Lithium-ion battery maker Boston-Power, Inc. announced last week that it will provide battery systems to a unit of Beijing Automotive Industry Co starting this year.
Boston-Power predicts its batteries will be installed in hundreds of electric vehicles (EVs) across multiple brands and models—including the C70 sedan—in 2012, and thousands of EVs by 2014.
Because of rising gas prices, increased oil dependence, and a growing desire for zero-emission vehicles, the market of electric cars is expected to expand over the next decade.
According to Pike Research, a part of Navigant’s Energy Practice, the market for Li-ion batteries for transportation will grow from $2 billion annually in 2011 to more than $14.6 billion by 2017. China and the United States will lead those markets.
“China’s stated policy is to lead the world in the development of clean transportation and we intend to produce thousands of hybrid and electric vehicles,” said Fang Qing, general manager of Beijing Electric Vehicle Company. “We are impressed with Boston-Power’s green and high performing technology.”
China is currently a world leader in instituting government policies to incentivize consumer adoption of EVs, but sales of battery-powered and plug-in hybrid electric vehicles in China only totaled 8,795 in 2011, which is still well below the government target of 500,000 cumulative sales by 2015.
The Chinese government provides a range of grants, low-interest loans and other financial and tax incentives for tech companies like Boston-Power to bring their business to China.
Last year, Boston-Power announced $125 million in funding from a combination of private equity investment and support from China.
As part of its plans, Boston-Power is establishing a world-class R&D and EV battery engineering facility in China. The company is also building a state-of-the-art manufacturing plant near Shanghai that will be capable of producing 400 megawatt hours (MWh) of lithium-ion battery cells annually by the end of 2012.