Bosch scraps plan to start battery cell production

“The Lithium Energy and Power GmbH & Co KG (LEAP) joint venture’s research and development work has been concluded,” the German company said in a press release on Wednesday.

The joint venture, which was founded in 2013 with Japan’s GS Yuasa International Ltd and Mitsubishi Corporation, was aimed at developing new solutions for lithium-ion battery technology.

The joint venture will now be dissolved, Bosch said, and all plans to set up a battery cell production will be scrapped. The three companies forming the joint venture, however, will use the knowledge acquired on the lithium-ion battery technology for future activities.

In a separate press release, Bosch announced that its R&D unit, Seeo, specializing in research activities on solid-state cell technology will also be divested.

“For Bosch, it’s important to have a technical understanding of cells. We don’t have to make them ourselves,” said company board member, Rolf Bulander.

The extensive know-how in the field of battery cells, which has been built up in recent years, will be further developed by Bosch in what it calls a center of competence. Employees affected by the measure would in the future develop battery-management systems and 48-volt battery systems, and draw up the specifications for cells.

According to Bosch’s calculations, the initial investment alone in market-relevant cell manufacturing operation would amount to around €20 billion. “This sum would allow the company to set up manufacturing capacity of approximately 200 gigawatt-hours, equivalent to a 20 percent market share, and thus a leading position in the market,” the company stressed.

Bosch, however, said that it is unclear if this risky investment would pay off for the company and, as a consequence, it has decided not to make it.

Despite the scrapped plans to set up its own in-house manufacturing of cells, the group believes it can gain leadership in the emerging mass electric mobility market starting in 2020. “We want to be the go-to partner for electric driving. We are already a leader in the powertrain field – and we will be in the future as well,” Bulander asserted.