Volkswagen's PowerCo and QuantumScape face challenges in the quest to mass-produce solid-state batteries.

Solid-state battery technology is poised to revolutionize the green energy storage landscape, particularly in the electric vehicle market. In a move to advance this innovation, Volkswagen Group's battery company PowerCo and QuantumScape have entered into a groundbreaking agreement to commercialize QuantumScape's next-generation solid-state lithium-metal battery technology. Upon satisfactory technical progress and certain royalty payments, QuantumScape will grant PowerCo a non-exclusive license to mass-produce battery cells based on its technology platform and proprietary solid-state ceramic separator.

"This agreement is a major step in our long-term global scale-up strategy to bring QuantumScape's solid-state lithium-metal battery technology to market," said QuantumScape President and CEO Siva Sivaram "Combining our cutting-edge technology with PowerCo's expertise in manufacturing and industrialization, this deal establishes a blueprint for a capital-light business approach and positions us at the forefront of energy storage innovation. Working closely with PowerCo as our first customer will help us accelerate commercialization and adoption of these game-changing batteries together."

Shaking things up

PowerCo plans to manufacture up to 40 gigawatt-hours (GWh) of batteries per year with the option to expand up to 80 GWh, enough to outfit approximately one million vehicles per year with solid-state batteries and disrupt the EV space.

Solid Power

A solid-state battery (right) stores far more energy by weight and volume than regular lithium-ion cells, and QuantumScape's cells have passed a series of EV-related tests.

The agreement between the solid-state battery innovator and EV battery manufacturer supersedes an earlier joint venture between the Volkswagen Group and QuantumScape to co-manufacture batteries. Both companies believe this represents the fastest way to achieve GWh-scale production of solid-state technology to meet the growing global demand for better batteries.

Solid-state batteries have long been positioned to significantly impact conventional lithium-ion battery dominance over the EV market due to addressing some of Li-ion's most critical limitations – offering higher energy density, faster charging times, and enhanced safety.

These batteries align more broadly with environmental goals by offering a more sustainable energy storage solution with minimal risk of battery fires, a significant concern for lithium-ion batteries, and their potential for taking up less space with longer lifespans means fewer battery replacements and waste, reducing the carbon footprint of transportation overall.

The partnership aims to bring these advanced batteries to mass production, potentially scaling up to 80 GWh annually. This scaling of production capacity is crucial for widespread global EV adoption, making them more appealing to consumers due to extended driving ranges and shorter charging times.

"Electric vehicles are the future of mobility, and this agreement with QuantumScape will ensure the Volkswagen Group's global fleet has access to this groundbreaking battery technology for years to come," said Thomas Schmall, Volkswagen Group Board Member for Technology. "We are committed to driving the industry forward to ensure that our electric vehicles set the benchmark for excellence and sustainability."

Complexity and scaling

Producing at gigawatt-scale will require significant investment in advanced manufacturing technologies and infrastructure, as well as more open collaboration among industry stakeholders.

This collaboration amplifies both companies' core competencies: QuantumScape's cutting-edge technology and PowerCo's global capabilities in industrialization and manufacturing facilities. The agreement features a combined workforce initiative supporting a large, dedicated team composed of experts from both companies to help accelerate the industrialization of the technology. Together, the companies are targeting a product that will scale up for integration in a Volkswagen Group vehicle series.

The manufacturing complexity of solid-state batteries presents challenges in transitioning from laboratory-scale production to mass manufacture. Solid-state batteries rely on advanced materials like solid ceramic or glass electrolytes, which require high precision and uniformity. One of the most critical issues is preventing dendrite formation, which can cause short circuits and reduce the battery life, demanding innovative solutions in material composition and manufacturing techniques.

Scaling up production involves process modification, ensuring lab results can be reproduced in higher quantities cost-effectively, and maintaining high quality and consistency. Quality control is essential, necessitating real-time monitoring and advanced inspection techniques to meet stringent performance and safety standards.

"We want to redefine the future of battery technology, bringing the most sustainable and cutting-edge battery cells to our customers," said PowerCo CEO Frank Blome. "We have been collaborating and testing QuantumScape prototype cells for years now and we are looking forward to bringing this technology of the future into series production. QuantumScape's technology is poised to enter a pivotal stage where PowerCo's specialized expertise, resources and global factories can help facilitate the transition to industrial-scale production."