sources, Energy News, ET EnergyWorld

SHANGHAI (Reuters) – China’s EVE Energy Co Ltd will supply BMW with large cylindrical batteries for its electric cars in Europe, two people with knowledge of the matter said, as the German automaker follows Tesla Inc in adopting the new technology.

EVE has signed contracts to be BMW’s main battery cell supplier in Europe for its new series of electric vehicles due to hit the market from 2025, one of the people with direct knowledge of the company said. ‘OK.

Tesla this year began manufacturing its new, larger 4680 cylindrical battery, 46 millimeters in diameter and 80 millimeters in length. He said he expects the battery to reduce production costs and improve battery life compared to the current-generation 2170 cylindrical battery.

The Guangdong-based EVE batteries will be similar in size, said the sources, who were not authorized to speak to media and declined to be identified.

Company filings also show that EVE is planning a large cylindrical battery factory in central China.

EVE, a BMW supplier in China, did not respond to a request for comment. BMW said it plans to release battery information in early September, but declined to comment further.

The change from BMW, which currently uses prismatic batteries, underscores the growing momentum for larger format cylindrical batteries. Prismatic batteries, which are rectangular in shape, have become the most common automotive battery shape over the past couple of years because they can be packed more densely, helping to reduce costs. But proponents of cylindrical batteries say the new, larger-format cells have become more cost-effective due to improvements in energy density.

China’s CATL, the world’s largest battery maker, is also expected to start supplying cylindrical batteries to BMW from 2025.

These batteries are also expected to be large cell sizes. CATL did not respond to a request for comment on the planned dimensions.

It was not immediately clear how many batteries BMW was planning to source from EVE and CATL.

EVE’s deal with BMW prompted the Chinese company to announce in March that it would build a cylindrical battery production plant in Debrecen, Hungary – its first plant in Europe, according to the person with direct knowledge of the company. OK.

BMW is also building a factory in the same city where it plans to produce electric vehicles developed on its Neue Klasse platform.

Government incentives are boosting demand for electric vehicles in Europe and the United States, prompting Chinese battery and electric vehicle makers to accelerate plans to set up production bases overseas.

CATL announced last week that it would build Europe’s largest battery plant with an annual capacity of 100 gigawatt hours, also in Debrecen, to supply European automakers. Mercedes-Benz will be its biggest customer.

As much of the demand for new batteries will likely be for large cylindrical cells, Chinese battery makers who have relied on a huge domestic market where prismatic cells rule, will need to change course like EVE and CATL, Duan Bing said. , an analyst at Nomura.

Eve, founded by lithium-ion battery researcher Liu Jincheng in 2001 and also a supplier to Xpeng Inc, is a much smaller player than CATL. It ranks eighth with 2.3% market share in China, according to data from the China Automotive Battery Innovation Alliance.

In comparison, CATL manufactures 47.6% of the total batteries installed in electric vehicles in China.