Boston-Power, Inc. announced today a multi-year agreement to provide battery systems to Beijing Electric Vehicle Company (BJEV), the electric vehicle delivery arm of Beijing Automotive Industry Company (BAIC).
The company stated that “it is projected that Boston-Power’s battery systems will be used in hundreds of electric vehicles (EVs) starting in 2012 and thousands of EVs by 2014.”
“China is committed to leading the world in electric vehicle innovation, manufacturing, public policy, consumer adoption and export,” said Boston-Power Chairman Sonny Wu. “Boston-Power’s award-winning battery systems can play a significant role in helping to accomplish those goals. We’re pleased to team with Beijing Electric Vehicle Company and Beijing Automotive Industry Company to bring world-class EVs to the market.”
Under terms of the agreement, Boston-Power’s battery systems are expected to support multiple BJEV models and brands. Availability of pre-ordered vehicles begins in fourth calendar quarter 2012 with the C70 sedan, which is based on the 9-5 SAAB chassis BAIC acquired in 2009.
According to Pike Research, a part of Navigant’s Energy Practice, the market for Li-ion batteries for transportation will grow from $2 billion annually in 2011 to more than $14.6 billion by 2017. Gas prices, increased oil dependence, and a growing desire for zero-emission vehicles are driving consumer change and buying behaviors.
The research firm points to China and the U.S. as the two markets currently best positioned to enjoy the strongest growth rates for EV adoption.
In September 2011, Boston-Power announced $125 million in funding from a combination of private equity investment and support from China. The growth capital and Chinese government incentives are being used to scale manufacturing, research and development, and business development activities in China. The private equity round was led by GSR Ventures, a venture capital firm with over $1 billion under management that invests primarily in early stage and growth stage technology companies with substantial operations in China.
Additionally, through its stimulus programs and local industrial policies, the Chinese government is providing a range of grants, low-interest loans and related financial and tax incentives.
As part of its plans, Boston-Power is establishing a R&D and EV battery engineering facility in China. This organization is building upon the current generation of Boston-Power’s lithium-ion battery technology to develop new energy storage products and solutions.
The company is also building a state-of-the-art manufacturing facility in China that will be capable of producing 400 megawatt hours (MWh) of lithium-ion battery cells annually by the end of 2012.