Think Advanced Materials: Battery
Technology
Electrifying Automotive Transportation
THINK SUMMARY:
We believe that the transition to the electric drive is on the horizon. We think
that the new alliances between car makers and battery suppliers, combined
with additional investments to increase lithium-ion manufacturing capacity,
support our view.
KEY POINTS:
Lithium-Ion Technology Is Ready For Prime Time, In Our View
The advancements in battery performance and safety lead us to believe that
lithium-ion technology is ready for prime time. The flurry of global activity to
meet the expected growth in the electric car market suggests that commercial
adoption will be strong, in our view.
Cost Biggest Obstacle
We believe that the biggest obstacle to commercialization is the cost of
manufacturing the batteries. There are various components highlighted that are
behind the high cost. Over time, most manufacturers should benefit from
economies of scale.
Starting To Hit The Road
Despite weak macroeconomic conditions, the move to driving electric vehicles
is still occurring. Electric vehicles are starting to hit the road. Numerous models
(some concept) have been announced and are projected to be on the road in
the next three years.
Large Opportunity
IBM Automotive projects that the automotive market for lithium-ion batteries
should reach $18.5 billion by 2014. There are numerous other industry growth
projections for the lithium-ion battery industry and they all have one thing in
common: the market opportunity appears significant. We believe that the
market growth will be considerable and expand well into billions of dollars in
coming years. Alliances are forming, with development-stage companies
maturing. We believe that this scenario presents a significant opportunity for
investors.