Pair in talks to form joint venture
BMW has sent its intent to procure cylinder batteries to Samsung SDI, TheElec has learned.
The German automobile giant is requesting 21700 cylinder batteries __ which is currently used by Tesla __ from the South Korean battery company.
BMW and Samsung SDI will also co-develop next-generation batteries under the proposed partnership, people familiar with the matter said.
Once the development for the new batteries is complete, they will be manufactured at Samsung SDI’s factory in Goed, Hungary.
The pair are also reviewing the formation of a joint venture.
Samsung SDI’s investment review committee is reviewing BMW’s proposal.
The German company had reviewed multiple South Korean cylinder batter companies before making the proposal to Samsung SDI.
BMW’s proposal will be welcomed by Samsung SDI as it will give them a stable customer for cylinder batteries.
The pair’s planned next-generation battery will be larger than 21700 batteries. It will be smaller than 46800 batteries that Tesla is currently developing.
Size of the planned battery will be somewhere in between, the people said.
This is because making cylinder batteries larger increases the development difficulty substantially. The pair put production efficiency first, they said.
The larger the jelly roll within the batteries become, more rapidly the defect rate will also increase, the people said. The development of the necessary winder that winds the jellyroll, while making sure the roll is aligned properly, is extremely difficult, they said.
BMW has so far only used prismatic batteries for its electric vehicles. The company only started developing its own platform that combines EV and internal combustion engine cars last year. This platform is expected to be completed in 2025.
This is behind in schedule to other car makers. General Motors has Ultium, Hyundai Motor Company has E-GMP and Volkswagen has MEB as their EV platforms.
Using cylinder battery will allow BMW, which is late in joining this race, to be flexible to market changes.
If BMW and Samsung SDI agree on the deal, the latter will have to change its plan for its battery plant at Hungary. Samsung SDI will need to prepare a production line for cylinder batteries at its second factory there or build a new factory entirely.