Battery swapping has seen a sudden surge of interest, especially for cars in China, some heavy vehicles, and two-wheelers throughout emerging markets. Can the theme re-accelerate EVs? This 19-page report finds many advantages, controversies over costs, and profiles leading companies.
Global EV sales rose by 24% YoY to 17.1M units in 2024, according to the most widely quoted online sources, and we have updated our forecasts for global EV sales (per page 2). EV growth has slowed down, especially ex-China, and the key reason is the high up-front cost of EVs (per page 3).
But could battery swapping re-accelerate the outlook for EVs? Battery swapping has been booming in China, which is now the bellwether for global EV markets. CATL has even said battery swap stations could energize one-third of EVs by 2030. Plans to build battery swap stations seem to be exploding.
How does battery swapping work? The concept is slightly different for 2-wheelers, for cars, and for larger commercial vehicles, as outlined on pages 4-6.
Advantages include lowering the up-front cost of the vehicle, 10x faster “charging” than fast-charging, battery management, extending the lifespan of an EV, while most interestingly, a large network of battery swap stations can perform the roles of grid-scale batteries as an ancillary benefit (see pages 7-8).
The key challenge for swappable batteries is discussed on page 9.
What do battery swap stations cost? We review the claims from Nio and other leading companies in battery swapping, evaluate the energy economics and draw comparisons with EV fast charging on pages 10-11.
There are some controversies over the swap costs reported by companies, however, which are critiqued, to build up our own numbers, on pages 12-14.
25,000 swap stations to-date, owned by over a dozen companies, are covered in our screen of leading companies in battery swapping. Key notes on each company, and booming emerging world adoption of battery-swappable electric 2-wheelers (a particularly interesting VC/PE theme?), are on pages 15-19.