Powering Ahead With Lithium-Ion Batteries For Material Handling and Electric Vehicles



KEY POINTS

Lithium-ion batteries (LIBs) are gaining increased importance due to higher energy efficiency, longer life span, and higher density. As a result, LIBs are finding growing applications in industrial vehicles like forklifts, lift trucks, ground support applications, electric vehicles, stationary energy storage, and consumer electronics, among others, with Electrovaya well positioned to leverage this megatrend.

Electrovaya, a research-intensive company, has over two decades of experience. Management believes it has a unique, differentiating technology that delivers greater safety and greater longevity, without compromising energy and power, than other batteries commercially available today. The company has an IP portfolio of over 100 patents.

Safety is now the key performance parameter in LIBs. For example, two major auto companies had multibillion-dollar recalls last year due to battery safety. UL safety test data shows unique safety for Electrovaya’s proprietary batteries and the pristine safety record of Daimler’s e-Smart cars with Electrovaya ceramic components. Safety in commercial vehicles is even more important, whether they are material handling vehicles operating inside buildings, or e-buses or e-trucks carrying many passengers and valuables.

The company believes their battery is a ‘million-mile’ item needed for e-vehicles that work long hours from 12-16 or even 24 hours a day. Data from Walmart and Raymond/Toyota indicate the extreme longevity of these batteries. Energy storage also requires batteries which can last over 15-20 years.

Currently, the company's primary target market is the commercial industry, with a target market size of ~two million e-lift trucks in the U.S. By 2026, Electrovaya targets a ~10% market share of the new electric forklift segment, equating to 20,000 forklift batteries and an additional 500 e-bus and e-truck batteries. The price of a lift truck battery is usually $12,000 to $35,000.

OUR INSIGHTS

The Opportunities

Electrovaya is uniquely positioned to leverage the rapid growth in lithium-ion battery demand. Management believes it has one of the best-performing commercially available batteries available on the market. However the company remains relatively undiscovered by most investors outside of Canada. Demonstrating the company’s progress and technology are its strategic relationships with major OEMs, including Raymond and Toyota. In addition, Electrovaya batteries are starting to be used by major materials-handling customers, including Walmart, Mars, Home Depot, and a large online retailer. There is also a robust opportunity to retrofit existing lithium-ion units from lead-acid batteries. The company also believes it has exceptional opportunities in buses and Class 3 trucks, and recently inked a supply agreement with Vicinity Motors. Solid-state batteries present the second stage of growth and are a sea change technology under development, with 2023 targeted for launch.

The Obstacles

The company is in the initial stages of its pivot from e-passenger cars (Daimler) to higher-value e-commercial vehicles. However, the execution risk is minimized. The company has been delivering repeat orders for multiple distribution centers at Walmart and Mars, multiple stores at Home Depot, and a large e-retailer. Over 2,000 e-forklift trucks are now operating powered by Electrovaya.

Lithium-ion batteries (LIBs) are gaining increased importance due to higher energy efficiency, longer life span, and higher density. As a result, LIBs are finding growing applications in industrial vehicles like forklifts, lift trucks, ground support applications, electric vehicles, stationary energy storage, and consumer electronics, among others, with Electrovaya well positioned to leverage this megatrend.

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