Can Recycling/Leasing Car Batteries Finally Be Game-Changing For EVs? - Page 2
According to TrueCar.com, 2011 saw the highest percentage of American car leases in at least 15 years (nearly 24%). So with such a strong number of Americans interested in lease programs, is the EV battery lease market appealing today as well? Despite the weak economy and many people looking to save money and thus lease versus buy, residual value calculations are more complex for EVs than they are for traditional autos because there are still uncertainties related to the life of the lithium batteries and how different driving habits can influence each battery’s longevity. Volt marketing manager John Hughes notes that every deal “will be a little different,” and “depends on the equipment and how the deal is written.” So if the equipment (the battery) was taken out of the equation through a structured lease or subscription service for the battery, residual values for EVs would be easier to calculate. That means leasing batteries could theoretically work.
So where do we go from here? Tesla has forged an alliance with Umicore to recover lithium-ion and secondary raw materials from batteries. Tesla has also forged an alliance with Kinsbursky Brothers, Inc. (KBI)/Toxco to recycle up to 60% of the Tesla battery system for use in new batteries. Nissan, has put in place key relationships with Sumitomo and Renault to sell cars but lease the battery. Moving to a leased battery model in the US may help boost sales of EVs (Nissan has stated it expects to sell 50,000 second hand batteries per year in Japan alone). This further validates this type of idea has traction.
There is no guarantee that today’s lithium ion batteries will be the dominant battery source in future decades. Why? Efforts are being made everywhere from labs to start-ups to find new alternatives to lithium ion such lithium air, zinc air, fuel cells, ultracapacitors, and hybrid energy storage. Does the ever-changing iteration of electric vehicle battery technologies support and validate the need to lease car batteries as a means to substantially lower manufacturing costs? Possibly since the sticker price for many EV models has discouraged consumer buying interest.Continued on the next page