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Automotive Battery and EV Stocks Snapshot (TSXV: $NBM.V) (OTC: $NBMFF) (NYSE: $NIO) (NASDAQ: $TSLA) (NYSE: $F) (OTCQB: $VWAGY)

As Auto Industry Faces Chip Shortages- Battery Innovation is on the Rise to meet Next Demand Urgency

 

Point Roberts, WA and Delta, BC - September 1, 2021 (Investorideas.com Newswire) Investorideas.com, a leading investor news resource covering electric vehicle and battery stocks releases a special report featuring NEO Battery Materials Ltd. (TSXV: NBM) (OTC: NBMFF), a Vancouver-based resource company focused on battery metals and materials. The continuing panic surrounding semiconductor shortages for automakers will be followed by an urgent demand for battery innovation and supply. This is the next critical issue facing the industry in the future say experts.

Forbes recently quoted the Center for Automotive Research (CAR report) noting "With the U.S. plan to expand electromobility on a very large scale, the European CO2 (carbon dioxide) regulations and the transition to electric cars in China, the demand for electric cars and thus lithium-ion batteries is increasing significantly,"

"As manufacturers scramble to fulfill their ambitious electric car plans there's a danger of creating an artificial shortage, and of bidding prices too high. VW and Tesla are ahead in the race to make sure crucial supplies are available, while BMW and Mercedes' parent Daimler are in danger of lagging, according to the report."

Already rising to the occasion, NEO Battery Materials Ltd. (TSXV: NBM) (OTC: NBMFF) recently announced that the Company has upscaled the capacity of production from the pilot plant to a semi-commercial scale facility for silicon anode materials manufactured through NEO's proprietary nanocoating process.

From the news: NEO's semi-commercial plant project is now finalized to produce 120 tons per year, and this is a 12-fold increase from the original capacity (~10 tons per year). Assuming a ratio of 9:1 for graphite to silicon in the anode (a 10% silicon loading), 120 tons per year produced by NEO's semi-commercial plant is sufficient to supply 40,000 electric vehicles (EVs). The Company is currently in the effort of increasing the silicon content in the anode component by over a 20% loading as a short-term project through controlling volume expansion and solid-electrolyte interphase (SEI) growth. This direction implies that NEO is approaching a 100% silicon anode as the final goal.

From the news: NEO has proceeded with this decision to rapidly respond to the demands and requirements of different customers within the lithium-ion battery supply chain for electric vehicles. The ability to upscale the plant size positively indicates the mass production viability of NEO's silicon anodes. After construction and once processes are optimized, the semi-commercial plant will be able to be readily converted into a commercial-scale facility without substantial modifications.

From the news: Mr. Spencer Huh, President and CEO of NEO, commented, "All of the progress are exceeding our expectations and predicted timeline as our team is diligently accelerating our commercialization process. Based on internal sample testing results and the optimization of our manufacturing process, we have validated the ability to upscale from a pilot to a semi-commercial scale facility. Between all management, advisors, and engineers, there is unanimous agreement and great confidence for the mass adoption of NEO's silicon anodes by the industry. Using the prototype testing results by our NDA partners, we can optimize our processes and material design for a more robust and convincing commercial plant."

From the news: Dr. J. H. Park, Director and Chief Scientific Advisor of NEO, added, "The location of the semi-commercial facility is being narrowed down, and the area is expected to be approximately 55,000 square feet with numerous South Korean battery cell and material manufacturers in the proximity. The space of the plant site considers the installation of at least 5 mass-production lines when the semi-commercial plant is fully converted into a commercial facility. With regards to sample testing, the results and due diligence will take on average a month, but we are actively shortening the period through expanding the production capacity of our prototype anodes. We have recently ordered two additional equipment to meet continual demands from third parties."

From the news: Mr. Suk Joong Hwang, Member of the Scientific Advisory Board, has been appointed as the project manager for the semi-commercial plant project. Mr. Hwang has over 20 years of experience in process engineering in the chemical and polymer industry. He specializes in scaling up products from the lab to mass production through pilot and semi-commercial plants.

From the news: Mr. Hwang commented, "We are extremely pleased and excited to start NEO's semi-commercial plant project. From my experience with different projects, the commercialization of NEO's silicon anodes is nearby. The plant will be designed and constructed for versatility to flexibly respond to and satisfy customers' detailed needs and specifications. In addition to capacity, the semi-commercial plant will retain the identical technical precision and optimized process as a mass-production commercial facility. The PDP (Process Design Package), which will be completed with the plant's installation, will be standardized for international use, and this will enable the swift completion and success of future commercial plants in North America."

Evidencing the global growth of EV's and future battery demands, NIO Inc. (NYSE: NIO), a pioneer and a leading company in the premium smart electric vehicle market in China, delivered 7,931 vehicles in July 2021, representing a strong 124.5% year-over-year growth. As of July 31, 2021, cumulative deliveries of the ES8, ES6 and EC6 reached 125,528 vehicles.

Attesting to how the chip shortage is affecting the industry, in a recent Zacks' article, Ford Motor Company (NYSE: F) was reported to be slowing production of its hot-selling F-150 pickup truck and two other vehicles due to the ongoing global crunch in semiconductor supply.

The automaker revealed a halt in production at its Oakville Assembly Plant in Canada and Kansas City Assembly Plant in Missouri during the week of August 30. The Oakville plant builds the Ford Edge and Lincoln Nautilus crossovers. The Kansas City facility is responsible for the assembly of the F-150.

These latest production cuts are being done to divert its scarce semiconductor supply in order to finish the nearly-completed vehicles awaiting chips so that they can be dispatched to the dealers.

During Ford's annual shareholder meeting on May 13, CEO Farley said the company is weighing future strategies to deal with chip woes. Some of these strategies include redesigning car components to work with more accessible chips and cutting supply deals directly with chip foundries.

One company that seems to always be one step ahead when it comes to looking for new business vertices and innovation is Tesla. In a recent CNBC article, Tesla Inc. (NASDAQ: TSLA) has been reported to be looking to sell electricity directly to customers in Texas, according to an application filed by the company in August with the Public Utility Commission there.

The application follows the start of a big battery build-out by Tesla in Angleton, Texas (near Houston), where it aims to connect a 100 megawatt energy storage system to the grid. Texas Monthly first reported on the application, submitted by a wholly owned subsidiary of Tesla called Tesla Energy Ventures.

Tesla has also built several utility-scale energy storage systems around the world, including one east of Los Angeles, with another underway in Monterey, California, and two in Australia - one in Geelong, Victoria and another in Adelaide, South Australia.

So far Tesla hasn't functioned as the retail electricity provider but has instead focused on having big batteries built by Tesla to help other companies in energy generation, storage and consumption.

There have even been some unforeseen benefits for automakers when it comes to their outdated vehicles such as with Volkswagen. In a recent article from Fortune, Volkswagen AG (OTCQB: VWAGY), who has traditionally relied on its heavy-hitting premium brands Audi and Porsche to haul in larger profits time and again, now has competition from the unlikeliest of candidates-the group's own captive financing business, VWFS.

Thanks to a global semiconductor shortage that has depleted stocks of new vehicles and forced consumers to scour used car dealerships for a new ride, the stable but otherwise unspectacular VW subsidiary is cleaning up by selling (or leasing) pre-owned models in a superheated market.

Not all carmakers operate their own financing units: the business requires solid credit ratings in order to afford the constant trips to debt markets for fresh funding. Some have opted to partner with more traditional specialists like Santander Consumer USA, an auto loan provider belonging to the eponymous Spanish bank. But for those that do, whether BMW in Germany or Ford in the US, have enjoyed record results at these businesses, just like Volkswagen.

"We've earned more in the first half of 2021 than in the whole of 2016," said VWFS Chief Executive, Lars Henner Santelmann in a statement forecasting record profits of €4 billion ($4.7 billion) this year. If it hits that mark, such a bottom-line haul would be equivalent to more than 20% of the VW group's 2019 pre-COVID operating profit.

The Volkswagen branD, which builds models such as the Tiguan SUV and Jetta sedaN, could not match this level when it earned a record €3.8 billion in 2019 or with Porsche, the big margin generator in the VW group, which contributed only €4.2 billion in its best year.

Recent data published revealed a 25% year-on-year plunge in Germany's new car market in July. With order books still full, industry insiders said the declines suggest remaining inventories of new cars that helped buttress sales amid the chip shortage have largely been picked clean.

As we approach the event horizon of this chip shortage we can expect automakers and battery manufacturers to have all hands on deck when it comes to dealing with this global issue. With headlines like Bloomberg's "Tight Battery Market Is Next Test for EVs After Chip Crisis," it is critical for consumers and investors to pay attention.  

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