Recently, the battery manufacturer formed a partnership with Gotion-InoBat-Batteries to obtain a license for Gotion’s lithium iron phosphate technology. This technology will be used to produce lithium-ion cells at its new Gigafactory in Telangana.
After establishing a technology partnership with Gotion-InoBat-Batteries (GIB), Amara Raja Energy and Mobility Ltd, an Indian battery giant, plans to develop an initial lithium iron phosphate (LFP) cell manufacturing capacity of 4-6 GWh at its upcoming Gigafactory. Last week, the company based in Hyderabad revealed that it had signed an agreement with Gotion High-Tech’s subsidiary GIB EnergyX Slovakia to use Gotion’s LFP technology to produce lithium-ion cells in both cylindrical and prismatic forms.
During an investor call on Friday, Amara Raja’s management shared that their initial capacity for LFP cells is expected to be around 4-6 GWh while the details are still to be finalised. The company is also constructing a ₹9,500-crore Gigafactory in Telangana for lithium-ion cells and battery packs, aiming to expand to 16 GWh for cells and 5 GWh for battery packs over the next decade. The first phase of the factory, targeting a 2 GWh capacity, is slated to be completed by the end of the next fiscal year. Management is still finalising details on production, capital expenditure, and the timeline for LFP cell manufacturing. Initially, Amara Raja will focus its LFP cells on electric vehicles, including three-wheelers and passenger vehicles, and later on stationary applications.
Discussions with potential customers have been taking place since last year. The management commented on LFP cell customer engagements, stating that they understand the requirements but do not have a specific timeline for customer interaction yet. They believe the technology they offer is now very credible from a customer perspective and are optimistic about their prospects. Amara Raja is venturing into LFP cell manufacturing for the first time and expects that collaboration with GIB will help it gain a portfolio of LFP cells. The licensing agreement grants Amara Raja access to LFP cell technology IP, support in setting up the Gigafactory, Gotion’s global supply chain for critical battery materials, and technical support for deploying solutions.
The financial terms of the partnership with Gotion-InoBat-Batteries were not disclosed. Vikramadithya Gourineni, executive director of Amara Raja’s New Energy business, shared that it involves upfront technology fees and a royalty component, but discussing specific numbers would be inappropriate. While lithium-ion batteries featuring Nickel Manganese Cobalt (NMC) and LFP chemistries are prevalent in the electric vehicle industry, LFP batteries are globally favoured due to their thermal stability, longer lifecycle, and lower costs. Innovations are being pursued to address the lower energy density traditionally associated with LFP batteries.
Amara Raja has also developed an NMC-based 2170 cylindrical cell in collaboration with another Chinese company. The Gigafactory will initially begin commercial production with NMC cells, primarily for two-wheelers. Delli Babu, the Chief Financial Officer of Amara Raja, stated that from a chemical perspective, LFP is expected to meet about 75-80 per cent of market needs, with NMC covering a smaller segment. He noted that their capacity planning is based on this projection.
Exide Industries, a major competitor, also has a partnership with China-based SVOLT Energy Technology, which develops and manufactures lithium-ion batteries for various applications. Exide has secured rights to use and commercialize SVOLT’s technology for lithium-ion cell manufacturing.
Amara Raja is one of seven bidders for the government’s production-linked incentive (PLI) scheme for 10 GWh Advanced Chemistry Cell (ACC) Manufacturing.
