Quantumscape Corp (QS): Solid-State Lithium-Metal Battery Technology

Quantumscape Corp. (NYSE:QS) made its public debut on the New York Stock Exchange (NYSE) last year in November, but the history of the company goes back a long way. Stanford University scientist and the company’s current CEO Jagdeep Singh founded Quantumscape in 2010 along with fellow scientists Fritz Prinz and Tim Holme with the sole motive of producing solid-state batteries for electric vehicles (EVs) and other industries.

The San Jose, CA-based company plans to revolutionize the EV market through its solid-state lithium-metal battery technology, which has a lot of advantages when compared to the existing lithium-ion batteries. However, it still has to go a long way before it can commercially produce those batteries, as it is still in the testing phase and could potentially face hurdles while moving forward.

Solid-state batteries are nonflammable, more reliable, can be quickly charged, and hold more energy per unit volume, which means more power can be stored in a given space. So, we can certainly say that the technology could change the EV market forever if the company successfully manages to achieve the desired results in road testing.

On the one hand, some industry experts have been questioning whether Quantumscape would ever be able to successfully commercialize the technology. But at the same time, it has been backed by some of the big names including German automaker Volkswagen and Bill Gates’ investment fund Breaking Energy Ventures.

Volkswagen has been making small investments in Quantumscape since 2012. However, it announced the first big investment worth $100 million in late 2018, with a plan to establish a mutual production setup. Last summer, the automaker made another hefty investment of $200 million.

Separately, Breakthrough Energy Ventures, led by Bill Gates, disclosed its investment in Quantumscape a couple of years ago. The fund is dedicated to spending on scientifically sound technologies, which have the potential to reduce greenhouse-gas emissions.

Hence, we can say that there is a lot of potential in Quantumscape’s solid-state battery technology, which has drawn significant interest from investors. However, investors still have to wait for at least 3 to 4 years before the company could start generating any revenue. So far, it hasn’t hit any impressive milestone, except for securing over 200 patents related to solid-state battery technology.

Meanwhile, senior officials at QuantumScape and Volkswagen expect to have a solid-state battery production facility up and running by 2025.

CEO Jagdeep Singh last month announced performance data for QuantumScape’s solid-state battery. Singh said the battery addressed all the fundamental issues that were previously holding back the adoption of the technology. The data showed that the battery takes just 15 minutes to charge up to 80 percent capacity. The conventional batteries take much longer to charge to that capacity. Moreover, the company said that its batteries should last for at least 12 years in normal use, besides enabling EVs to travel 80 percent further than existing EVs with traditional batteries.

Singh said in a statement, “Today’s batteries are not competitive. They don’t have the energy density to get the range that’s needed. They don’t have the power to get the fast charge.” He added that, “Today’s best batteries take about an hour to charge where it’s obviously easy to re-fuel a gas car in 5 or 10 minutes.”

Nevertheless, QuantumScape is not the only player looking to come up with enhanced battery technology. The impressive performance data released by the company last month will certainly attract more players towards the technology. Besides, it will face fierce competition from established battery manufacturers including Panasonic, LG, and Samsung, among others.

QuantumScape (QS) shares started trading on NYSE in November 2020 after its successful merger with a special-purpose acquisition company (SPAC) name Kensington Capital Acquisition. The stock has been highly volatile since going public.

QS shares climbed nearly 60 percent on the very first trading day. The stock enjoyed the second biggest single-day surge on December 8 when it released positive data for its solid-state battery technology. Subsequently, the stock skyrocketed to a new high of nearly $132 on December 22.

However, QS shares have been trading lower since then. On Monday, QS stock plummeted more than 40 percent on a massive volume of nearly 84 million shares. Its share price fell from around $84 per share to about $50 per share in the last trading session for no apparent reason. Yet, the stock rebounded in the mid-day trading Tuesday. At 1:06 p.m ET, QS stock jumped 13.65 percent to $56.78 on a volume 34.8 million shares.