Battery cells consist of several components that work together to store and deliver energy. The anode, typically made of graphite, supplies electrons, while the cathode, composed of lithium metal oxides, accepts electrons. Between these two lies an electrolyte medium that facilitates ion transport. A separator physically separates the anode and cathode, preventing internal short circuits. Current collectors channel electrons from the electrodes to external devices. The entire assembly is housed in packaging made from aluminum or steel, which ensures safety and protects the battery from physical damage. Together, these components form the essential structure of an electric vehicle (EV) battery.
The manufacturing of batteries involves a complex global supply chain with large-scale players. This network extends from raw material extraction to the recycling of batteries. India has the potential to participate in various parts of this value chain due to global efforts to reduce reliance on China and strong local demand for EVs. However, companies must carefully assess the potential and profit pools within each segment of the chain and align these opportunities with their existing strengths. Additionally, as the industry matures, the profit pool is shifting.
The process begins with the mining of raw materials like lithium, cobalt, and nickel, followed by the physical and chemical processing needed to refine these materials into compounds suitable for cell production. These materials are then used to create electrodes, separators, electrolytes, and other necessary parts. The cell assembly is subsequently integrated into modules to form a complete battery pack, which is then sold to various end users. After the battery pack reaches the end of its life, it can be recycled to recover valuable materials.
There are currently four main types of battery technologies in use. Lead-acid batteries, which are an established technology, provide high current output, recyclability, and affordability. However, they have a lower energy density compared to other technologies. Lithium-ion batteries offer high energy density, a lightweight design, fast charging capabilities, and low self-discharge rates. These characteristics make them widely adopted and commercially viable. Sodium-ion batteries are an emerging technology that generates power through the movement of sodium ions. Despite their lower energy density and higher operating temperatures, they show promise.
Flow batteries, which store liquid electrolytes in separate tanks, are known for their long cycle life, low environmental impact, and wide temperature tolerance. Although still in the early stages of development, they do not suffer from capacity degradation. While China and the USA dominate the manufacturing of these advanced and future technologies, India is a leading producer of lead-acid batteries but has a limited presence in the next generation of EV batteries. This presents an opportunity for investment and the development of manufacturing facilities in India.
The automotive retail and dealership sector is undergoing significant changes. With increasingly informed consumers, a growing number of vehicle models, and the need for longer, more engaging test drives, dealerships play a crucial role in sales. Traditionally, India has seen a fragmented base of individual dealers for most original equipment manufacturers (OEMs). However, with the rise of digital and direct-to-consumer (D2C) models, dealerships face challenges and must adapt their business models in collaboration with OEMs. The increasing presence of new OEMs, the complexity of selling and servicing vehicles, and the advent of EVs add further layers of complexity to the dealership landscape.
In the electric three-wheeler (E3W) sector, established brands like Atul, Piaggio, and Mahindra Electric prefer exclusive dealerships. On the other hand, newer EV players like Omega Seiki, Kinetic Green, and E-Royce utilize multi-brand outlets (MBOs) and online channels alongside exclusive dealerships to expand their reach. In the electric two-wheeler (E2W) and four-wheeler (E4W) segments, established brands and newer pure-play EV manufacturers employ a combination of exclusive dealerships, online platforms, and MBOs for distribution. Notably, Tata Motors has launched EV-specific showrooms and is exploring online bookings as an alternative sales channel.
