QuantumScape, PowerCo Team Up to Manufacture Solid-State EV Batteries for Mass Market

PowerCo, the battery division of Volkswagen Group, and QuantumScape Corp. (NYSE: QS) have inked a partnership that will see the lithium-based, solid-state batteries developed by QuantumScape mass produced by Volkswagen Group’s battery production arm. This strategic collaboration is intended to bolster EV battery safety and performance by quickly bringing to market the novel solid-state batteries.

Through this partnership, QuantumScape agreed to give PowerCo a license to manufacture EV batteries based on QuantumScape’s cutting-edge battery technology. PowerCo has been permitted to make approximately 40GWh of these battery cells each year, and the company will be at liberty to ramp up its production to twice this volume if and when the need arises. It should be noted that the agreement QuantumScape reached with PowerCo doesn’t forestall the battery developer from entering similar arrangements with other entities.

This new battery technology largely hinges on the ceramic separator, which is a game-changer due to its ability to revolutionize power delivery, battery safety and energy density. The technology is proprietary.

As a result of the agreement, Volkswagen will have an opportunity to install the novel batteries in its EVs. The impact of this step is that electric vehicles will be taken into a whole new direction, and motorists will be able to enjoy unprecedented quick charging and superior battery performance. PowerCo CEO Frank Blome expressed the company’s excitement at taking this battery to mass production so that customers can access these sustainable and superior batteries.

PowerCo hasn’t just started its collaboration with QuantumScape at this point. The two companies have worked together for several years, with PowerCo conducting tests on the different prototypes of solid-state batteries that QuantumScape has developed during the past several years. That previous work is what has made it possible for the two companies to finally put pen to paper on a deal to take the battery to production.

Through this collaboration, Volkswagen Group gets to occupy the enviable position of making EVs whose batteries are breaking new ground and addressing a number of longstanding issues that have stood in the way of electric vehicles appealing to the mass market. On its part, QuantumScape gets to leverage the expertise that PowerCo has accumulated over the years in the field of manufacturing batteries. QuantumScape will also see its go-to-market capital requirements slashed by this arrangement with PowerCo.

It now remains to be seen how other automakers will respond, once VW’s new electric vehicles equipped with these batteries start reaching customers.

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