Lithium ion batteries are a key part of the current move to electrification for automakers .
With China expected to continue dominating production of lithium ion cells, the West is now hoping to win the race for a vastly improved successor.
European automakers spending billions of euros in pursuit of battery breakthroughs are increasingly focusing on solid-state cells, a technology the industry hopes will hasten EV adoption because it promises to be more powerful, safer and cheaper than the current standard.
Mercedes-Benz last week signed a deal with ProLogium to develop solid-state batteries and invest a "high double-digit million euro" sum in the Taiwanese startup.
Mercedes and Stellantis last year said they are investing in U.S.-based battery maker Factorial Energy, and BMW has thrown its weight behind Colorado-based Solid Power, which went public by merging with a special purpose acquisition company late last year.
Volkswagen was Europe's solid-state pioneer. In 2012 -- years before it admitted to rigging diesel engines to cheat on emissions tests -- VW invested in QuantumScape, a secretive Silicon Valley startup attempting to make cells promising to increase driving range by as much as 50 percent and reduce charging times to 15 minutes.
QuantumScape went public in 2020 in a SPAC deal and, in a sign of the investor frenzy that gripped the nascent sector, briefly surpassed the valuation of Ford without generating any meaningful revenue.
Batteries are the most expensive component of an EV, representing roughly 40 percent of a typical car's cost, according to Bloomberg Intelligence. It's also key to performance, so mastering the technology is crucial.