John Voelcker at Green Car Reports, in an article today argues
it will never happen. () . John is a very smart, well read and well respected writer on Green Cars, but, I have to say
“Never, say Never”. Battery swapping for EV’s won’t happen right now, but, it will likely happen in the next 7-10 years.
Voelcker very correctly points out that today, batteries are proprietary, custom and individualized. That’s driven because Battery
technology is still immature relative to the problems of EVs. An EV is a very tough problem for a battery, they need high discharge currents,
to accelerate and brake, they need big energy storage, ideally up to 100 KWH, they need high charging rates, L-3 or better, they need to be
affordable ( <$250/KWH) they need to withstand broad environmental challenges ( Florida, Arizona, Alaska) and Rough roads, impacts,
shock, and to be maintainable by technicians not surgeons.
The Problem is EV battery Technology is still below the performance level that customers can utilize or absorb.
EV battery is on the Blue Line well below the average performance demands of customers. We are all EV fans, but
lets be honest, when we are talking to our friends, family members or strangers, they say “EVs cost too much” or “EV’s dont’
have enough range” or “I need a vehicle that can tow my boat”. Those are all valid, reasonable statements by Median
consumers. EV drivers today are early adopters, willing to accept higher prices and lesser performance for some new
feature. Wether that new feature is “Cool”, “Quiet”, ” Tech”, “Clean”, “Green”, “Torque” Current EV drivers are
on the blue line on the early part of a sustaining innovation curve.
Electric Vehicle batteries as shown above, are still above the Median Performance Demand curve. That means
to improve the user experience the battery, Charger, Vehicle, must be heavily integrated in order to meet the total user demand.
Wether that was a Cabinet Hi-Fi, a Mainframe Computer from IBM or a Tesla Model S or an Apple iPod in 2002, the providers
needed to integrate the user experience, with extensive customer support, and system integration. Back in the 1950’s when you
bought a Hi-Fi stereo, technicians from the dealer would come to your home and tune the speakers to your room acoustics. In the 1960’s IBM
was noted for the extensive customer support provided by the IBM field organization and Apple provided a glorious
customer experience with the iPod and iTunes. Tesla has captured this dynamic with their Tesla stores and Supercharger Network.
Now none of this is cheap. IBM, Apple, Tesla, these were the high end, high margin companies and products chasing the top end.
Judging by Bloombergs public statements, this chase will be on full bore at least until 2020. We will see things like GM struggling
to increase the all-electric range of the Volt, Nissan trying to improve price/performance of the Leaf, Tesla moving out new models.
However as volumes increase and performance overshoot begins to happen, price points will have to decline.
That will push EV manufacturers to drive battery manufacturing into more of a commodity business. Suppliers will produce
Modular, commoditized batteries just as Intel began producing Modularized, commoditized CPU chips and memory chips.
It will become less and less competitive to be vertically integrated and vehicle manufacturers will move to a standard modular
When that happens, then Battery swapping can become a reality. It’s possible High End specialty manufacturers will grow
an ecological niche sufficiently large to support a proprietary swapping station, but, the main stream application of this will
happen sometime 2020 or beyond. At that point, Shai Agassi will no doubt receive a well deserved bottle of champagne
from John Voelcker.
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