Battery swapping for electric vehicles (EVs) has a long but not particularly distinguished history. The concept was first offered by Hartford Electric Light Company, in the US, between 1920 and 1924. The company sold an electric truck without batteries and owners would purchase power from Hartford Electric in the form of an exchangeable battery. The truck owner would pay a per-mile charge and a monthly service fee. Milburn Electric operated a similar service for its cars at about the same time. But, as history demonstrates, the concept didn’t catch on and powering vehicles with hydrocarbon fuels became the overwhelmingly dominant approach.
As EVs have gained market share recently, there have been renewed attempts to adopt battery swapping techniques. But, again, not all of these have been successful. For example, US headquartered Better Place installed EV battery swapping stations between 2011 and 2013, with swaps taking five minutes, before filing for bankruptcy in May 2013. In June 2013 Tesla announced a plan to offer battery swapping, with a battery swap for the Tesla Model S taking just over 90 seconds. But by 2015 Tesla’s CEO, Elon Musk, had noted that fast-charge technology had advanced sufficiently and that “people don’t care about pack swap”, and the company’s pilot was discontinued in 2016.
But now the concept of battery swap for EVs is again gaining traction, as discussed in our recent report Automotive Batteries: An EV charging alternative worth USD3 billion in 2034.
In particular, Chinese EV manufacturer Nio has commissioned around 3,400 battery swap stations in China connecting 550 cities and is starting to deploy similar solutions in Europe. In China, the company has provided approaching 80 million swap services to date, with third-generation stations capable of swapping a Nio car battery in 2.5 minutes.
Other vendors offering drop-in battery services for EVs include CATL (in China) which has plans to deploy 10,000 battery swapping stations in the country by 2028, Aulton (again, in China) with 800 stations built and claiming 100,000 registered swappable vehicles, and Ample (in Madrid, Spain). However, much of the market traction for drop-in batteries (at least, in terms of numbers of batteries) is driven by their use for scooters and various types of micromobility.
In this blog post we discuss some of the potential benefits of battery swapping for traditional car-format EVs.
Firstly, if deployed in sufficient density, drop-in battery swap stations can make range anxiety for EV drivers a thing of the past. With battery swaps taking of the order of a few minutes, this is comparable to (or potentially even slightly faster than) refuelling with petrol (gasoline) or diesel, pumps for which generally deliver 30-34 litres per minute.
But there is a range of related benefits including the convenience of fast re-charging, implications for total battery capacity, charging efficiency, vehicle purchase costs, and vehicle weight, as discussed below.
Fast re-charging for EVs is particularly valuable for certain commercial vehicles, including taxis, delivery fleets, and shared mobility devices. In such cases, the use of electricity as a power source is often preferred for cost and convenience reasons, while a fast turnaround is also beneficial. Quickly swapping batteries can be a much more attractive option than recharging a built-in battery in place.
Drivers of EVs who live in properties that are not suited to supporting home-charging also fit into this category, since they have no option to fit EV charging into their day-to-day lives in a non-disruptive way, and so might particularly value the ability to recharge their vehicle in just a couple of minutes.
Worldwide, the average daily driving distance for passenger vehicles generally falls between 15-30 miles (25-50 kilometers). However, any vehicle OEM launching an EV with a similar range would be unlikely to enjoy much consumer demand since consumers prefer to buy EVs with batteries that can support the significantly greater distances that they might occasionally drive. Effectively, this results in EV batteries being generally significantly overprovisioned for the use that they are required to support on a day-to-day basis. With drop-in batteries available, drivers can potentially rely on smaller batteries that are cheaper, lighter, and have a lower sustainability footprint, with an option to easily upgrade to larger capacity batteries when the additional capacity is needed. Assuming that battery swapping could enable EV battery capacities to be reduced by 50% (on average), then such a reduction would clearly outweigh the additional battery capacity accounted for by stocks of batteries held in stations for swapping. As a result, the total battery capacity required to support EVs in a given market would likely fall significantly. In turn this would likely result in lower costs and a lower sustainability footprint overall.
Battery swap stations can potentially be located near to sources of renewable energy, so lowering pressure on distribution grids, both for grid connections to the charging station and to the renewable source. And there may be opportunities to recharge batteries at lower charging speeds than might be the case if an EV with a built-in battery connects to a charging station, so reducing cell wear and extending battery lifespans. In particular, there could be associated opportunities to recharge drop-in EV batteries when renewable energy is plentiful and cheap, also potentially assisting with grid stabilisation by releasing power when demand on the wider grid is high.
New EVs could potentially be supplied without a battery, so reducing the purchase (or financing) cost of new vehicles. The batteries meanwhile would be provided as-a-service, or effectively leased, as an aftermarket proposition with costs varying depending on the capacity of battery that a driver selects.
A further effect would be the impact to vehicle depreciation, since battery condition would no longer be a consideration for any potential buyer of a used EV. Since EVs would not be tied to a single, ageing, battery, it is likely that vehicle resale values would improve (so further reducing the cost of any corresponding lease for a new vehicle and total cost of ownership for any purchase).
The batteries themselves will degrade and lose capacity over time, but this could be compensated for simply by offering degraded batteries to drivers at a lower cost. At the end of their lives, it is likely that EV batteries could find a second life installed as home batteries, further stimulating the adoption of microgeneration technologies such as solar panels, and allowing homes to shift more of their grid electricity consumption to off-peak periods and further enabling gris stabilisation and the transition to renewable energy sources.
Meanwhile, centrally managed systems for battery charging should help to identify any emerging problems with individual batteries, or battery cells, and ensure that appropriate maintenance is carried out in a timely manner (or that the battery, or cell, in question is retired).
It is likely that the advent of drop-in batteries would also reduce the costs for repairing vehicles after accidents, since any damage to a battery pack would be far easier to repair.
Meanwhile, estates of EV batteries could be exactly the kind of infrastructure that many pension funds and other financial organisations like to invest in, with expectations that the invested assets will generate steady, low risk, cashflows over many years.
Colin Chapman, founder of Lotus Cars, adopted a famous philosophy of “simplify, then add lightness”. Lightness has enormous benefits in an automotive context, since ‘adding lightness’ means that a slew of other vehicle components can also be lighter (and cheaper) since they need to support less weight, and will also wear less quickly. The benefits of lightness in vehicles extend to enabling lighter and cheaper brakes and suspension, better fuel consumption (or mileage from a given battery), less tyre wear, increased performance and responsiveness, and less particulate matter pollution.
Clearly, any vehicle fitted with a lower capacity battery will enjoy many (but not all) of these benefits, compared to a built-in battery equivalent.
The concept of swappable batteries for EVs has much potential. However, there is significant market momentum behind the current approach of fitting a single built-in high-capacity battery to an EV. So how might a transition to drop-in batteries come about?
Clearly, the manufacturer-specific battery-swap stations as currently deployed by Nio may gain market traction to become a default approach and there have been reports that CATL (the world’s largest EV battery manufacturer, with a market share of about 38%) wanted to acquire a majority stake in Nio’s battery swapping business. But, realistically, it is unlikely that the entire market will align to any specific vendor’s standards.
Probably the most impactful potential development would be for a large market (such as the European Union) to standardise battery footprints and vehicle interfaces and stipulate that batteries must be swappable. We are not aware of any such initiatives, but there are ongoing initiatives to standardise and develop open-source (software) vehicle platforms, which clearly would facilitate a more seamless exchange of batteries in vehicles.
A more organic approach may develop in Asia, where often the blend of housing stock is less well suited to driveway charging than in Europe or the USA. Additionally, a range of drop-in battery schemes for scooters do seem to be gaining traction in parts of Asia, including providers such as Gogoro (with 640,000 battery swapping subscribers at the end of 2024) and Oyika. Zeway offers similar services in France. At the lower end of the market powering a full EV may simply be a matter of installing multiple scooter batteries?
However, whichever approach is adopted to bring about a hypothetical future where battery swapping for EVs is the norm will unlock significant economies of scale and operational efficiencies in many different areas, as discussed above.
