At the 2024 World New Energy Vehicle Congress, BYD's chief scientist, chief automobile engineer, and president of the Automotive Engineering Research Institute, Lian Yubo, provided a "preview" of BYD's next moves in the battery sector.
According to Lian Yubo, BYD has conducted in-depth research on solid-state batteries and believes that their widespread application is still 3 to 5 years away. He emphasized, "Three years is quite difficult, but five years is more realistic."
Solid-state batteries have garnered significant attention this year, gaining widespread public recognition due to their more stable characteristics and higher energy density, making them considered the ultimate solution for energy storage in electric vehicles. Based on Lian's timeline, does this suggest that BYD will fully commercialize solid-state batteries in five years?
Solid-State Batteries: Not the End of Lithium Iron Phosphate?
In fact, discussions on the timeline for the widespread application of solid-state batteries have been ongoing. Many leading global solid-state battery R&D and manufacturing companies have made similar predictions, generally converging around the 3- to 5-year mark. This has become a common global consensus on the commercialization timeline for solid-state batteries.
At the conference, Lian also raised another important point that should attract industry attention. He believes that BYD's lithium iron phosphate (LFP) batteries will not be phased out within the next 15 to 20 years. In the future, solid-state batteries will be used in high-end models, while LFP batteries will continue to be employed in affordable vehicles.
Given the current trends in battery development, this is indeed the case. Several automakers, such as Toyota, have indicated that solid-state batteries could enter commercial production by 2027. This shows that solid-state batteries will have the conditions for commercialization, meaning that their performance and stability will have been successfully validated. However, in terms of cost, they still cannot compete with LFP and ternary lithium batteries.
The first generation of solid-state batteries is, in fact, already being used in vehicles—semi-solid-state batteries—where the anode and cathode materials are still the conventional materials used in current ternary lithium batteries, with material costs varying based on battery energy capacity. Future second and third-generation solid-state batteries may be fully solid-state, but they will still use ternary lithium materials. However, this is not considered the final form of solid-state batteries. The industry consensus for the optimal solution is that the final form of solid-state batteries will use sulfide materials for the anode. However, this would come at a very high cost.
For comparison, battery-grade lithium carbonate is currently priced at around ￥85.000. while lithium sulfide costs over $650.000 (approximately ￥4.63 million), which is 54.5 times more expensive. In terms of raw materials alone, a 1kWh LFP battery costs about ￥400 to ￥450. while a solid-state battery using sulfide materials could cost ￥21.800 to ￥24.500 per kWh, making it extremely expensive.
Thus, what Lian Yubo may be suggesting is that in the future, vehicles using solid-state batteries and those using LFP batteries will operate in entirely different segments. However, there's another issue that cannot be overlooked. In 2022. lithium carbonate prices also reached a peak, surpassing ￥600.000. But as mining expanded and demand grew, prices plummeted, stabilizing around ￥100.000 this year. So, it’s possible that significant advancements in lithium sulfide manufacturing processes and technology could lead to price reductions, breaking the barriers to the commercial use of solid-state batteries.
In other words, during the initial phase of solid-state battery commercialization, while they will offer superior performance and greatly reduce safety risks, their high costs won’t significantly compress the market space for ternary lithium and LFP batteries. However, based on Lian's 15- to 20-year projection, starting from five years after solid-state batteries truly enter commercial use, there is a great chance they could revolutionize the battery industry. In the future, affordable cars using solid-state batteries may not be too far off.
Will BYD Truly Reach High-End Status in Five Years?
BYD's push toward becoming a high-end brand has already seen significant progress, with the luxury brand Yangwang maintaining considerable popularity.
Denza's D9 has stabilized its market presence, and the newly launched Denza Z9 GT has garnered widespread praise, offering hope for upward mobility, though it still requires time for validation.
The sales of the FangChengBao brand have been relatively stable, and recent price cuts have boosted growth, but there’s still a gap between this and the true high-end market that BYD aims to capture.
While plug-in hybrid products have gained more attention this year, as the electric vehicle industry continues to develop, fully electric vehicles are expected to reclaim dominance in the new energy market. When that time comes, the push toward high-end pure electric vehicles will rely on two key technologies: autonomous driving and batteries.
Thus, it is clear that solid-state batteries will play a crucial role in the future. In terms of the global solid-state battery landscape, although many Chinese battery companies and automakers have made significant breakthroughs, data shows that more than half of the core patents related to solid-state batteries are held by Japanese companies. This raises the question of whether Chinese companies will continue to maintain the global advantage they currently have with liquid batteries when it comes to solid-state batteries.
However, this doesn’t impede BYD’s path toward high-end status. The main reason is that even in the era of solid-state batteries, BYD will remain self-sufficient, with enough technical competitiveness and cost advantages. We might see BYD engage in price wars in the million-yuan luxury car sector, which could shake traditional luxury automakers.
On the other hand, from the perspective of BYD’s smart technology development, the company's focus on vehicle intelligence has been more on vehicle control and diversified driving modes, which are more fundamental at this stage. Even with leading autonomous driving technology, it cannot yet serve as a daily driving option for everyone, especially with many safety challenges to be addressed before we reach the era of L4 autonomous driving.
In summary, BYD’s efforts to push toward the high-end market have already earned recognition from consumers. However, the electric vehicle market has not yet fully entered the high-end phase. True high-end development may still require the support of solid-state batteries and L4-level autonomous driving. Nevertheless, BYD is already fully committed to these two areas.
