Why Investors Need to Pay Attention to this New Electric Car Battery

Jeff Siegel

Written By Jeff Siegel

Posted January 15, 2024

Last week, BYD (OTCBB: BYDDY) began construction on a new sodium-ion battery plant.

If you’re unfamiliar, sodium-ion batteries represent a new type of EV battery chemistry that some analysts believe could be the first battery chemistry to legitimately challenge the more common lithium-ion batteries used in nearly every electric vehicle today.

You see, sodium-ion batteries are between 24% and 32% cheaper than lithium-ion batteries.  They’re also easier to produce, they carry less environmental burdens than lithium-ion, they’re incredibly stable at extreme temperatures, and they can charge faster than the lithium-ion batteries currently in use. 

There is a downside to sodium-ion, however: energy density.

Energy density describes the amount of energy stored with respect to the battery’s volume. The energy density of sodium-ion is lower than that of lithium-ion, which means EVs using sodium-ion batteries can’t travel as far on a single charge.

It’s unlikely that an EV using a sodium-ion battery will travel further than 140 miles on a single charge.  And that would be if the car were a compact or sub-compact.  If you tried to use a sodium-ion battery to power something like an electric Ford F-150, you’d be lucky to get 50 miles.

That being said, for a lot of folks, 140 miles would be just fine.

In the United States, the average driver only drives about 40 miles per day. And this exceeds daily miles driven in Australia, the UK, the EU, Canada, and Japan.

I’ve tried tracking down the average daily miles driven in Canada, but that data is a bit hard to find.  At least from reputable sources.  But based on my checks, it’s probably safe to assume that the average driver in China drives no more than 50 miles per day.

Of course, in the United States, it’s still quite hard for most folks to feel comfortable with an EV that can’t deliver the same range as an internal combustion vehicle. Especially when you consider that it takes far longer to recharge a vehicle than it does to fill one with gas or diesel. 

And let’s face it: if you’re going to drop $40,000 or more on an EV, you want it to deliver a range of at least 250 miles. 

But what if that price fell to $15,000, or even $10,000?

Would an EV with a range of 140 miles become more attractive to car buyers if it cost less than $20k?  Especially when it could only take 10 to 15 minutes to charge?

BYD seems to think so, as it’s now seeking to become the largest supplier of sodium-ion EV batteries in the world. 

And BYD isn’t the only company looking to get into the sodium-ion battery market, either.

Last year, Battery giant CATL announced its sodium-ion batteries would be used in a new EV being produced by China-based Chery International. 

And on Friday, Stellantis (NYSE: STLA) announced a new investment in a sodium-ion battery startup called Tiamat.  

While I haven’t seen any credible data on this yet, Tiamat claims its batteries can be recharged in 5 minutes.  If this proves true, this could be a huge game-changer.

Although it should be understood that Stellantis has been very active in diversifying its EV battery investments by placing bets on numerous battery chemistries that include not just lithium-ion and sodium-ion, but solid-state batteries and lithium-sulfur, too.

It should also be noted that Stellantis has secured enough supplies of EV battery materials through 2027.

The company has been very vocal about its focus on vehicle electrification, aiming for 100% of European sales to be electric by 2030, and about 50% in the U.S.

While BYD has an early mover advantage on Stellantis, Stellantis is a behemoth with mountains of cash and a massive global presence.  

And while BYD is in no danger of going gently into that good night, Stellantis is doing the heavy lifting now to secure a top spot in the EV food chain.  And it will succeed.

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