Exclusive: Envision AESC likely to be global battery supplier for Tata Group

Envision AESC, the Japan-headquartered global battery cell supplier, is the lead contender amongst a multitude of potential partners, including LG Chem, CATL and FinDreams, that the Tata Group has explored as part of its ‘Project Apollo’ over the past year.

Autocar Professional learns the new battery venture is likely to be steered by Tom Flack, the former sourcing head of Tata Motors who has been made in-charge of Tata Agratas, a specially formed battery cell manufacturing company. This project is likely to involve multi-billion dollars of investment and will be run by a separate arm, which may eventually bring private equity money to fund significant capacities.

To this effect, already the group has committed over 1.3 billion dollars in India for the cell manufacturing in India, which is likely to come up in Gujarat to cater to the needs of Tata Motors’ 10-product EV portfolio, which will be manufactured out of Sanand, Gujarat.

And in the United Kingdom, the Tata Group has already committed over 4 billion pounds of investment to set up a 40GW global battery cell gigafactory. The salt-to-software group is likely to invest over Rs 50,000 crore to Rs 70,000 crore before the end of the decade in battery manufacturing capacity.

The core of discussion with Envision AESC is around high-powered NMC cells for JLR, but the Group is also exploring solid state batteries. Sources say the discussion includes options from a licencing agreement to an equity partnership but the real structure of the association will only be known in the coming months.

As part of the study, the Tata Group has explored several chemistries -- from LFP, NMC in prismatic and cylindrical form, and solid state technologies as well, It is understood that the Group is likely to have different solutions for India to power Tata Motors’ EV ambition and a different solution for JLR, which operates in the high-performance luxury car market against German rivals and also Tesla.

While an email sent to Envision AESC did not elicit any response till the time of publishing, the one sent to Tata Motors and Tata Sons drew a no- comments-on-market-rumours response.

Envision AESC: plugged in to global automakers

Though Envision is headquartered in Japan, the company has its roots in China with its promoter, founder and executive chairman Lei Zhang being a Chinese national. The Envision AESC Group operates battery production plants in Kanagawa and Ibaraki, Japan; Kentucky, South Carolina and Tennessee in the United States; Douai, France; Extremadura, Spain; Sunderland, UK (for Nissan); and four production bases in Jiangyin, Ordos, Shiyan, and Cangzhou, China along with an R&D centre in Shanghai.

AESC's 9GWh-capacity Gigafactory, with state of the art battery technology, is part of a £1bn partnership with Nissan UK and Sunderland City Council to create an electric vehicle hub supporting next generation EV production.

In October 2022, Envision AESC had announced a new multi-year partnership with BMW Group to supply latest innovation battery cells for the global brand’s next-generation EVs. The likes of Mercedes-Benz and Groupe Renault are also some of its key customers.

The company website states that through AIoT-driven innovations in battery technology and multidisciplinary applications, Envision AESC establishes scenarios to enable EVs to participate in the renewable energy eco-system, and provides a dynamic balance to promote common development of clean energy and new energy electric vehicle industry.

The Group has even studied multiple EV segments, exploring the potential of catering to two- and three-wheelers other than the captive consumption for electric cars, SUVs and commercial vehicles. It is likely to also supply to other OEs to achieve scale for a strong business case and hence even the swappable solution as well as battery energy storage solutions have been explored.

"The company is likely to invest in different chemistries and cell formats to ensure it caters to a wider market. It is most likely planning to offer a bouquet of options to ensure the right solution for the right product and topography and weather patterns," sources told Autocar Professional.

Tata: Making the most of Group synergies

Akin to a number of global multinational corporations, Tata is attempting strong vertical integration within its Group companies,a move which will bring together the resources, expertise and technology of multiple Tata Group companies to create a comprehensive solution for the production and deployment of EVs.

This should see the likes of Tata AutoComp, Tata Technologies, Tata Consultancy Services, Tata Steel, Tata Power and Tata Chemicals amongst others play a pivotal role in helping the Group lead the EV transition in India and also be a serious player in the global automotive market with JLR in the future.

The 'One Tata' approach has been at the core of its foray in India, and the same is likely to be replicated in Europe, either in the UK or other overseas bases that it may create in the future to protect itself from global business volatility.