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(AP) — The world’s largest maker of batteries for electric vehicles said Wednesday it will get into battery swapping in China in a big way starting next year.
The idea behind battery swapping is to refuel quickly, similar to filling a conventional car with gas. Instead of waiting for the batteries to recharge, one swap out the old ones with a block of fresh ones at a swap station. An EV driver pulls into a swapping station, and automated technology exchanges the low battery for a fully charged one the station has available.
China-based CATL announced plans to open 1,000 swap stations next year in China, including in Hong Kong and Macao, with a long-term goal of 10,000 stations built with partners. If the company follows through, it could rival Nio, a 10-year-old Chinese electric car brand that has opened more than 2,700 stations and has plans for at least 5,000.
Nothing on that scale exists elsewhere in the world, though Nio has about 60 swap stations in northern Europe. Such a large investment is possible in China, where government support has transformed the world’s largest auto market into a heavily electric one and made the country a leader in EV technology.
“By 2030, battery swapping, home charging, and public charging stations will share the market,” Robin Zeng, the CEO of CATL, predicted at a splashy presentation in southeast China’s Fujian province, where CATL is based. He appealed to corporate partners to work together to “build more convenient, more economical and safer services for customers, promoting a brand-new way of life.”
Battery swapping faces hurdles. It requires a standardization of the battery pack so the swap stations can handle it, and most EVs have their own configuration. An electric vehicle has to be equipped with the right technology in order to use a battery swapping station, and not many EV models around the world currently allow for swapping.
Conversely, an electric car can use any charging station in China because all use a common plug, and fast-charging technology is reducing the time for a recharge.
Jing Yang, a Fitch Ratings director who focuses on China’s auto and renewable energy sectors, said automakers may be concerned that adopting a standard battery pack could cede too much control of their supply chain to others.
Electric car manufacturers have many changing specifications to stay on top of and invest in as the EV market evolves, making new technology a hard sell. It is difficult to get automakers to buy into less feasible infrastructure if EV adoption in a region is still relatively low.
But some may want to test the waters to see if battery swapping can improve sales, and doing so with CATL or Nio could reduce the cost, she said. That’s because a driver wouldn’t have to own the battery, which is currently the most expensive part of an EV.
China auto market analyst Lei Xing believes that swapping can complement the country’s well-developed charging network. “I don’t see it becoming mainstream, but I do see it becoming a key part of that infrastructure landscape,” he said.
Michael Davidson, a renewable energy expert at the University of California, San Diego, believes that charging will dominate “and maybe there’ll be some battery swapping options mixed in there.”
The concept has proven easier to implement with fleet vehicles — taxis, buses, and commercial trucks — that have a standard model and, in some cases, stick to set routes. CATL, which launched a small pilot project two years ago aimed at taxis, will start its rollout with fleets and expand to individual car owners later, said Zhang Kai, the deputy president of CATL’s battery swapping subsidiary.
Swapping is still faster than fast charging. The CATL station, branded EVOGO, can change a battery pack in 100 seconds, said Yang Jun, the CEO of the subsidiary. Time is money for taxi and truck drivers, Lei said.
Wang Wubing, a driver at China’s popular Didi ride-hailing service, said at an EVOGO station in the city of Xiamen that he swaps batteries to save time so he can pick up more customers. But it is more expensive than charging.
In the U.S., battery swapping made headlines nearly two decades ago with the startup Better Place, which later shut down. Now, companies such as Ample have reinvented the technology, also starting with the ride-hailing market. Uber and Lyft drivers who own electric cars want to spend time on the road and earn money instead of waiting even for the fastest EV charge. Ample says its swaps take just 5 minutes.
Both CATL and Nio have announced agreements with automakers to use their swap stations. The question is whether enough automakers and drivers adopt it to raise the use of the stations to a profitable level.
China will soon see a massive expansion of electric vehicle battery swapping, as global battery maker CATL said Wednesday it is investing heavily in stations there next year.
Battery swapping is not new — but it’s had a challenging journey. Adoption of electric vehicles has varied in regions across the globe over the past several years, and that doesn’t always bode well for building new infrastructure.
While the technology could do well in China, it’s uncertain whether it could work in other countries.
What is battery swapping?
Battery swapping allows EV drivers to pull into a station on a low battery and receive a swapped, fully charged battery within minutes.
An EV has to be equipped with the right technology to receive a swap — and not many models around the world currently have it. Automakers have to buy into the idea, and EV adoption among consumers also has to grow, so investing in new infrastructure seems worthwhile. Consumers also have to be comfortable not owning their batteries.
Why could it work in China?
China is much further along in adopting EVs than other countries.
Not only is it the world’s largest auto market, but in July, the country hit a milestone with 50% of new sales electric — and it accounts for most of this year’s global EV sales.
China supports EV growth through government subsidies and mandates. So it makes more sense for companies to invest in unique EV infrastructure there because that’s more likely to be needed.
What other attempts at battery swapping have occurred?
The most notable example might be Israeli startup Better Place, which tried its hand at swapping in 2007.
But the company shut down a few years later after investing a lot of money and coming up against roadblocks with logistics. EV adoption was especially low at the time.
Could it work in the United States? Europe?
Startup Ample, for example, has a modular battery swapping station that it says can complete a swap in 5 minutes. That’s important as charging time remains a point of concern for prospective EV buyers. Even the fastest fast chargers could take at least 15 minutes for a decent charge.
But in the U.S., pure EVs only accounted for 8% of new vehicle sales as of November.
Meanwhile, Nio, a rival Chinese EV brand, has about 60 swap stations in northern Europe, and the EV adoption is higher there than in the U.S., but the same challenges remain.
Different automakers put different batteries in their various EV models, so a station would need all of those available if the industry didn’t agree to a standardized battery, and not all of those models are out yet in volume. This is something that really needs scale.
Swapping could help with EV cost — currently a barrier to adoption for many — because a driver wouldn’t necessarily own the most expensive part of an EV: the battery.
Greg Less, director of the University of Michigan Battery Lab, said with proper framing and education, people might like the idea of battery swapping. To him, it’s not unlike buying a propane-fueled grill and purchasing a refilled tank every so often. But it would require a rethinking of car ownership.
“Where I could see it working is if we went entirely away from vehicle ownership and we went to a use-on-demand model,” Less added. “I don’t think we’re there yet.”
What vehicle uses might be b
est for swapping?
Battery swapping might make the most sense for ride-sharing or other fleet vehicles.
Drivers of buses, taxis, Uber or Lyft vehicles want to spend as much time on the road as possible, transporting customers and making money. If battery swapping can shorten the time needed to charge EVs, that makes driving one less disruptive to their business.