Electrode Production. During electrode production, variations in the composition of raw materials lead to high levels of scrap. For example, variations in the material slurry and coating die can lead to centerline deviations in electrode geometry, which necessitate scrapping the electrode. Today’s factories address the problem by increasing the tolerance ranges for electrodes, but this reduces the energy density of cells.

In the factory of the future, material-based processing uses inline process controls to allow machines to proactively respond to centerline deviations. Mixing and coating machines are equipped with material sensors that determine the composition of the active material slurry and adjust it using real-time feedback from the subsequent stations: the drying, slitting, and calendaring machines. In addition, smart parameter settings for calendaring and vacuum drying allow for self-adjustment on the basis of porosity and humidity measurements taken before and after calendaring. Because processes self-adjust, producers can tighten the tolerance range for electrodes and thereby increase energy density. Overall, smart process controls within coating and drying stations can reduce drying times by up to 40%. In addition, advanced robots support electrode production by performing loading, setup, and unloading tasks that are done manually today.



Cell Assembly. The tolerance level that can be achieved during assembly determines a cell’s energy density. Because current assembly machines typically rely on statistical machine control, they do not adjust to actual variations in part geometries. This limits machine accuracy, and, consequently, reduces energy density. In the factory of the future, smart parameter settings that enable inline measurement of part geometries can increase assembly machine accuracy, thereby improving cell capacity. The first applications have demonstrated that cell capacity can be increased by approximately 15%, compared with conventional assembly processes that require fixed parameter settings.

Today’s assembly machines can produce a specific cell type, chemistry, and design, with limited variations. Whenever a producer introduces a new product, it must make significant investments in new assembly machines, and may even need to build an entirely new factory. In the factory of the future, modular assembly machines directed by smart parameter-setting systems and supported by advanced robots can produce a wider range of cell geometries. This will allow manufacturers to make a greater variety of products on a single production line—a game-changing capability for battery production. The expanded product portfolio could include cells used for nonautomotive applications, such as storage.

In the factory of the future, manufacturers can make a greater variety of products on a single production line.

Cell Finishing. As each cell is assembled in the factory of the future, the production system generates a digital twin—a multidimensional digital representation of the cell, including data such as component specifications and in-process quality measurements. The digital twin is used in the cell-finishing step for smart inline quality control, allowing the producer to greatly reduce the number of physical checking stations. For each cell, electrolyte filling and precharging parameters are automatically adjusted on the basis of the features represented in the digital twin. For example, the filling machine can adjust its flow and pressure using the material property measurements recorded during electrode production. The improvements result in shorter filling times.

In today’s factory, engineers rely on experience, rather than physical correlations, to set formation parameters. The same experience-based parameters are used for every cell produced. However, because acceptable variations make each cell different, fixed parameters prevent producers from maximizing cell performance. In the factory of the future, producers analyze data represented in digital twins to set cell-specific parameters for the formation process, thereby adapting to variations and maximizing performance. Additionally, by applying quality measurements taken during previous steps (electrode production and cell assembly) and processes (filling), producers can reduce formation time by up to 20%.

Aging time can be reduced by up to 80% through smart inline quality control that uses product measurement data collected throughout the entire value chain. This advanced analytics capability allows producers to determine the risk of micro short circuits for each cell without the need for physical measurements. Only cells for which quality remains in doubt after the data analysis will need to go through the aging process—an approach called on-demand aging. Because most cells will skip the aging process, a producer needs significantly less warehouse space and related equipment.

Producers can continue to capture benefits from digital enhancements after a battery pack is in service. For example, they can analyze data on battery usage and cell performance generated by EVs on the road. The insights can be applied to improve battery design and manufacturing processes.

Battery Producers Must Retrofit Plants or Build New Ones

The steps to implement the factory of the future depend on whether a factory is operating or in the planning stage.

Existing Factories. Given the challenges of integrating Industry 4.0 into an existing factory, battery producers should limit the retrofitting investment for a particular machine to, at most, 10% of its original cost. A higher investment would likely require the producer to shut down production for a significant amount of time, which would be less cost-effective than building a new production line. To select and implement the right technologies, producers should take the following actions:

Assess the current state of the plant, including the maturity of digital applications, and identify the pain points in the value chain that are responsible for the highest costs.

Choose new digital solutions that can address the identified pain points.

Prioritize the identified solutions on the basis of their value: quantify the potential costs savings and other benefits that each solution could generate by addressing the pain points.

Launch pilots of the prioritized use cases and develop a detailed implementation roadmap.

Planned Factories. For plants in the planning phase, producers have more freedom to realize the full concept of a factory of the future. The following steps can be used to identify and capture the value:

Develop a value stream map, which is a bottom-up summary of processes and costs.

Ensure that the factory plans specify the required information flows among processes, as well as the sensors, machine controls, and tools necessary to apply advanced analytics.

Detail the process and material flows in the factory design, in order to provide the basis for setting machine specifications and selecting suppliers.

Create a detailed implementation roadmap that covers activities through the start of production at the factory. It is critical to provide information about the required process measurements and data flows to teams designing processes and products.

Automakers Should Seize a Landed-Cost Advantage

Automakers that currently manufacture ICE vehicles can find it difficult to transition to electric mobility. Sourcing batteries from a factory of the future can not only facilitate the transition but also help incumbent automakers effectively compete against startups that solely focus on designing and manufacturing EVs.

Today, most auto manufacturers of EVs purchase standardized battery cells from producers with factories that are designed to achieve economies of scale. However, using standardized cells constrains automakers’ designs for electrified powertrains. To continue to be competitive, auto manufacturers need batteries that are customized to the specifications of each vehicle platform. Only then can automakers achieve better vehicle performance through increased battery life and operating range, for example.

Advances in battery technology are enabling customized cell designs, and the battery factory of the future makes it economical to produce customized cells. Indeed, we expect that after 2030, the level of customization in electrified powertrains could exceed that of ICE powertrains today.

To benefit from these advances in the near term, automakers should move beyond traditional supplier relationships by forming strategic partnerships with battery producers that are taking the lead in applying cutting-edge technology. Such partnerships should give automakers deep insights into the major challenges of battery production and allow them to participate in developing innovative technological solutions. Close collaboration between automakers and battery producers will also enable the parties to quickly adjust production processes to new cell dimensions and chemistries and integrate new battery designs into vehicles.

Over the long term, it could be economical for automakers to build their own factories to produce customized battery cells for future generations of EVs. As an industry benchmark, production capacity of 10 gigawatt hours per year is considered the lower limit for achieving the scale effects required for cost-competitive production. This corresponds to approximately 150,000 EVs per year. According to recent announcements, many established automakers are targeting sales of more than 1 million EVs per year by 2030. At that sales level, the in-house production of battery cells would become feasible for these manufacturers. And given that they have decades of experience in optimizing mass production systems, many of them could optimize battery production lines at scale as well.

Indeed, for automakers in the US and Western Europe, sourcing batteries from a factory of the future (whether a supplier’s or their own) will be essential to reduce landed costs to the levels required to reach price-competitiveness with ICE vehicles well before 2030. The cost improvements will also allow these automakers to compete on landed costs with their counterparts in China and Eastern Europe. (See Exhibit 6.)