 Hey, good morning. Good afternoon and good evening. I'm Yi Chui, I'm a Storage Ex-Director and on behalf of my Co-Director, Will Chu, I would like to welcome you to the Storage Ex-Imposium again for some of you, if you are new, welcome you the first time. We are not getting close to summer and in the past one years, we have been having very, very exciting speakers, panelists. Today, there's no exception. And we are having really a world expert in industry, Frank Blom, let me invite Frank to the stage to join us to discuss, of course, very exciting topic when the EV market is expanding. The battery challenge is there, it's huge. Frank will be telling us about that, but let me introduce him a little bit. Frank has a 25 years experience in the auto industry. He's currently the head of the Battery Center Excellence of Volkswagen. Before joining Volkswagen, he served as the CEO of Mercedes-Benz Energy. And before that, he also served as the CEO of LITAC batteries. So he has quite a bit of experience in the auto industry, particularly related to batteries. He's also a board member of a quantum scale as well as battery companies, I believe many of you know. With all this background and industry, let me welcome Frank to step up to the stage to tell us about what's exciting in the EV industry. Thank you, we, it's a great pleasure and a big honor for me to present as said and introduced a long time in electric mobility for cars and trucks. My diploma 25 years ago was an inverter and electric motor for an EV. These days with LITAC batteries long time ago. And I needed long to get here, but now the EVs are coming and dominating the markets. We are selling our EVs quite good. We see a lot of interest at the customers and this is good. And the breakthrough for the EVs really were the lithium-ion batteries. When these came into the game and all the technology steps, the vehicles got more and more attractive. And there's a lot still to do and a lot of possible in the next years. And I like to talk about that a bit here. And finally also, I like to answer some of your questions whenever, whatever you wanna know, I'm happy to answer and try to give the right answer. This is the first chart. We see the whole automotive industry is getting into a big, big transformation. The transformation from today's product portfolio what was optimized over more than a hundred years now is getting into CO2 neutral mobility. And with that, our combustion engine driven vehicles will go down and the EVs will go up. So we are launching a lot of EV vehicles in the Volkswagen Group. And this is a cast, fantastic cast like the Audi e-tron GT, the Porsche Taycan, the ID bus, all IDs, like the ID3, the ID4. And we worked a lot on that. We worked a lot on technology and cost to make sure our customers will get what they want. And we see with the sales we have right now a quite good trend in the market. We were starting, especially in Europe with a share, a target of a share of EVs in 2030. Then the European unity decided to increase the shares by governmental regulations. So we have to get to 60% of EVs within the next 10 years. And this is a big deal. This is a big challenge for us. China is probably even more aggressive. And we will see how this will happen and how this will perform in the US. But all that is telling us that we are on the right track and that we are as one of the starters in the industry for mass production of electric vehicles are absolutely on the right track. The next chart shows us that we really take care of all aspects to close the loop of leads your mind batteries. We're doing battery cells ourselves soon. We have bought shares of QuantumScape eight years ago and we are strong believer in the technology. We supported a lot with money and also with competence. We have bought shares of NorseVolt. What is the European startup for battery cells? And we also invested a billion into Goshen, a Chinese battery cell company to make sure that the industry can move. And on top of that, we also invest into our own battery cell plant here in Germany next to Wolfsburg. And this cell plant will come into the game in the next four years. Battery systems we do long time in-house. We have different plants all over the world producing battery systems. The first use in our vehicles is happening. We are doing second use projects. We have different stationary storage projects with second use of batteries to perform the regenerative energy storage. And we also have a recycling plant ourselves for leads your mind batteries. It's also here in Germany under my responsibility and we developed recycling technology there. And we also use that. We almost recycle our test batteries. We are having in-house in our own recycling system to make sure that also here, the industry can move on and close the loop. The next chart shows us what we are doing for battery systems. Here you see the two Volkswagen vehicles just as an example. I'm using this and not the famous Porsche Taycan or Audi e-trons because here we have a quite modular platform for batteries in production. Here you see the scalable battery system. The skateboard we say for the electric drives, the axles and the battery in the middle as everybody almost does electric vehicle architecture. And we can scale the system up with more modules and put more energy into the battery. And with that we are at the spot for whatever the customers wanna have in range and cost. So we can make good offers. Right now we really see that the bigger batteries are selling very good. And the smaller batteries are selling also good but the customers really want to buy range. That's still an issue because of the charging infrastructure. But that will change because we also invest a lot of money into our own charging infrastructure together with our partners. For battery cells, just a few charts. And this is really the base technology and cost steps we wanna do. We wanna see in the next years. The current approach is different cells in different vehicles. The sizes are different. The electrochemistry is different. And all that is leading into a very inflexible situation. So if we sell a lot of IDs but no Taycans, we cannot put the ID batteries cells into the Taycan or the other way around. Good news is that we sell all these vehicles quite well but we wanna have more flexibility. And we also wanna have a clear technology roadmap. We are launching into the platforms. In the future, we will have one unified cell format and that will perform more than 80% of the batteries in our vehicle portfolio. And this is what you see over here. 20% will be specific like very high-end cars. The Bugatti or the Lamborghini in our portfolio also these brands are belonging to Volkswagen. We also have smaller cells into our motorcycle brand Ducati but the bigger cells and the big volume will happen. And with the big volumes, we can also use the economies of scale and get the costs down. What is important to make sure the vehicles are attractive to the customers. Getting to the cell chemistry and design roadmap, of course, you all know that the air note is mainly responsible for the charging time. The cassoed is responsible for cost and range. 50% of the battery material cost is a cassoed. So if we use the cost, the bill of the old cell, it's 40% just the cassoed, including production and everything. And the range impact is almost 100% of course with silicon in the air note, you can increase. Also the range, but the cassoed is mainly in charge of range and cost of the cell. That's why this is a very, very important topic for research and development. Cassoed typically is with nickel manganese and cobalt. We also have LFP in development. And both is a quite valid technology so far. We see that in the future, we can increase of course a range with high nickel. And the cost will also be on a high level. If we reduce nickel and go to high manganese and we are working on that with a big force, a big team right now, we can get the cost down and still have a quite good range. So for the volume segment, that is probably the most promising technology we are working on for the cassoed site right now. Of course, there's a lot to do and especially the lifetime of the product is a challenge still, but we are making good progress. And nickel is getting more and more expensive year by year. So manganese, even the advantage of manganese will be bigger in the future. This chart is showing the same effect. So getting cobalt down is very important. Cobalt is the most expensive metal in the cells. Still cobalt is not, we do not have a lot of cobalt into our batteries, but in the beginning it was one-third of each and cobalt dominated the bill of material. With more and more nickel, energy goes higher. Cells are getting more difficult in safety testing, but performance is very good with high nickel, but in the meanwhile, nickel is really expensive and getting more expensive every day. And manganese is quite a cheap alternative where we can get to good performance and probably this will have, as we believe, this will have the best cost to performance ratio for the cassoed technology in the future. Lithium iron phosphate is something we also will bring in production. It's a robust and inexpensive chemistry. It is heavy, so it has a disadvantage, but on the other side it's relatively cheap and the cycle life is much better than nickel, rich or even manganese chemistry. So especially for small cars, city cars, with a small battery where the cycle specification is high, Lithium iron phosphate is a good, good alternative. Now I'd like to get to the anode and the standard anode has graphite in it. So typically it's synthetic plus natural graphite mix and the charge impact is 100%. The range impact can be 10% because it was silicon in the anode, we can improve it. Charging is important because today our customers don't like to wait longer than like filling the car with gasoline, of course that's a big challenge, but we are trying to get as close as possible and make sure that the last big disadvantage of the EVs will go away. Talking about artificial graphite combined with silicon, we can increase the range by 10% as shown and the charging time will be on a quite good level. We already have materials in research where the charging time with silicon plus artificial graphite is down to between 12 and 15 minutes if we talk about 10 to 80% and this is quite good and this will come in production but still a lot to do to make sure that this can come with good cost and also the production processes will be stable and not too expensive. And of course it's important to not waste too much energy and production to make sure the CO2 emissions in the production chain are under control too. Getting to solid state and I really love solid state technology because it's a simpler design and this leads to higher performance and lower costs. Finally, of course in the beginning it's probably not right away the more performance and cheaper solution but the potential is absolutely there. We do have a chart we got from QuantumScape in here. We do have the cassoed as it is right now, more or less. We have a ceramic separator, what is the big secret for the technology, one of the big secrets and the lithium metal will plate directly on the copper film. That means the anode has no graphite any longer and no silicon. That is good because you don't have to process it. You don't have to pay for it. You don't waste CO2 by producing it and you don't have to invest into production equipment and this is a big, big advantage. In the ID3, the 80 kilowatt hour battery has 100 kilogram of graphite that goes away with solid state battery because there's no graphite any longer so it's a big impact for the industry whenever this is going into production. This is one chart I really love to show showing the charging time. The lower curve shows a standard battery cell today. So 80% is reached in 35 minutes in average today's vehicles like our IDs, the Teslas. If we get to the Porsche Taycan, it's already around 20 minutes, 10 to 80% and with solid state technology, with quantum scapes technology, we see already in the lab samples that 10 to 80% is possible around 12 minutes. So let's say 10 minutes is a possibility we will see and we are working together with our colleagues at Quantum Scape with a lot of pressure on that. This is on top of the cost advantages the technology advantages. One big advantage of the technology fast charging will be very beneficial for the customers and the superchargers are coming into the game. Right now we are going up to 900 volt. Our Porsche and Audi's are already in that range of technology and with that and with the current limits of 350 or 500 amps it depends on the charging station. 12 minutes is possible for 90 kilowatt hour battery. So what does that say? A simple chart for our board members. If you wanna go from San Francisco to San Diego you have to make a stop. Today it's a 25 minutes charging time. With a silicon anode you can go to 17 minutes and with solid state technology it's 12 minutes. And this is not a lot of time because the trip is a long trip but nobody wants to wait for charging really and if you can reduce that that means also that charging can happen if you don't have an own house and a garage living in one of the capitals in this world and the car is parking at the street you can just go to a charging station and then 10 minutes you are back on track. Now I'm moving to recycling just for a minute and I like to show the potential of the recycling. So let's talk about a battery 400 kilogram that's a 60 kilowatt hour battery. There's 126 kilogram of aluminum we have 71 kilogram graphite. A 41 nickel and we have 22 kilogram copper and further raw materials. These can be recycled. We are already above 80% with our equipment. It's complex, it's not for free but we will further develop also the recycling technologies to make sure that finally we can close the loop. So we see that under the circumstance that we have 100% of electric vehicles someday in the field that we do not need mines any longer to produce and dig the metals out of the earth. We strongly believe that this can close a loop and all the critical or most of the critical metals are getting back, we can get back out of recycling. So I like to come to the key takeaways of the presentation, sustainability. The closed loop process installed, this is what we within the Volkswagen Group achieved. Of course it's not on a big scale so far there's still a lot to do and we need a lot of research into that direction. Competitiveness is very important and is pushing all OEMs, all car manufacturers to make the vehicles more and more attractive to the market and to the customers. The combustion engine driven cars will get more and more complex with emissions regulations. So also here will be a lot of research but that will make the cars more expensive. Electric vehicle research will go into the other direction and sooner or later there will be the day where electric vehicles will have a better business case for the customer and the standard technology of today. Volume and timing is important whenever solid state is coming into the game. It's a game changer for a separator production. It's a game changer for a graphite in the batteries and all that has to fit together and has to follow a clear strategy. We are building with our suppliers, with our partners and also under our control we are building battery system and battery cell plants and all that has to follow a clear logic. It's very important that logistic chain is short. CO2 emissions are under control. We use as much regenerative energy as we can do to make sure that the CO2 footprint of the car is good as good as it can be. We guarantee a zero footprint for CO2 to the customer. Of course we have to buy certificates to get there but the clear goal is to really close a loop also here and last but not least, the cost is a very, very important topic. So far with electric vehicles, to earn money with electric vehicles was very different, very difficult, sorry. The difficulty is coming out of scales, economies of scales missing but also technology. There's a lot of work going on into that direction and I've talked about that. We have identified action fields like vertical integration of the material chain, 80% of the battery cell price is the material or the cost I should say not the price. And that means that if you wanna reduce the cost you have to work on castle material, on graphite, on electrolyte, on all these aspects. We did that and we still do. We have a lot of powerful partners and in the meanwhile we build up a team in my organization when I started three and a half years ago at Volkswagen. I had a team of 25 engineers and the meanwhile we have more than 700 worldwide working on battery cells and battery systems with a strong team in China with around 100 engineers. We have the biggest team in Germany with 450 engineers and chemists working on battery cells and around 150 working on battery systems and we right now are building up a team in the US with the first 10 to 15 engineers and this will grow too. And we have a lot of goals going into technology direction and I'm glad to say that most of the traditional technologies came out of Asia. There was all competence installed and also the first mass production products came out of Asia. But in the meanwhile we see a lot of competence growing in the US. The universities like Stanford are doing a very, very good job to push new technologies into research and also into startups and all that is supporting the strategy to make electric mobility better and more attractive to the customers. And this is it for the presentation. I thank you a lot for your attention and I'm glad to answer your questions. Well, thank you so much, Frank, for the very nice talk. Will and I will co-host the Q&A. Let me start from my first questions while the audience questions are flowing in. There's some already building up. Frank, the topic today is the EV, this massive market growth. I'm so glad to see Volkswagen grow from 30% to 60% of the car to be EV in 10 years, roughly. So if you estimate how much battery you will need, do you have an orders of many of how many, probably tell what is a tell what hour, must be tell what hour scale like the unit. And then how would you meet this challenge of this massive battery production needed? Yeah, so the automotive industry, if we calculate the figures, you know it's 100 million vehicles a year, new cars produced more or less of SDS. It was growing a bit, but very stable on a high level. If we say 70 to 80 kilowatt hours per vehicle, that is the figure we will see. And this is a massive growth. So what Tesla announced, three terawatt hours would be almost 40% of the market. So six, seven, eight terawatt hours would be 100. If we calculate with 70 to 80 kilowatt hours per vehicle, Tesla said that stationary storages will also be part of it. So Elon Musk said it's 50-50 share. I agreed to the figure. The stationary storage for regenerative energy will grow on the same scale. So in total, it's probably 15 to 20 terawatt hours capacity needed in the next, let's say 20 years. So would you expect this production will be shipping from the battery from Asia? What's the ratio generated in Europe versus Asia? Do you have a sense? Yeah. Yeah, I think it's already happening. So the biggest plants are growing right now in Europe. LG is building a plant in Poland already in production with almost 80 to 100 gigawatt hours. That's one big plant. The other one is in Ningde, China. That's CATL. It's also around 100 gigawatt hours. And we see other plants coming. North world will be 60. And we see that SK or SDI, Samsung are building plants in Europe to around 40 to 50 gigawatt hours. So this is the scale. Of course, you need a lot of these to get to the 15 or 20 terawatt hours. And that means, and on the battery day of Elon Musk, it was presented quite nicely. We need to change the production technology and also the design of the battery cells if we want to get there. We do it just traditionally like we do it today. It will probably be too slow and too expensive to get there. And now we have different approaches to reduce investment, make the production simpler. There's a lot of technology work going on in the world, but this industry will grow. There will be new players in the game. The traditional automotive suppliers, Bosch and Conti will not be any longer the biggest players in the market. There will be in-house production of batteries and cells at the OEMs. And yeah, the raw material suppliers will become more and more critical. Like also the castle material suppliers, the calcium nation, all that will be very, very critical for the rollout of the electric vehicles. In the U.S., we have a large plant built by SK and LG also has some capacities and is increasing these. But I really see the biggest volumes growing in China and in Europe right now. Well, thanks, Frank. Will, do you want to ask a question? Absolutely. Thank you, Ian. Thank you, Frank, for the wonderful presentation. A truly exciting times. I want to maybe piggyback off what Yi and you are discussing about this enormous capacity growth that is needed. And this, of course, comes together as the technology is also evolving very rapidly as you are noting. So inevitably, I think this means that the qualification cycle, it's going to be folded into R&D cycle very importantly. And it's my understanding that the qualification cycle in the automobile industry is what makes the product very robust. But at the same time, it is also lengthy. So how does VW navigate this need to be quick and agile in introducing new product but still have a robust qualification process? And all the while, the product is evolving on an year by year basis. It almost feel a bit more like the consumer electronics markets and more like the micro electronics market as opposed to the traditional auto market. So it'd be great for you to talk a little bit about how VW is changing in its mindset when it comes to qualification. Now, this is a good question. And I cannot tell you all the secrets. Well, I'm sorry for that. But the two things are happening right now, changing the automotive industry. One is software development is getting more and more in the focus. So sooner or later, we will have autonomous driving in the cars. And then the car will be your living room, will be your office or whatever. And we have to make the offer to the customer. We have to make sure the customer can then make a comfortable sleep, make whatever he wants to work or watch a movie or whatever. Go for shopping in the internet. This is one big, big thing. And we are working strongly on that. We increase the software forces by thousands of engineers as we speak. And we have a strong push into this technology right now. For AlizioMine technology, that needs of course, if we wanna go for a new technology like Solid State, that needs three to five years to bring it into production with all these testing, winter testing, summer testing, bench testing, homologation of the car to get the governmental regional releases and so on and so far. What we really push for is our unified cell is a standardized format. And this is already in discussion with different other OEMs. They wanna use that too and we can make a standard for the industry. That would mean that the production equipment for the battery cells can be reused, but as long as we don't touch the size of the cells, most of that can stay and can be the same and we just increase the performance by an update of the cathode of the electrochemistry or whatever else. These changes we can do much faster. If we do not have to requalify the complete production equipment, this can go into production within two years, one and a half years. We just do a winter summer testing or we do even a benchmark, a bench testing. Then we can be faster and we can roll it out into the fleet because we just qualified once and then bring it into different vehicles. And as long as the mechanical design is following the same logic and the size of the cell is the same, that is a much, much faster and easier way to bring new technology to the dealers. Thank you, Frank. Could you maybe also comment a bit on the qualification of new chemistry? Your talk was mostly about a chemistry roadmap across the board. Yeah, well, I can. A new chemistry, let's say we are changing from six to two, to eight, one, one. And we have a bit more energy in the battery. There are clear requirements for cycle testing. We have a clear requirement for Kellant and Derek lifetime testing. So this is high temperature over time with a high SOC. This is stressing the cell very much. Some of the cells are gassing and finally opening up under this test. Cycling shows us sometimes that the cells and they have to perform somewhere between 500 and 1500 cycles. It depends on the size of the battery. And that shows us that the cells are getting down to less than 80% too early. And of course, then we cannot release. But for an electrochemistry change, we do a lot of bench testing. We don't do a lot of vehicle testing. Vehicle testing is relatively easy. And we have a software, all software of the batteries has been made in-house. So if we have to adopt the data sheet of the cell to the software, we do it in a very short loop. Qualification of a new chemistry is around six to 12 months. Frank, very exciting. Thank you for sharing those details. Maybe one thing to add, well, of course we do a lot of safety testing. Safety testing is required by governments too. And these are standardized tests, but these do not need the long time. The long time is really calendaric and cycle life testing. Absolutely. Thank you. Yeah, Frank, this is very nice. So I want to get back to the compare solid state with traditional lithium ion, like with the liquid electrolyte. You have a comment of solid state. It's maybe the design is simpler. Can you maybe clarify or describe that a little bit? Certainly solid state now, the interface is solid, solid, all solid. And in the design simplification, for some of the, I think for many of us, certainly touching in the lab, my feeling it's interesting is the opposite. Solid state is actually quite complicated. So it would be great to pick your thought a little bit because you are really looking at this problem maybe more system level zooming in more and it would be great to share your thoughts a little bit more. Yeah, of course you're right. The devil is always in the details and you should ask Fritz Prinz or Jack Diebsing or Tim Holmes, they really know Stanford quite well and they know all the details. And of course I made a very simple explanation for the solid state battery. What I mean is you don't have to develop the graphite any longer, you don't have to develop the electrolyte any longer because it's not there. But of course you're right. The interfaces of the separator to the cathode and also to the anode film is a very, very tricky and complicated connection. And this is, you know, Quantum Scape is working since more than eight years on the technology and the breakthrough came, the proof of concept came this year, maybe last year. And it's not in production. Still a lot to do to develop production technology for separator. Make sure that all the other impacts the new technology makes is under control. So you are perfectly right. There's a lot to do and it is complicated. But if we assume we can bring it into production, we will have no anode coating any longer. We will have no electrolyte filling any longer. And that means the whole production equipment is simpler. The design of the cell is simpler, is less pieces in the bill of material and that all pays back into a more robust product and the product what has benefits in investment and also in the cost, the bill of material. But you are totally right. To get there is a painful long way, but it makes sense to do this and to get there. And it's not only Quantum Scape working on that. All other cell suppliers are also in the game and sooner or later we will see this in production. Thanks, Fang, Will. Frank, I know your time is limited and I apologize to the audience that we can't convey all of your questions. Maybe let me just ask one final question before we wrap up here. And Frank, this is about cathode. So I myself been working on cathode for about a decade. And one thing I have always been a bit puzzled by is the trend to go to Nickel Ridge. Yes, the energy density will be higher, especially if you define it by voltage cutoff. But inevitably there's always a trade-off in the stability of the material, especially with regards to oxygen evolution. This will report it. Nonetheless, this is the direction of the industry. I'm curious in the internal brainstorming and discussion at VWS, you choose the materials wrote for cathode. How do you weigh this energy density, this range consideration? And perhaps also the cost it would be necessary to make the battery safe. And could you speak a little bit about your thought process in the trade-off process? Yeah, thank you for the question Will. So today it doesn't matter really if you use Nickel Ridge or less Nickel because the cost of the cells are not dominated by the metal, but this will change. The metal cost will be significantly be in the bill of material of the cathode. And to go on the last whatever 2% of increase of energy will be expensive because all you explained is getting in the way. That's why we think it's probably a better solution to go to a lower energy density and try to figure out, like I explained, going into manganese-rich technologies because you will have a big impact in costs and a small impact in range. And this probably is a better business case. Today, of course, everybody wanna have as much range as possible, but this is also because the charging performance is not good. This will change and the charging infrastructure is not there, so everybody will buy range. But I don't think that's really an advantage in the future, fast charging and the developed infrastructure will change that. And then the cost of the battery the cost of the battery is probably more sensitive than ever before. And today we are also limited by a volume of the battery system in the car. We go to, and wait too, if we go to solid state, that will go away. Then the volume driven by the much better energy density talking about today's technology, we are around 650, 700 watt hours per liter. Solid state will be 900 or 1000. And then this, it's not limited any longer and you can buy a more energy probably for a good price in the same volume. And that will change the mindset and the sinking of the layout of an electric vehicle. So to summarize today, everybody likes to have as much range as possible into the car. And the battery energy is of course, a very big contributor to that, not the only one, but a very big one. And in the future, probably the cost of the battery is even more important than the last five kilowatt hours of energy. Frank, thank you. I really resonate with your cathode strategy. I think it makes a lot of sense and reflects a holistic and system level thinking as opposed to improving only one single metric. Frank, thank you. And on East behalf, thank you very much for taking the time to speak to us and our audience today. I know you have many important things such as rolling out a massive EV economy for the rest of us. So we really appreciate your hard work. And if I could have just in the closing slides, please. So we have heard from Frank today all of the difficult material science problems, especially related with the cathodes. So two weeks from now, we are very pleased to have Professor Yung Kuk Sung from Hanyang University and Professor Hubert Gasieger from the Technical University of Munich who will have a focused discussion on the next generation of chemistries for cathodes. Perhaps, Frank, you might be interested and your team might be interested to join this interesting presentation as well. Next slide, please. And just to remind everyone, if you're interested in learning more about story ejects, please come to our website, subscribe to our LinkedIn page. And then also we have a variety of professional courses for those interested in learning more broadly about energy. And again, Frank, thank you so much for spending the time with us. It was a very illuminating to learn your strategy, both in how you got here and where you're going. Thank you again and have a great afternoon, Frank. Thank you very much. It was a big pleasure and a big honor. Thank you very much. Work hard on new technology and make sure we will all get there. We will, Frank. Thank you.