(SSDIY), NIO Inc. (NYSE: NIO) – Samsung targets Tesla, Nio with lithium-ion phosphate battery development: Korea Herald

  • Samsung SDI Co Ltd (OTC: SSDIY) develops lithium-ion phosphate (LFP) batteries at the company’s research and development center in Suwon, Gyeonggi province, Korea Herald Reports.
  • LFP batteries offer lower prices and stability by using phosphoric acid and iron as attractive raw materials Tesla Inc (NASDAQ: TSLA) and NIO Inc (NYSE: NIO). They are relatively more immune to the risk of fire, have a lower energy density and a higher weight.
  • Chinese companies mainly manufacture them. In contrast, lithium-ion batteries contain expensive metals such as nickel, cobalt, and manganese.
  • Samsung aims to tap the rising demand for energy storage systems. Energy storage systems are huge batteries that store excess electricity generated by renewables.
  • In 2020, Samsung SDI controlled 31% of the global ESS market. Therefore, the dominant status of Samsung SDI is made also vulnerable as ESS trends gradually shift towards LFP batteries.
  • The share of LFP batteries in the global battery market is likely to increase from 10% in 2015 to 30% in 2030. During the same period, lithium-ion batteries will likely increase from 70% to 30%.
  • The dominance of LG Energy Solution and CATL in the lithium-ion battery market explains Samsung’s decision.
  • The battery sector suffers from high recall risks. The cost reduction is limited as the minerals account for 60% of the total costs at the top. Thus, the company only benefits from an operating margin of 10% compared to a 30% margin for the chip.

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