Battery startup Boston Power pulled up stakes and moved to China last year and so far, it appears the move has gone well.
The company today announced that Beijing Electric Vehicle Company, a division of Beijing Automotive Industry Company, will use Boston Power’s lithium ion batteries in its C70 sedan. Initially, the company intends to make hundreds of EVs, which are based on the Saab 9-5 chassis, and then make thousands in 2014, according to Boston Power founder and international chairman Christina Lampe-Onnerud.
Although it’s not very high volume, the deal gives Boston Power a paying customer and the potential to scale up to more production. The company is building a factory outside Shanghai which next year will be capable of making 15,000 battery packs per year. It also has a research and development facility nearby.
Boston Power’s move to China last year is one of the most dramatic examples of how energy companies incubated in the United States are migrating east to commercialize their technology. (See, Why Boston Power Went to China) The seven-year-old company was lured by Chinese investors and government incentives to locate in China. It had planned to make an EV battery factory in Massachusetts but ultimately wasn’t chosen as a grant recipient.
Perhaps more than money, though, Boston Power was lured by the certainty of Chinese policy. In the United States, efforts to establish clean technology industries “became political but not policy,” says Lampe-Onnerud.
“It’s really simple. It’s policy. When you issue a new seven-year plan that says that electric vehicles will be dominant in five years, that will attract all the entrepreneurs,” she says.
China, of course, is also a huge potential market which is why many other energy startups are trying to establish a presence in China. (See, Why Energy Startups Need a China Strategy). Although Boston Power has chosen to focus on electric vehicles, it first made replacement batteries for laptops, which helped harden its technology and establish its credibility.
The car itself is designed primarily as a city car with a projected range of 130 kilometers, or 80 miles, at speeds of 60 kilometers an hour, or 37 miles per hour. Beijing Automotive could use the battery pack in other models as well.
Boston Power says the 30 kilowatt-hour battery pack can operate in temperatures as low as negative 40 degrees Celsius and Lampe-Onnerud reports there have not been safety issues stemming from its batteries. Engineers were able to take cost out of the system by not including any active air or water cooling system, she added.
Once Boston Power begins shipping packs from its factory at scale, she says the company will be profitable. For her part, Lampe-Onnerud is considering what comes after Boston Power, as her contract with the company ends in September.