QuantumScape's Lithium Batteries Could Be a Gamechanger

QuantumScape Corp. (NYSE: QS) has released performance data regarding its next-generation solid-state lithium-metal batteries for use in electric vehicles (EVs). While EVs have been a growing trend in the market, this firm is a derivative play on this trend.

Although QuantumScape is not a household name, its technology addresses fundamental issues holding back widespread adoption of high-energy density solid-state batteries, which would ultimately play into the adoption of EVs. These issues include charge time (current density), cycle life, safety and operating temperature.

The company boasts that its solid-state battery is designed to enable up to 80% longer range compared to today’s lithium-ion batteries. Also, QuantumScape notes that previous attempts to create a solid-state separator capable of working with lithium metal at high rates of power generally required compromising other aspects of the cell (cycle life, operating temperature, safety, cathode loading or excess lithium in the anode).

As for the performance data, the solid-state separators were capable of working at very high rates of power, enabling a 15-minute charge to 80% capacity, faster than either conventional battery or alternative solid-state approaches are capable of delivering. Additionally, the data demonstrated QuantumScape battery technology is capable of lasting hundreds of thousands of miles and is designed to operate at a wide range of temperatures, including results that show operation at −30 degrees Celsius.

Management noted that the hardest part about making a working solid-state battery is the need to meet the requirements simultaneously of high-energy density, fast charge, long cycle life (greater than 800 cycles) and wide temperature-range operation. As it stands, the data suggest QuantumScape’s cells meet all these requirements, something that has never before been reported. Accordingly, management believes that if the company can get this technology into mass production, it holds the potential to transform the industry.

QuantumScape stock traded up about 19% to $52.68 on Tuesday, in a 52-week range of $24.50 to $56.78. The consensus price target is $28.00.