As of now, LFP (lithium iron phosphate) and NCM (nickel cobalt manganese) — in their various guises — dominate electric vehicle (EV) lithium-ion battery chemistries. This year S&P Global Mobility estimates that the two chemistries will have an over 90% share of the light vehicle EV market. However, with sales growth rates for EVs have recently stalled in major markets, attention is shifting to two emerging battery technologies — sodium-ion batteries (SIBs) and solid-state batteries (SSBs) — that may help address the affordability and performance issues that many believe are behind the slowing in EV sales. As a bonus, the two emerging alternatives also reduce vulnerabilities related to the sourcing of critical elements such as lithium, cobalt and nickel.

That efforts in this direction are stepping up was demonstrated just last month when the U.S. Department of Energy awarded $50 million to the Low-cost Earth-abundant Na-ion Storage (LENS) Consortium to further develop SIB technology. The investment aims to foster an industrial ecosystem for SIBs in the US. "The challenge ahead is improving sodium-ion energy density so that it first matches and then exceeds that of phosphate-based lithium-ion batteries while minimizing and eliminating the use of all critical elements," Venkat Srinivasan, director of the LENS consortium, said in a statement.

Another notable investment in the US recently came from California-based Natron Energy. In August, the company announced plans to build a gigafactory for SIBs in Edgecombe County, NC. According to Natron, its patented Prussian blue electrodes store and transfer sodium-ions faster, and with lower internal resistance than any other commercial battery available on the market currently. Moreover, Natron's supply chain requires zero lithium, cobalt, nickel or other difficult-to-obtain minerals.

Due to the abundance of sodium compared with lithium, SIBs present a potentially cheaper alternative to lithium-ion batteries, including LFP types. They avoid the complex supply chains required for lithium-ion mass production.

Chinese companies such as CATL and BYD are also investing into the SIB space. In November, CATL's chief scientist Wu Kai revealed the development of CATL's second-generation SIB that would be launched in 2025. The company has already implemented SIB technology in the Freevoy Super Hybrid Battery that it unveiled recently.

Recent developments suggest there is a niche within light vehicles that SIBs can cater to. SIBs are likely to compete with LFP batteries, as their energy density is approximately 160 Wh/kg, compared to around 200 Wh/kg for LFP. This lower energy density, alongside a shorter life cycle, limits SIBs primarily to low-cost, entry-level vehicles. Nonetheless, the primary advantages of SIBs lie in their material costs. According to S&P Global Mobility research, the material cost for SIBs is about 28% lower than LFP batteries. Additionally, SIB manufacturing processes are nearly identical to those of lithium-ion cells, meaning that suppliers can transition with minimal investment. Despite their promise, SIB technology is still in its infancy within the light vehicle market. While limited production began in Mainland China this year, forecasts suggest SIBs will achieve only low single-digit market penetration by 2030.

SSB moves closer to mass production

The second technology worth considering is SSBs, which fundamentally alter lithium-ion battery design by replacing liquid electrolytes with solid ones. When paired with lithium metal anodes, SSBs can achieve energy densities 50%-80% higher than traditional high-nickel lithium-ion cells, allowing for greater vehicle range. For example, Nio recently launched its ES8 with a 150-kWh semi-SSB, boasting an energy density of 360 Wh/kg and a range of 930 km on the Chinese test cycle — about 20% more than the best current lithium-ion battery. Besides Nio, several carmakers and suppliers including Honda, Stellantis, Volkswagen, GAC, Nissan,CATL, Samsung SDI, SK On, LG Energy, Factorial are pouring millions of dollars into the R&D of all-solid-state batteries.

Despite the advantages, several hurdles exist for SSB adoption. The use of lithium metal anodes, which can lead to uneven plating and dendrite formation, poses risks to battery integrity. Additionally, solid electrolytes are less conductive, potentially limiting power output, especially in colder conditions. In some cases, external heating is necessary, particularly with polymer electrolytes.

S&P Global Mobility estimates that by 2025, SSB costs will be around $500 per kWh — over five times the cost of lithium-ion batteries. This means that SSB packs will initially be more expensive even with higher energy density. While some research indicates potential cost advantages for SSBs, they will remain pricier than lithium-ion batteries in the short- to medium-term. S&P Global Mobility forecasts that initial SSB applications will be in premium battery-electric and hybrid vehicles, where the greater range promised by SSBs is a significant selling point. Greater China and Europe will lead SSB production, accounting for over 73% of the forecasted 2.3 million SSB vehicles by 2034, with major automotive brands like Mercedes-Benz and BMW dominating the output.

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