Electromobility China: Are E-Scooters Paving the Way for Sodium-Ion Batteries?

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Wuxi InfiMotion Technology Co., Ltd.

It could be e-scooters that help sodium-ion batteries achieve a breakthrough. The first serially produced Vespa-like two-wheelers with this battery technology have been on the market in China since this year.

Sodium-ion batteries are one of several alternatives to lithium-ion batteries that major battery manufacturers are currently experimenting with. Although they offer several advantages over LFP batteries, which currently dominate the battery market, their commercialization has been slow so far. However, this may soon change. Since this year, a trend toward sodium-ion batteries (NIB) has emerged in China, which cannot yet be described as a "disruption" but could certainly influence the battery industry in the future.

Small Market Shares, But Potential

Several Chinese manufacturers of e-scooters, small electric cars, and storage batteries have started using sodium-ion batteries (NIB). Market shares in all these segments are still small. Nevertheless, battery manufacturers like CATL believe in the potential of NIB and are introducing more and more NIB products to the market.

The Chinese company Yadea, which sold 13 million e-scooters worldwide last year, has been marketing its first model with NIB since January. In the first three months of this year, "almost 1,000" units were sold, according to a company spokesperson in an interview with the BBC. More recent figures have not yet been published.

Despite the modest beginnings, this launch marks one of several milestones on the path to commercializing the technology in China, which have begun to accumulate this year. "There is a clear business case for sodium-ion batteries," explains Ulderico Ulissi of CATL Venture Capital. The investment arm of the battery manufacturer released a market research report on NIB in late October, providing a comprehensive overview of recent developments. The independence of this battery type from lithium—whose mining and processing are environmentally harmful, supply chains unreliable, and prices volatile—currently drives its "rapid commercialization," the authors write.

This certainly applies to China, which is pushing ahead with commercialization like no other country. CATL launched its first NIB in 2021. In 2023, the first small electric car with an NIB battery, the "Chery QQ Ice Cream," went into serial production. As in some other applications, it features a hybrid electric drive that incorporates both an NIB and a lithium-ion battery. Other electric vehicle manufacturers have also already launched initial models with NIBs. JMC released a small car with this technology in December 2023, and JAC introduced its "Huaxianzi" model around the same time.

Unlimited Availability

In April of this year, CATL launched its NIB battery "Naxtra". The company offers it as a 24-volt starter battery for commercial vehicles.

During this launch, company spokespersons also emphasized the significant advantage of NIBs: that sodium, present in sea salt, is virtually unlimited in availability, enabling the long-term offering of a cost-effective product as a substitute for relatively expensive lithium. "Thanks to the abundant sodium resources, we can significantly reduce dependency on scarce lithium," Gao Huan, Chief Technology Officer for passenger cars and commercial vehicles at CATL, highlighted at the time in an interview with the newspaper Lianhe Zaobao.

Earlier this month, South Korean battery manufacturer LG Chem and the Chinese oil and gas giant Sinopec, which has recently shown interest in renewable energies, agreed on a strategic partnership for the development of cathode and anode materials for NIB. In their press release, both companies praised the new battery technology: cheaper to produce in the long term, once scaling achieves the usual cost advantages (beneficial for storage batteries); better performance in cold temperatures (interesting for starter motors); and less flammable (relevant for e-scooters, several of which have recently "self-ignited" and caught fire on China's streets).

For Now, Only for E-Scooters and Small Vehicles

The slow adoption of the technology is partly due to its disadvantages compared to lithium batteries. NIBs have a lower energy density than lithium batteries. At the current state of technology, NIBs are only suitable for scooters, small electric cars, or storage batteries, which can be built larger and where overall weight is not an issue. Only with new technological breakthroughs, which cannot be ruled out, could they also become viable for hybrid engines and electric drives in larger passenger cars.

On the other hand, commercialization is also delayed because the price of lithium has fallen again after temporarily spiking significantly during the Covid-19 pandemic. This could happen again at any time, making NIB a very interesting addition to the portfolio of battery companies.

NIB continues to have "strong commercial potential," write CATL researchers in their report. This assessment appears credible, especially as it is supported by developments in energy storage systems, which are currently experiencing a boom due to the rapid adoption of artificial intelligence and the demand for storage capacity for renewable energy (peak shaving).

In June 2024, the "Datang-Hubei" NIB energy storage system was built and connected to the grid in Hubei Province. In May of this year, the construction of the "Baochi Energy Storage Station" in Yunnan Province was commissioned. It will have a capacity of 200 MW and integrate lithium-ion batteries and NIB.

A Nose ahead of Europe?

Nationwide, more and more energy storage systems with NIB are being planned since the Chinese government included the technology in its catalog of particularly promising future technologies. Last year alone, 27 new NIB energy storage projects with a total capacity of 180 gigawatt-hours were announced, reports Gaogong Industrial Research.

Sodium-ion batteries are also interesting for niche markets such as batteries for robots, drones, and wearables, and the first products are now gradually entering the Chinese market.

Chinese manufacturers like CATL and HiNa are not relying solely on NIBs but are also researching other "new generations" of batteries, such as solid-state batteries, while including NIBs in their product mix and further developing them. This approach is driven not only by the potentially strong market demand in the future but also by a strategic calculation. Should anyone outside China eventually come up with the idea of using NIBs to reduce dependence on Chinese lithium-ion batteries or Australian lithium mines, Chinese battery manufacturers will have already mastered, scaled, and commercialized this technology.

The global capacity of sodium-ion storage batteries is estimated to reach 500 GWh by 2033, according to a forecast by Wood Mackenzie. The report also states that approximately 90% of this capacity will likely be in China by then. For foreign competitors, it will become increasingly difficult to keep up with this level of scaling.

Conclusion: Chinese companies are currently positioning themselves strategically with significant investments in sodium-ion batteries for a potential billion-dollar market, and the necessary commercialization in large-scale production has already begun. (se)