1Q 2020

Emerging Opportunities for Battery Swapping in a Fast-Changing EV Market

Initial battery-swapping efforts during the early 2010s sought to allow battery EV (BEV) owners to quickly replace batteries, offering drivers practically unlimited driving range. However, the high cost of batteries and low number of vehicles that could access swap stations contributed to market failure. Considering current efforts by automakers and ridesharing companies, the 2010 battery-swapping approach might have been the right move at the wrong time.

Renewed interest in battery swapping has coincided with dramatic decreases in battery costs per kilowatt-hour and rapid growth in the EV market. In addition, CO emissions concerns and urban air pollution have helped bring focus to EV use, specifically in urban areas. These dynamics have provided opportunities for battery-swapping niches to emerge. 

This Guidehouse Insights, Strategy Insight report gives an overview of the challenges and opportunities currently faced by organizations seeking to promote battery-swapping. It identifies market segments that offer the best prospects for fostering the nascent battery-swapping market and recommendations for decision makers. This report’s findings are especially relevant to fleet managers and utility decision makers who need to determine whether battery swapping makes sense for their organizations.
Pages 15
Tables | Charts | Figures 5
  • Why did battery swapping fail during a major push in the early 2010s?
  • Why is battery swapping not commonly available now?
  • Which vehicle segments are most suitable to foster battery swapping?
  • How will battery swapping likely affect utility load shapes?
  • In what ways can battery swapping affect utility business models, specifically in areas with time of use rates?
  • How can fleet managers leverage battery swapping to add value to their organizations?
  • Which types of organizations should consider partnerships to take advantage of battery-swapping opportunities?
  • Fleet managers
  • Utility executives
  • Automobile and bus manufacturers
  • Charging station operators
  • Two-wheel and three-wheel vehicle manufacturers
  • Investor community

Spark

Context

Recommendations

The Past Lackluster Performance of the Battery-Swapping Industry Does Not Reflect Future Opportunities

A Bad Start Is Not a Bad Ending for Battery-Swapping Technology

Second-Wave Pilots Target Light Vehicles

Light Duty EV Makers in Highly Competitive China Seek Differentiation

Other Developments Suggest More Pilots Programs to Come

The Advantages of Battery Swapping over Current Charging Technologies Are Enticing, But Its Challenges Are Significant

Battery Swapping Offers Greater Visibility into Battery Health and Life Cycle

The Technology Also Offers Expanded VGI Benefits

Battery Swapping Could Defer Transmission and Distribution Upgrades

Battery Standardization Looms as a Major Hurdle

Cost and Reliability Pose Significant Concerns

The Opportunities for Battery Swapping Are Best Where Vehicle Energy Needs Are Least

Micromobility Providers Should Consider Battery-Swap Pilot Projects with Light EVs: E-scooters, Rickshaws, and Low Speed Vehicles

Differentiation Represents an Opportunity for Highway-Capable Electrics

Charging Service Companies Need to Decide How Battery Swapping Fits into Business Models

Utilities Should Investigate Secondary Battery Markets 

  • Electric Two-Wheel Vehicle Sales by Region, World Markets: 2019-2030
  • NIO Battery-Swap Station at the 2019 Shanghai Auto Show
  • BAIC Battery-Swap Demonstration at the 2018 Guangzhou Auto Show
  • LED BEV Battery Pack Price Actual and Projections, World Markets: 2010-2030
  • Example Skateboard Designs
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