Lithium-Ion Battery Raw

Material Supply and

Demand 2016 – 2025
Mike SANDERS
June 19th, 2017 AVICENNE ENERGY

Presentation Outline
• The rechargeable battery market in 2016
• The Li-ion battery value chain
Christophe PILLOT • Li-ion battery material market
+ 33 1 47 78 46 00
[email protected]
• Forecasts & conclusions
 THE BATTERY MARKET IS REALLY
DYNAMIC
Cellular Phones sold per Year (Million) Portable PC sold per Year (Million)
3000 400

Million Units/Year
Million Units / year
Li-ion Li-ion
NiMH 300 195 M
Lithium ion battery raw 2000
Tablets
material supply & demand 200
2016 - 2025 1000 165 M
100 Portable
PCs
0 0
2000 2016 2000 2016

Tons of cathode active materials Li-ion 18650 cell price ($/Wh)

250000 3 2,6
211 000
200000
June 19th, 2017
2
San Francisco, CA, USA 150000

$/Wh
Tons

100000 1
50000 0,15
7 000

Christophe PILLOT 0 0
+ 33 1 47 78 46 00 2000 2016 2000 2016
[email protected] 2
Source: AVICENNE ENERGY, 2017
 THE WORLDWIDE BATTERY MARKET
1990-2016
Lithium Ion Battery: Highest growth & major part of industry
investments
120 000
Lithium ion battery raw
material supply & demand CAGR Li-ion 2010-2016: +25%
2016 - 2025 100 000

80 000
Others (Flow battery, NAS, …)
MWh

60 000 Li-ion
NiMH
June 19th, 2017
40 000 NiCD
San Francisco, CA, USA
20 000

0
Christophe PILLOT 1990 1995 2000 2005 2010 2015 2016
+ 33 1 47 78 46 00
[email protected] Source: AVICENNE ENERGY, 2017
3
 THE WORLDWIDE BATTERY MARKET
1990-2016
Lithium Ion Battery: Highest growth & major part of the investments
Lead acid batteries: By far the most important market (90% market share)
Lithium ion battery raw 400 000 500 000
material supply & demand 450 000
2016 - 2025 350 000
400 000
300 000 Others (Flow battery, 350 000
NAS, …)
250 000 Li-ion 300 000

MWh
200 000 250 000
MWh

NiMH
200 000
150 000 NiCD
June 19th, 2017 150 000
San Francisco, CA, USA 100 000 Lead Acid
100 000
50 000 50 000
0 0
1990
1995
2000
2005
2010
2015

Christophe PILLOT 2016

+ 33 1 47 78 46 00
[email protected] 4
Source: AVICENNE ENERGY, 2017
 THE WORLDWIDE BATTERY MARKET
1990-2016
69 BILLION US$ in 2016 – Pack level1
8% AVERAGE GROWTH PER YEAR (2006-2016)
Lithium ion battery raw 80 80
material supply & demand Others (Flow
70 70 OTHERS
2016 - 2025 battery, NAS, …)
Billion US $ 60 60 AUTOMOTIVE
Li-ion

Billion US$
50 50 INDUSTRIAL
40 40
30 NiMH 30 E-BIKES
20 20 POWER TOOLS
10 NiCD 10 PORTABLE
0 0
SLI
2014
1990
2000
2005
2010

2013

2015
2016

1990
2000
2005
2010

2013
2014
2015
2016
June 19th, 2017 Lead Acid
San Francisco, CA, USA
SLI: Start light and ignition batteries for cars, truck, moto, boat etc… INDUSTRIAL
PORTABLE: concumer electronics (cellular, portable PCs, tablests, • MOTIVE: Forklift (95%), others
Camera, …), data collection & handy terminals, • STATIONARY: Telecom, UPS, Energy Storage System, Medical, Others
(Emergency Lighting, Security, Railroad Signaling,, Diesel Generator
POWER Tools: power tools but also gardening tools Starting, Control & Switchgear,
AUTOMOTIVE: HEV, P-HEV, EV
Christophe PILLOT 1- Pack: cell, cell assembly, BMS, connectors – Power electronics (DC OTHERS: Medical: wheelchairs, medical carts, medical devices (surgical power
+ 33 1 47 78 46 00 tools, mobile instrumentation (x-ray, ultrasound, EKG/ECG, large oxygen
DC converters, invertors…) not included
concentrators
[email protected] 5
Source: AVICENNE ENERGY, 2017
 THE WORLDWIDE BATTERY MARKET
IN 2016: US $ 69 BILLION
80 000 14 000
EV, E-Bus

Portable 70 000 12 000

Lithium ion battery raw
material supply & demand SLI 60 000 Others
2016 - 2025 10 000
Others ESS
50 000 US $ 23
ESS Billion for 8 000 UPS

UPS 40 000 “other” Telecom

applications 6 000 Other Motive
Telecom
30 000 Forklift
Other Motive
4 000 Power Tools
June 19th,2017 Forklift 20 000
E-Bikes
San Francisco, CA, USA 2 000
Power Tools 10 000
E-Bikes
0 0
Lead Acid LIB Others
Christophe PILLOT 1- Pack level: Pack including cells, cells assembly, BMS, connectors – Power
+ 33 1 47 78 46 00 electronics (DC DC converters, invertors…) not included
[email protected] 6
Source: AVICENNE ENERGY, 2017
 LI-ION IN 2016 - MAIN APPLICATIONS
90 000 MWh - 23 B$ (1) CAGR 2006/2016
5 675 M small cells +23 % per year in Volume
2000: < 2GWh
Li-ion Battery sales,
Lithium ion battery raw MWh, Worldwide, 2000-2016 Portable Phones
material supply & demand 100 000 Electronics 17%
2016 - 2025 17%
90 000
80 000 Others
70 000 Portable PC
60 000 Industrial, 66%
M Wh

50 000 ESS
40 000 Auto, E-bus 2016: 90 GWh
30 000 China Auto, E-bus
June 19th, 2017 Excl. China
20 000 Auto, e-bus Auto, E-bus
San Francisco, CA, USA 17%
Excl. China China
10 000
33%
- Electronic
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
devices
Electronic
Christophe PILLOT devices Industrial, ESS
+ 33 1 47 78 46 00 (1) Cell level Others 5%
35%
[email protected] Others: medical devices, power tools, gardening tools, e-bikes… 10%
Source: AVICENNE Energy 2017 7
 LI-ION IN 2016 - MAIN APPLICATIONS
CAGR 2006/2016
+90 000 MWh - 23 B$ (1) +23% per year in Volume
5 675 M small cells Cell: +17% per year in value
Pack: +18% per year in value

Lithium ion battery raw Li-ion cells Li-ion Packs

material supply & demand M$, Worldwide, 2005-2016 M$, Worldwide, 2000-2016
2016 - 2025 25 000 35 000

30 000
20 000 Others
25 000
15 000 Industrial,

M$
M$

ESS
20 000

10 000 Auto, E-bus 15 000

China
June 19th, 2017 10 000
San Francisco, CA, USA 5 000 Auto, e-bus
Excl. China 5 000
- Electronic
devices -
2012
2005
2006
2007
2008
2009
2010
2011

2013
2014
2015
2016

2014
2005
2006
2007
2008
2009
2010
2011
2012
2013

2015
2016
Christophe PILLOT
+ 33 1 47 78 46 00 Others: medical devices, power tools, gardening tools, e-bikes…
[email protected] Source: AVICENNE Energy 2017 8
 LIB: THE BIGGEST PART OF THE COST
IS RAW MATERIALS
RAW MATERIALS ACCOUNT FOR 50 TO 70% OF LIB CELLS BUSINESS
RAW MATERIAL COST IMPACT DRASTICALY ON THE BATTERY MAKERS PROFIT
Lithium ion battery raw LIB Cost structure for TESLA & 40 Ah EV Average cost structure of Li-ion cell in 2016
material supply & demand pouch cell NMC
2016 - 2025 Cell Process
100% Margin Yield, Scraps
Production cost

Warranty 4%
90% Operating profit 3%
7%

80% Proces Yield Overheads

70% 3%
Depreciation Sales & Adm
60% 3%
Cathode cost
SGA, overhead
50% R&D 22%
R&D 6% Anode cost
40%
June 19th,2017 Energy, 6%
30% Utility
San Francisco, CA, USA utilities
Labor 4% Electrolyte
20% 6%
10% Direct labor
Material
4%
0% Depreciation Separator
14% 7%
Other
materials
Christophe PILLOT 11%
+ 33 1 47 78 46 00 Note: Average mix of cylindrical, prismatic & laminate cells
[email protected] Sources: AVICENNE ENERGY 2017 9
 LI-ION VALUE CHAIN – MARKET DEMAND
CATHODE
211 OOO T in 2016
Revenues: 4,75 B$ CELL PACK
CAGR 06/16: +14% MANUFACTURERS MANUFACTURERS

ANODE Revenues: Revenues:

Lithium ion battery raw 104 000 T 22,5 B$ 31 B$
material supply & demand Revenues: 1,16 B$
2016 - 2025 CAGR 06/16: +13% Gross margin: Gross margin:
<10% <10%
ELECTROLYTE
103 000 T
Revenues: 1,4 B$
CAGR 06/16 : 19%

SEPARATOR
June 19th,2017 1 500 M m²
San Francisco, CA, USA Revenues: 1,6 B$
CAGR 06/16 : 15%

ANCILLARY

Christophe PILLOT Revenues: 1,5 B$

+ 33 1 47 78 46 00
[email protected] Sources: AVICENNE ENERGY 2016 10
 LIB CATHODE MATERIAL

Cathode raw materials market

LiCoO2 (LCO)
Lithium ion battery raw LiMn2O4 (LMO)
material supply & demand
2016 - 2025
LiMPO4(1) (LFP)
Li[NixMnyCoz]O2 - NMC
Li[NixCoyAlz]O2 – NCA
Source: SANYO, March 2011
(1) M= Fe or Mn
Ni & Co price 2003-2015
150
Ni
June 19th, 2017 Co
San Francisco, CA, USA 100

$/kg
50

Christophe PILLOT
0
+ 33 1 47 78 46 00 ‘03 ‘04 ‘05 ‘06 ‘07 ‘08 ‘09 ‘10 ‘11 ‘12 ‘13 ‘14 ‘15 ‘16 ‘17
[email protected] Source: Mitsubishi, Batteries 2012 – Nice
Source: LME 11
 CATHODE ACTIVE
MATERIALS NEEDS
Cathode active materials for LIB in Tons, 2010- Rationales
2016 (Demand)
250 000
In 2016, LCO is used in pouch cells for
211 000
Lithium ion battery raw
200 000
electronic devices: smartphones,
material supply & demand
2016 - 2025
LFP tablets, ultra thin portable PCs
150 000
Tons

LMO
NMC is used in other electronic
100 000 NCA
67 000
devices & xEV
50 000 NMC
LCO
NCA is used by 18650 Panasonic cells
-
in Tesla cars and as a blend with LMO
2010

2011

2012

2013

2014

2015

2016
in other xEV
June 19th, 2017 LEADERS:
San Francisco, CA, USA LMO is mostly used as a blend with
NMC in xEV
LFP is used in xEV, e-buses in China
NEW ENTRANTS ON THE FIELD:
and for industrial applications
Christophe PILLOT
+ 33 1 47 78 46 00
[email protected] (…) 12
 LCO DEMAND: CAGR 2015-2025:+4%
LCO demand details LCO Offer in 2016
Others LCO: Tablets, Smartphones Others
ELEC
2%
70 000 OTHERS UMICORE
Easpring
Industrials 39%
CHINA 15%
60 000 9%
61%
50 000
E-bus Pulead NICHIA
40 000

Tons
12% 8%
30 000
Lithium ion battery raw xEV China ShanShan
20 000
material supply & demand 10 000
L&F 10%
16% Xiamen
2016 - 2025 xEV 0 Tungsten
B&M Reshine (XTC)

2010

2015

2020

2025
12% 9% 7%

LCO Price forecasts LCO summary of outlook

40 Demand:
LCO was used in most of the pouch cell lithium ion batteries for electronic
9 devices like smartphones & tablets.
30 Most OEM (Samsung, Apple, etc..) confirm that LCO will be the first choice
14 for the future.
June 19th,2017 6 5
$ / kg

7 Then, for portable PCs, penetration of LCO will increase thanks to thinner
San Francisco, CA, USA 20 high end portable PC using pouch cells.
29 LCO will not be used in large format cells where NMC is preferred.
10 19 19 21 21 Price: if the metal price are stable from 2016 to 2025, small
cost decrease thanks to scale economy.
0 Suppliers: Umicore, L&F, and main Chinese (Pulead,
2005 2010 2015 2020 2025 ShanShan, Reshine) will keep the lead. Not sure that Nichia
will stay at the top.
Christophe PILLOT Material Others
+ 33 1 47 78 46 00
[email protected] Assumption: 2016-2025 : Co price stable @ 28$/kg – Lithium
carbonate stable @ 10 $/kg – Co price @ 56$/kg in June 2017 ! Sources: AVICENNE ENERGY 2017 13
 NMC DEMAND: CAGR 2015-2025: +20%
OTH ELEC
NMC demand details IND NMC Offer in 2016
E-Bus
Others NMC: Electronics, EV, others Others
Industrials 350 000 8% UMICORE
Internal OTHERS
12%
E-bus 300 000 AUTO 14% 45% CHINA
55%
NICHIA
xEV China 250 000 Dahua
9%
200 000 Tianjiao 2%

Tons
xEV 6% ShanShan
150 000 12%
Lithium ion battery raw Power Tools, E-bikes Easpring
100 000 8%
material supply & demand Other Electronics Jinhe
50 000 Kelong Xiamen
2016 - 2025 Portable PCs 2% Pulead L&F 7%
0 Tungsten
9%
Smart Phones, Tablets 2010 2015 2020 2025 1% 10%

NMC Price forecasts NMC evolution

40 100%
811
30
$ / kg

50% 622
20
10 532
June 19th,2017 2010 2012 2014 2016 2018 2020 2022 2024 0% 111
San Francisco, CA, USA NMC 532 NMC 622 NMC 811 NMC 111 2010 2015 2020 2025
Assumption: 2016-2025 : Co price stable @ 28$/kg – Lithium carbonate stable @ 10 $/kg - – Ni stable @ 12$/kg / Co price @ 56$/kg in June 2017 !

NMC summary of outlook

Demand: Except xEV in China, NMC is driven by xEV: Nissan will switch from NCA-LMO to NMC for example. Then, Toyota, Mitsubishi, Honda all choose NMC. From
2012 to 2016 the clear trend was to switch from LMO-NMC 75/25 to LMO-NMC 25/75. LG, Panasonic and Samsung agreed that NMC will be the 1st choice for xEV first
in Japan, US and Europe, and then, in 2020 in China. Price will decrease thanks to process manufacturing improvement. Suppliers: Umicore, L&F, and main Chinese
Christophe PILLOT (ShanShan) will keep the lead. LG and Samsung will outsource more (Internal part will decrease). As new entrant, BASF try to be on this market since 2011. There
+ 33 1 47 78 46 00 market share may increase.
[email protected] Sources: AVICENNE ENERGY 2017 14
 NCA DEMAND: CAGR 2015-2025: +16% ELEC
OTH
NCA demand details NCA Offer in 2016 CHINA
7%
Others
NCA: Tesla IND AUTO Nihon Kagaku KELONG Others
Industrials 70 000 5%

Tons
Sangyo 2%
E-bus 60 000 5% OTHERS
93%

xEV China 50 000 ECOPRO

xEV 40 000 5%
30 000 TODA KOGYO
Lithium ion battery raw Power Tools, E-bikes
20 000 10%
material supply & demand Other Electronics
10 000
2016 - 2025 Portable PCs SUMITOMO
0 73%
Smart Phones, Tablets 2010 2015 2020 2025

NCA Price forecasts NCA evolution

50 100%
40
Material Others
Ni 90%
$ / kg

30 50%
20 Ni 87%
10
0 0% Ni 83%
June 19th, 2017
2010 2015 2020 2025 2010 2015 2020 2025
San Francisco, CA, USA
Assumption: 2016-2025 : Co price stable @ 28$/kg – Lithium hydroxide stable @ 12 $/kg - – Ni stable @ 12$/kg BUT Co price @ 56$/kg in June 2017 !

NCA summary of outlook

Demand: NCA are also used in electronic devices, in prismatic and cylindrical cells. Main NCA users in electronic devices are Panasonic, Sony and Samsung. They will
keep using NCA but LCO will stay the first choice. Panasonic and Samsung confirm that they supply more and more power tools mfg with NCA (from 15% in 2015 to
25% in 2025). Other NCA usage is of course for the TESLA. We do not think TESLA will switch for another technology in the next years.
Christophe PILLOT
Price decrease thanks to better mfg. process
+ 33 1 47 78 46 00
Supplier: Sumitomo will keep the lead thanks to Panasonic / Tesla. Toda Kogyo market share will probably increase thanks to BASF partnership.
[email protected] Sources: AVICENNE ENERGY 2017 15
 LFP DEMAND: CAGR 2016-2025:+8%
LFP demand details OTH AUTO LFP Offer in 2016 OTHERS
8%
Others LFP: Industrial, E-Bus BTR Energy BYD
IND Kelong 3% 8%
Industrials 140 000 E- Internal
2% STL 27%
BUS CHINA
E-bus 120 000 Zhuoneng 5% 92%
6%
xEV China 100 000 Tatung Others
80 000 1% 28%

Tons
xEV
ALEEES JOHNSON
Lithium ion battery raw 60 000
3%
Power Tools, E-bikes MATTHEY Pulead
material supply & demand 40 000 4% 13%
2016 - 2025 Other Electronics
20 000 Internal: BYD, Hefei Guoxuan High Tech Power source (Gxgk), Huanyu Power
Portable PCs 0 Source Co., Ltd., LG, A123 (Wanxiang EV Co., Ltd), Hi Power - Others: Hunan
Haorun Technology, Henan Tianke, Likai , Tiehu Energy and many others
Smart Phones, Tablets 2010 2015 2020 2025

LFP Price forecasts LFP summary of outlook

30 LFP demand is driven by xEV, E-Bus in China, e-bikes and
25
Stationary application. Chinese industrial agreed that E-bikes, e-
bus and stationary app will use LFP for the next 10 years. The
20 cost and the life time are the main criteria and Energy density is
June 19th, 2017
$ / kg

15 not so important. Then, Chinese xEV mfg. (BYD, Kandi, Zotye,

San Francisco, CA, USA
10 Baic, Chery…) told us that they will switch from LFP to NMC.
5 Price: Process manufacturing cost will decrease. Pulead forecast
price @ 11-12$/kg in 2025.
0
2010 2015 2020 2025 Suppliers: Pulead will probably increase market share thanks to
Material Others new contract with BYD and others Chinese battery mfg.
Christophe PILLOT
+ 33 1 47 78 46 00
[email protected] Assumption: 2016-2025 : Lithium carbonate stable @ 10 $/kg
Sources: AVICENNE ENERGY 2017 16
 LMO DEMAND: CAGR 2015-2025:-12%
LMO demand details LMO Offer in 2015
Others Nippon
LMO: AUTO POSCO ESM Nichia
Industrials 16 000 5% Denko OTHERS
12% 40%
E-bus 14 000 4% CHINA
AUTO Yuan Yuan 60%
12 000 Mitsui
xEV China 5%
10 000 12%

Tons
xEV 8 000 JGC
Lithium ion battery raw OTH
Power Tools, E-bikes 6 000 12%
material supply & demand 4 000
Other Electronics
2016 - 2025 Reshine
2 000 Qyanyun
Portable PCs 9% Others ShanShan
0 18% 14%
Smart Phones, Tablets 9%
2010 2015 2020 2025

LMO Price forecasts LMO summary of outlook

15 Demand: LMO is almost never the first choice for Lithium ion
cathode. But, LMO is low cost and bring stability to the cathode.
LMO is used in power tools and will be used, blended with NMC.
10 So, for the future, LMO demand will be mostly driven by
June 19th, 2017
$ / kg

San Francisco, CA, USA NMC/LMO blended cathode used in EV worldwide, EV in China
5 to replace LFP (2020) and later E-bus in China (2025).
Price: LMO price decreased a lot from 2010 to 2015. We think
we almost achieve the lowest possible level.
0
2010 2015 2020 2025 Suppliers: Most of the supply will stay in China (ShanShan,
Material Others Qyanyun, …).
Christophe PILLOT
+ 33 1 47 78 46 00
Assumption: Lithium carbonate price 2016 – 2025 stable @ 10 $/kg
[email protected] Sources: AVICENNE ENERGY 2017 17
 CATHODE ACTIVE MATERIAL
FORECASTS 2000-2025
Cathode active materials Cathode active materials in 2016
2000-2025 - Tons > 210 000 Tons
600 000 80%
Lithium ion battery raw LCO
70% LFP 21%
material supply & demand 500 000
2016 - 2025 60% 36%
400 000 NMC
50%
LMO NCA 26%
Tons

300 000 40% 8% 9%

30%
200 000 Cathode active materials in 2025
20%
100 000
540 000 Tons
10% LFP
LCO
21%
- 0% 12%
June 19th, 2017 2000 2005 2010 2015 2020 2025 LMO
1%
San Francisco, CA, USA LCO NMC NCA LMO LFP China (%)
NCA
ASSUMPTIONS: 12% NMC
Portable devices: 54%
2015-2025: +6% per year in volume
HEV: 2,5 M HEV/year in 2020, 3,3 M HEV in 2025 Assumption: Tesla keep NCA chemistry and have a relative success
Christophe PILLOT P-HEV: 0,4 M P-HEV/year in 2020, 0,7 M in 2025 (+250 000 EV sold per year in 2025 – TESLA forecast 500 000)
+ 33 1 47 78 46 00 EV: 0,4 M EV/year in 2020 + 0,7 M in China, 0,7 M/year + 1 M in China in 2025, 100% LIB
[email protected] Industrial & stationary: 2015-2025: +16% per year
18
 ANODE ACTIVE MATERIALS
104 000 TONS IN 2016
LIB Anode Materials

Lithium ion battery raw

material supply & demand
2016 - 2025

Source: Hitachi Chemical

Source: A. Jossen, IRES 2007

LIB Anode Materials LIB Anode market, (Tons)

120000
1,5 LTO
June 19th,2017 100000
San Francisco, CA, USA 80000 Si or Sn Type
1,0
60000

Tons
40000 Amorphous Carbon
0,5
20000
Artificial Graphite
0
0,0

2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Christophe PILLOT Natural Graphite
+ 33 1 47 78 46 00 0 500 1000 1500 2000 2500
[email protected] Source: Sanyo, March 2013 Sources: AVICENNE ENERGY 2016 19
 ANODE FOR LIB IN 2016
Natural graphite become a commodity

Hard Carbon Soft Carbon Graphite

Capacity (/g) 400 mAh/g 250 mAh/g 325-375

mAh/g
Capacity
++ 0 +
Lithium ion battery raw (/cc)
material supply & demand Power ++ + 0
2016 - 2025
Stability ++ + 0
Source: Hitachi Chemical
Cyclability ++ + 0
Precursors Petroleum Petroleum Natural or
Pitch, Resin, coke petroleum
Carbon for LIB anodes by type (2016) cellulose, coke
Amorphous wood,
Artificial coconuts…
Graphite 7%
43% Si or Sn Type COST 25 -> 20 $/kg 20->15 $/kg 7-13-> 6-10
June 19th, 2017 LTO 2% 2015->2020 $/kg
Natural 2%
San Francisco, CA, USA SUPPLIERS KUREHA HITACHI HITACHI
Graphite
46% BTR…

LEADERS: NEW ENTRANTS ON THE FIELD:

Christophe PILLOT
+ 33 1 47 78 46 00
(…)
[email protected] 20
Sources: AVICENNE ENERGY 2017
 NATURAL GRAPHITE: CAGR 2015-2025: +4%
Natural Graphite demand details NG Offer in 2016
Others HITACHI
OTHERS
70 000 POSCO 16% 11% 35%
60 000 Chemtech
CHINA
50 000 4% 65%
40 000

Tons
Nippon
Lithium ion battery raw 30 000 Carbon
Shenzhen Typical Product
material supply & demand 20 000 4% D50= 16 mm
2016 - 2025 BTR
10 000 350 mAh/g
Mitsubishi 49% 5% irreversible cap.
0 16% BET: 1m²/g
2005 2010 2015 2020 2025

NG Price forecasts NG summary of outlook

16 Demand: small growth because new app. Need artificial Gr. This
demand may change if the price decrease is more important for NG
14 compare to AG. Price: The price will decrease fast because the supply is
12 huge. Already over supply in China ( Capacity: BTR 30 000 Tons, Zichen:
June 19th, 2017 10 000 Tons, Shinzom: 10 000 Tons, Sinuo: 8 000 Tons, Qingdao: 8 000
10
San Francisco, CA, USA
$ / kg

Tons, Jianxi Zhentuo: 7000 Tons, Kimwan: 5 000 Tons…). Then, a lot of
8
new projects in China and Canada: Focus Graphite > 40000 Tons/year
6 (2020*), Northern Graphite > 20 000 Tons/year (after 2018*) Syrah
4 Resources Ltd. > 80 000 Tons (2020*)
2 Suppliers: BTR and new Chinese (Zichen thanks to ATL, - Shinzom
thanks to BYD, CATL – Sinuo etc…). New entrant like Focus Graphite,
Christophe PILLOT 0 Northern Graphite, or Syrah Resources Ltd. May change the market
+ 33 1 47 78 46 00 2010 2015 2020 2025 share in the future
[email protected] Sources: AVICENNE ENERGY 2017 * Subject to financing 21
 ARTIFICIAL GR.:CAGR 2015-2025: +15%
Artificial Graphite demand details Artificial Graphite Offer in 2016
160 000 Showa Others
CHINA
140 000 Denko 6% OTHERS 45%
120 000 5% 55%
JFE
100 000 11% HITACHI

Tons
80 000
31%
Lithium ion battery raw 60 000 Mitsubishi
Typical Product
material supply & demand 40 000 9%
D50= 20 mm
2016 - 2025 20 000 Shanshan 365 mAh/g
0 38% 1-5% irreversible cap.
2005 2010 2015 2020 2025 BET: 0,5m²/g

Artificial Graphite Price forecasts Artificial Graphite summary of outlook

Demand: The demand will increase fast thanks to xEV market. Long life
25 time requirement involve high level of purity and high consistancy,
difficult to achieve with Natural Graphite.
20
Price will decrease fast thanks to better process efficiency, new process
June 19th, 2017 Supply: Thanks to the best quality, Hitachi will keep the lead but
San Francisco, CA, USA 15
$ / kg

Chinese main suppliers market share will increase (ShanShan mostly).

10 Production Capacity: Hitachi: 15 000 Tons, ShanShan:
15 000 Tons project in Lingang Park (Shanghai) to add
20 000 Tons/year, Mitsubishi: 7 000 Tons, JFE: 7000 Tons, Showa
5
Denko: 3000 Tons

Christophe PILLOT 0
+ 33 1 47 78 46 00 2010 2015 2020 2025
[email protected] Sources: AVICENNE ENERGY 2017 22
 LIB SEPARATOR MARKET 2016
In February 2015, ASAHI announced that they will acquire all Polypore shares in the Energy Storage
segment: Asahi Kasei to pay around $2.2billion to purchase Polypore’s battery separator business

LIB separator market, M$ - CAGR 2006/2016: +15% Supplier, market share in 2016
1800 W-Scope
Jinhui
6%
Lithium ion battery raw 1600 4% ASAHI
material supply & demand 17%
2016 - 2025 1400

1200 Others
19% TORAY
1000
15%
800

600 Green
3% SUMITOMO
400 6%
June 19th,2017 Senior
San Francisco, CA, USA 200 3% SK ENTEK
UBE
CELGARD 9% 4%
6%
0 8%
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Christophe PILLOT M$ Mm² Others: Shanghai Energy, Newmi, JGP, TDK, In house (BYD),
+ 33 1 47 78 46 00 Mingzhu, Tianfeng, Yiteng, BNE…
[email protected] Sources: AVICENNE ENERGY 2017 23
 ELECTROLYTE SUPPLIERS/CUSTOMERS
103 000 TONS IN 2016
LIB electrolyte market, Tons, LIB electrolyte supplier, market share in
CAGR 2006/2016: +28% 2016

Lithium ion battery raw 120000 TINCI Others Ube

material supply & demand 6% 5% 4% Mitsubishi
2016 - 2025 100000 Soulbrain 12%
5%
80000 Shanshan
8% In-House
Tons

60000 9%
Tomiyama
Capchem 3%
40000
14%
PANAX-ETEC
20000 8%
June 19th,2017 Jinniu
San Francisco, CA, USA 8% Zhangjiagang
0 Mitsui
2000 2002 2004 2006 2008 2010 2012 2014 2016 3% Guotai-
Huarong
Portables electronics Power Tools 15%
E-bikes Automotive (12v, HEV, PHEV, EV)
Christophe PILLOT Auto & E-Bus China Industrial
+ 33 1 47 78 46 00
[email protected] Sources: AVICENNE ENERGY 2017 Note: (1) GTHR: Zhangjiagang Guotai-Huarong 24
 2025 LIB FORECASTS FOR PORTABLE
ELECTRONIC DEVICES
2000-2025 LIB market, MWh, by 2000-2025 LIB market, M cells,
application (3C) by form factor (3C)
Lithium ion battery raw
CAGR 16-25: + 6% 6000
material supply & demand
2016 - 2025 60000
5000
50000 Other Portable
Electronics 4000

M cells/year
40000
Tablets
3000
30000
MWh

Portable PCs 2000

20000
June 19th,2017
San Francisco, CA, USA Cellular Phones 1000
10000

0
0
2000 2005 2010 2015 2020 2025
2005
2000

2010
2015
2020
2025

Li-P Li-ion Pr
Christophe PILLOT Li-ion Cyl Takeshita - March 2013 (1)
+ 33 1 47 78 46 00
[email protected] Source: AVICENNE ENERGY Analyses (1) Source: Takeshita, Battery Japan 2013 BJ-3 conference Slide p 4 25
 CAGR 2016-2025:+ 17%
X-EV MARKET 200 000
185 GWh
Why x-EV ? 180 000

Definition & segmentation 160 000

X-EV worldwide in 2016 140 000 E-buses

Lithium ion battery raw
By country

MWh for Auto & E-buses

material supply & demand
2016 - 2025 120 000 PHEV & EV in
110 GWh
By car makers China
100 000 EV
By battery chemistry
X-EV forecasts 80 000 PHEV

AVICENNE ENERGY & other 60 000

45 GWh
HEV

June 19th, 2017 analyst forecasts 40 000

San Francisco, CA, USA
Battery chemistry forecasts 20 000
Battery cost forecasts
-
Christophe PILLOT X-EV battery forecasts 2016 2020 2025
+ 33 1 47 78 46 00
[email protected] 26
 LIB MANUFACTURING INVESTMENTS 2009-2015
10-12 B$ WORLDWIDE >50 GWh invest from 2011 to 2014)
> 7 B$ invested from 2014 to 2017 by TESLA (5), BYD (1,2), ATL (1)
Total Investment (M$) made for LIB manufacturing
ATL (2014 - 2017)
BYD (2013 - 2015)
TESLA (2014-2017)

LiTec GmbH
Lithium ion battery raw Panasonic EV (Invest end 2016)
SK Energy
material supply & demand Mitsubishi H.I.
2016 - 2025 NEC Tokin
AESC Japon
Hitachi Vehicle Energy 2014 – 2017
SAFT
SAFT US TESLA, ATL, BYD TESLA Plant, Nevada, Feb 2015
BAK
Lishen
Investments:
Nissan-Renault (Port) 150 $ / kWh
Blue Energy
Toshiba
Nissan - Renault (UK)
LG Chem
Rusnano-Thunder Sky
Lithium Energy Japan
Hitachi Vehicle Energy
June 19th, 2017 SB Limotive
GS YUASA
San Francisco, CA, USA Dow Kokam
Nissan-Renault (Fr) Average 2012-2014
Ener1
Sanyo Investments:
A123 250 $ / kWh
JCI
LG Chem
BYD
Sony
Christophe PILLOT NISSAN Motor US
+ 33 1 47 78 46 00 PANASONIC
M$ TESLA GIGA FACTORY, Dec 2016
[email protected] 0 1000 2000 3000 4000 5000 6000 Source: AVICENNE ENERGY Analyses 2017 27
 LITHIUM ION CELL PRODUCTION
Korean companies start to move in Malaysia
New production capacity in Europe and US

$ 562 M
3-5 GWh
$ 562 M $ 360 M $ 600 M
3-5 GWh 2-3 GWh 1 GWh
$ 1 700 M (1)
25 GWh
Korea – 17%
Lithium ion battery raw 2018 2018 2018 2019 2025 SAMSUNG
material supply & demand $ 5 Bn LG
2016 - 2025 35 GWh SK
2017
EU -<1% Kokam
SAFT
USA – 2% FIAMM
BOLLORE China – 53%
LG
Johnson-Controls BYD
Japan – 20%
Panasonic
Enersys GP Sony
SAFT Lishen NEC
COSLIGHT Maxell
ATL PEVE
June 19th, 2017 BAK YUASA
San Francisco, CA, USA B&K
Wanxiang (A123) Others* – 7%
SAMSUNG
LG
Source: AVICENNE 2017
Christophe PILLOT
+ 33 1 47 78 46 00 * OTHERS: Malaysia mostly
[email protected] (1) Government subsidies only
28
 TIME TO MARKET FOR NEW MATERIALS
IN LIB INDUSTRY

Lithium ion battery raw

material supply & demand
2016 - 2025
The research and development in this industry is very long and time
consuming.
Time to market to commercialize a new material is long. Remember that
the first Li-ion battery was launched by Sony in 1991 with LCO cathode,
graphite, LiPF6 electrolyte & polyolefin membrane. It was 20 years ago.
June 19th, 2017
LTO was invented by Matsushita in 1993 (22 years ago)
San Francisco, CA, USA Lithium iron phosphate was invented in 1995 (20 years ago).
So, it takes between 10 & 20 years to commercialize a new material in the
battery industry.
Christophe PILLOT
+ 33 1 47 78 46 00
[email protected] 29
 TIME TO MARKET FOR NEW MATERIALS

Lithium ion battery raw

material supply & demand
2016 - 2025

June 19th, 2017

San Francisco, CA, USA

Christophe PILLOT
+ 33 1 47 78 46 00
[email protected] Source: AVICENNE ENERGY 2016 30
 SAFETY ISSUES
Li-ion and LMP are not thermally stable what raises serious safety
concerns

Background
In the 80’s, lithium metal batteries were put into the markets (Moli Energy). Their further
development has for a long time been slow because of a low cycle efficiency and safety issues: High
chemical reactivity and a low melting point enable strong chemical reactions, even explosions. In the
Lithium ion battery raw charging-discharging process, lithium metal can form dendrite and accumulate on electrodes. The
growing lithium dendrite could puncture the separator and result in an internal short circuit.
material supply & demand Except BOLLORE, all the companies developing Li metal batteries cancelled their projects
2016 - 2025
Li-ion batteries for mobile devices mostly used a Lithium Cobalt Oxide Cathode and liquid
Mobile
electrolyte.
In case of overcharging or short-circuit (contact between anode & cathode) a chain reaction
starts -> heating & gasing -> fire (“Thermal runaway”)
In 2006, SONY had to recall millions of portable PCs for total costs of 400 million USD, more
than there profit-to-date
Automotive

With new cathode chemistry, most of the automotive today on the markets experienced safety
concerns: (1) BYD Taxi in China with a lithium iron phosphate cathode (2) GM Volt in the US with a LG
Chemical battery using LMO cathodes (as a result of a crashed tested Chevrolet Volt caught three
weeks after the testing !) (3) PRIUS P-HEV in the US (converted from HEV Prius by a local engineering
June 19th, 2017 company without any authorisation by Toyota)
San Francisco, CA, USA
Boing 787: The fire that burned near the tail of a parked Boeing 787 in Boston was caused
Aircraft

by an overheating Lithium ion battery pack. The battery fire could have been hot enough to
melt the carbon-fiber reinforced plastic that makes up the plane’s shell.
CONSEQUENCES: All the 787 worldwide are grounded. Considerable losses for Boing.

Christophe PILLOT
+ 33 1 47 78 46 00
[email protected] Source: AVICENNE ENERGY 2016
31
 LI-ION BATTERY COST
2015-2025
LIB cell average cost (40 Ah pouch) LI-ION BATTERY PACK COST FOR
(EV design ; NMC cathode) EV
450 400
Lithium ion battery raw Pack Cost
material supply & demand 400 Margin 350
2016 - 2025 Warranty Cell
350 300
Overheads Manufacturing
300 Sales & Adm Other Materials
250
R&D
$ / kWh

250 Energy, utilities

$ / kWh
200
Direct labor Separator
200 Depreciation 150

150 Scraps Electrolyte

June 19th, 2017 100
Others
San Francisco, CA, USA 100 Separator 50 Anode
Electrolyte
50 Anode (1) 0
Cathode

Cell
Cell
Cell
Pack

Pack
Cathode (1)

Pack
0
Christophe PILLOT 2010 2015 2020 2025 2015 2020 2025
+ 33 1 47 78 46 00
(1) Active materials only
[email protected] Source: AVICENNE ENERGY 2016 * For Production > 100 000 packs/year 32
 LIB PRICE FORECASTS

Lithium ion battery raw

material supply & demand
2016 - 2025

Avicenne Energy

June 19th, 2017

San Francisco, CA, USA

Christophe PILLOT
+ 33 1 47 78 46 00
[email protected] Source: Rapidly falling costs of battery packs for electric vehicles, Nature Climate Change , March 2015 33
 HEV, P-HEV, EV 2025 FORECASTS

HEV manufactured PHEV manufactured EV manufactured

4,5 100% 1,2 2,5 70
Lithium ion battery raw 4 90% 1,05
material supply & demand 1
2 60
2016 - 2025 80% 2
3,5
70% 50
3 0,8
0,8

Million cars
Million cars

Million cars
60% 1,5

% Li-ion HEV
40

kWh / EV
2,5 0,65
0,8 1,25
50% 0,6
2 3,9 30
40% 1 0,45

1,5 3,0 0,4 0,35 0,5

June 19th, 2017 30% 20
San Francisco, CA, USA 2,1 1,2
1 0,5 0,45
20%
0,2 0,3 0,8
0,24
10
0,5 1,1 10% 0,2
0,1 0,18
0,08 0 0,02 0
0 0% 0
Christophe PILLOT 2010 2015 2020 2025 2010 2015 2020 2025 2010 2015 2020 2025
+ 33 1 47 78 46 00
[email protected] HEV: 1kWh battery / car PHEV: 12 kWh battery / car 34
 TOTAL BATTERY DEMAND
2025 FORECASTS
Li-ion for EV, HEV & P-HEV Battery Li-ion for EV, HEV & P-HEV Battery
needs (MWh) needs (M$)
CAGR 2016-2025: +17% CAGR 2016-2025: +12%
Lithium ion battery raw
material supply & demand 200 000 30000
2016 - 2025 180 000
25000
160 000
140 000
20000
120 000
100 000 15000

M$
M Wh

80 000
June 19th,2017 10000
60 000
San Francisco, CA, USA
40 000
5000
20 000
- 0
2010 2015 2020 2025 2010 2015 2020 2025
Christophe PILLOT
+ 33 1 47 78 46 00 12-48 volts SLI HEV PHEV 12-48 volts SLI HEV PHEV
[email protected] EV EV & PHEV China E-bus China EV EV & PHEV China E-bus China 35
 X-EV BATTERY MARKET
2000 – 2025 IN M$
Cell Level Pack Level
CAGR 2016-2025: +12% CAGR 2015-2025: +11%
Lithium ion battery raw 30000 40000
material supply & demand
35000
2016 - 2025 25000
30000
20000
25000

15000 20000
M$

M$
15000
10000
10000
June 19th, 2017
San Francisco, CA, USA 5000
5000

0 0
2010 2015 2020 2025 2010 2015 2020 2025
12-48 volts SLI HEV PHEV 12-48 volts SLI HEV PHEV
Christophe PILLOT EV EV & PHEV China E-bus China EV EV & PHEV China E-bus China
+ 33 1 47 78 46 00
[email protected] 36
 LI-ION BATTERY MARKET FORECASTS
From 90 GWh in 2016 to 300 GWh CAGR 2016/2025
+15 % per year in Volume
Li-ion Battery sales,
MWh, Worldwide, 2000-2015
350 000 2016: 90 GWh
Lithium ion battery raw Auto, E-bus Auto, E-bus
material supply & demand Excl. China China
300 000 13% 30%
2016 - 2025 CAGR 15/25
(Realistic)
250 000
Others 16% Electronic
M Wh

Industrial, ESS
200 000 devices
40% Others 6%
Industrial, ESS 22% 11%
150 000

Auto, E-bus China 22%

2025: 300 GWh
100 000
June 19th,2017 Auto, E-bus
San Francisco, CA, USA Auto, E-bus China
50 000 Auto, e-bus Excl. 17% Excl. China 43%
China 21%
-
Electronic devices 6% Industrial, ESS
2000
2005
2010
2015
2020
2025

Electronic 7%
devices Others
Christophe PILLOT
18% 11%
+ 33 1 47 78 46 00 Others: medical devices, power tools, gardening tools, e-bikes…
[email protected] 37
Source: AVICENNE Energy 2016
 LI-ION BATTERY MARKET FORECASTS
CAGR 2016/2025 +13 % per year in Volume
Cell: +7% per year in value
Pack: +8% per year in value
Li-ion cells Li-ion Packs
Lithium ion battery raw M$, Worldwide, 2000-2025 M$, Worldwide, 2000-2025
material supply & demand 40 000 50 000
2016 - 2025 CAGR 15/25 45 000
35 000
Others 11%
40 000
30 000
35 000
25 000 Industrial, 11%

M$
M$

ESS 30 000
20 000 25 000
Auto, E- 12%
15 000 bus China 20 000
June 19th,2017 Auto, e- 15 000
10 000 8%
San Francisco, CA, USA bus Excl.
10 000
5 000 China
Electronic 0% 5 000
- devices
-
2000

2005

2010

2015

2020

2025

2000

2005

2010

2015

2020

2025
Christophe PILLOT
+ 33 1 47 78 46 00 Others: medical devices, power tools, gardening tools, e-bikes…
[email protected] Source: AVICENNE Energy 2016 38
 TAKEAWAYS
Battery Market 2015-2025 RECHARGEABLE BATTERY MARKET
CAGR = +6% / Li-ion>+10% WORLDWIDE 2000-2025
847GWh
Li-ion battery is driven today by Automotive & Industrial
applications 628 GWh Others
In 2012, most of the car makers (except Toyota) switch to Li-

MWh
ion for HEV 432 GWh LIB
325 GWh
Lithium ion battery raw P-HEV, EV and E-buses will be powered by Li-ion: NiMH
210 GWh
material supply & demand 15 B$ market in 2016 - 28 B$ in 2020 & 38 B$ in 2025 with
2016 - 2025 NiCd
high numbers in China (2016: US$ 3,6 Billion for xEV and US$
4,8 Billion for xE-Buses) Lead Acid
EV expectations attract large Chemical companies 2005 2010 2015 2020 2025
New materials are needed to meet Automotive standards > 115 B$
2,8
HEV will account for less than 3% of the auto sales in 2020 (Pack level) 94 B$ 17
P-HEV & EV < 2% by 2020
Micro-hybrid will achieve >50% in 2020/25 63 B$ 38
Lead acid battery will be the first market in 2025 in volume, 43B$ 10
but Li-ion market will be higher than Lead acid from 2020. 30B$
June 19th,2017 25B$
A very small EV market in the automotive world will represent 49
San Francisco, CA, USA
a huge market for batteries
New LIB applications: UPS, Telecom, Forklift, Medical, 2000 2005 2010 2015 2020 2025
Residential ESS, Grid ESS: CAGR > 10% in the next 15 years Lead Acid (+4%) NiCd (-6%)
NiMH (-7%) LIB for 3C (+0%)
Lithium battery for other application (ESS, stationary, LIB for xEV (+13%) LIB for Others* (+12%)
industrial…) will reach 10 Billion $ market at the pack level in
Christophe PILLOT the next 5 years (CAGR 2016-2025)
+ 33 1 47 78 46 00 Others: Automatic handling equipment, forklifts, back-up, UPS,
ESS market could be much more important if the price of LIB
[email protected] Telecom, medical devices, Residential ESS, Grid ESS, … 39
at the system level is under 150 $/kWh
 THANK YOU

Mike SANDERS
Lithium ion battery raw
AVICENNE ENERGY
material supply & demand PHOTO
2016 - 2025 E-mail:
Phone:
Mobile:

June 19th, 2017

San Francisco, CA, USA

Christophe PILLOT
+ 33 1 47 78 46 00
[email protected] 40