Lithium Ion Starter Batteries: Will BYD Take The Place Of A123 Systems?

Tweet This contribution is about "Build your Dreams" - BYD (BYDDF.PK), Warren Buffett's most famous investment in China. It's aimed at analyzing this company's possibilities of success in the introduction of Li-ion starter batteries into the micro-hybrid car market.

BYD is currently betting on a "re-birth" plan to reverse a series of setbacks it confronted over the last 3-4 years. According to a recent Reuters report, BYD's business "sprawls across batteries, cell-phone assembly, solar panels, LED light bulbs, and electric and gasoline-powered cars and buses." The firm now wants to focus on what it does best: "advanced but affordable iron-phosphate lithium-ion batteries".

In this connection, at the Shanghai Auto Show 2013 BYD "unveiled several exciting technologies to improve fuel efficiencies by greater than 20% in all their 2014 vehicle line-up". One of these technologies constitutes a higher-efficiency 48 VDC vehicle voltage platform which uses Li-ion batteries instead of 12VDC lead-acid batteries. The new technology discards starter-battery replacements while extending the battery life to the expected life of the car. In addition, it allows vehicle transition "to all-LED lighting, Electronic Parking Systems, Hybrid and regenerative braking, idle start-stop energy management, automatic engine starts, low rolling resistance and advanced aero-dynamic designs." Lastly, also as part of this advancement, "a purification technology is integrated into the vehicle's air conditioning system and detects the inside and outside particulate matter levels, triggering auto-air-filtering equipment."

In an article published in 2011, I concluded:

"No doubt A123 has a lot of potential in the energy storage sector as a whole, particularly as we head toward a new lithium era in the world. It is perhaps the only company capable of leading the emerging advanced lithium battery industry in the US. But this may take at least another two or three years. Meanwhile, A123 urgently needs to show clear, concrete and immediate results to its shareholders. Lithium-ion battery massification in the ICE car industry may then be a way out of the financial crisis that has put this company at serious risk of survival."