not be enough "state of the art fabrication capability" to meet the expanding needs of this market in the next decade. Once again, check your facts, and please cite your sources before you make assertions like you do. Prices are likely to adjust to the market, once more volume can be realized, but not enough to appeal to what most people think should happen.

We would all like to know where you find these numbers you state and how you support your thesis ?

Best Regards,

Don Harmon :mrgreen:
 
Yes, I'd mostly agree here as well.

Cells can be purchased (in large volumes) from .30 to .70 (USD) /Wh. This includes PSI and Thundersky. But these are just the costs for the cells. It does not include the cost of the money itself (e.g.; 6 months delivery time), shipping, customs brokerage, etc. And remember the volume discount - you can save 10-30% going to CostCo and getting their volume discount, and you can easily have to buy more than you want/need.

Sometimes you can find a buy - even I can get you ThunderSky for .67 / Wh - and that includes shipping. PM me if your interested. But that does not include BMS, charger, banding (cell compression) or a warranty. Cells are conditioned and tested, but that's it. It's too easy to ruin lithium through misuse. Anybody that offers a warranty just has to charge more to cover their costs.

So, yes, you need to be very specific when talking about costs.
 
You betcha Don. The guys who assemble , package, ship, and warrantee the finished pack do have to get a paycheck. They may also be buying in quantities that do not get as low a price for the raw cells and stuff as some think. Oil on the other hand, does have a 300% markup for no particular reason other that we'll pay it.
 
True and gasoline is a "fungible" product. It doesn't much matter if you put Texaco, Mobil, Exxon, or Chevron in your gas tank - your car will run the same. Batteries however are a different story as everyone can attest to by the wide range of test reports found here on this forum. Thus you would expect a wide range of prices too!

Don :mrgreen:
 
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