BMW Electric Vehicle Cylindrical Battery Sparks Competition Among Korea, China, and Japan

Envision BMW to Supply Cylindrical Batteries to US South Carolina Plant
BMW to Build Two More Plants in North America, One Using Cylindrical Batteries

[Asia Economy Senior Reporter Cho Young-shin] Chinese battery company Envision Group is producing electric vehicle batteries in the United States together with the German BMW Group.

Photo by Pengpai Capture

According to Chinese media Pengpai and Eastmoney, Envision Group is building a battery factory in South Carolina, USA, with an annual capacity of 30 gigawatt-hours (GWh). This factory is scheduled to start producing electric vehicle batteries and supply them to BMW from 2026.

Regarding this, BMW stated that it plans to receive electric vehicle batteries from Envision AESC, a subsidiary of Envision Group, locally in the US and apply them to next-generation models, investing $1.7 billion in the US. BMW added that $1 billion will be invested in the electric vehicle factory and $700 million in the battery factory.

This investment by BMW Group in the US is a strategic measure to respond to the Inflation Reduction Act (IRA).

Chinese media reported that Envision AESC’s South Carolina factory will produce cylindrical lithium batteries, emphasizing the significance of cylindrical batteries.

Pengpai highlighted that lithium-ion cylindrical batteries have over 20% higher cell energy density compared to 5th-generation prismatic batteries, resulting in approximately 30% faster charging speeds. They explained that while the nickel content is high, the cobalt content is low. Additionally, lithium recycling is possible, and compared to prismatic batteries, carbon dioxide emissions can be reduced by up to 60%.

Currently, more than 63% of electric vehicle batteries supplied are prismatic. Cylindrical batteries hold about a 15% market share. Cylindrical batteries have the advantage of mass production compared to prismatic batteries, which can lower production costs. The cylindrical battery specifications produced at Envision AESC’s South Carolina factory are 46 mm in diameter and 80 mm in length.

Pengpai reported that BMW Group is looking for two additional partners to supply electric vehicle batteries in the North American region, and one of these partners will be a company capable of producing cylindrical batteries.

Among global companies with cylindrical battery production technology, excluding Chinese companies, South Korea’s LG Energy Solution and Japan’s Panasonic are considered notable.

Chinese media emphasized the cooperative relationship between German and Chinese companies in the electric vehicle sector, noting that BMW Group previously signed battery supply contracts with Chinese battery companies CATL and Yiwei Lithium Energy. This implies that one of the BMW US factories using cylindrical batteries should be selected from a Chinese company.

Chinese media also added that BMW Group plans to build six electric vehicle factories worldwide and aims to supply 2 million electric vehicles by 2025.