The upfront cost of LiFePO4 (lithium iron phosphate) batteries is 35% lower than ternary lithium batteries (NMC) (Ningde Times 2023 data: The cost of the LiFePO4 is $80 /kWh and the NMC costs $123 /kWh), reducing the cost of BYD models such as the Han EV by 15% (the price of the regular Han EV dropped from 219,800 yuan to 186,800 yuan). It boasts over 6,000 cycles of life at an 80% depth of discharge (DOD) (2,000 at NMC) with a mean annual discharge and charge of 300 times that can last vehicle utilization for 20 years (6.6 years at NMC) and reduce lifecycle maintenance by 62%. Following the replacement of the LiFePO4 battery with the Tesla Model 3, the battery capacity degradation promise during the 8-year / 160,000 km warranty period is ≤20% (NMC battery is ≤30%), reducing the risk of second-hand residual value loss of the owner by 40%.
In terms of safety, the LiFePO4 has a thermal runaway temperature of 270°C (150°C for NMC) and only heats up to 82°C under GB/T 31485-2015 needle test with no open flame (67% risk of NMC fire). European electric vehicle fire statistics in 2023 reveal that spontaneous combustion rates of vehicles with LiFePO4 battery models are just 0.0004 times in each 10,000 vehicles (NMC models are 0.012 times in each 10,000 vehicles). After 46 tons rolling test of heavy truck, BYD blade battery can still be charged and discharged normally, and the honeycomb structure (its strength enhanced by 60%) ensures that the battery pack’s impact resistance conforms to the ISO 19453:2020 standard, reducing the risk of short circuit after collision by 91%.
Technological progress closes the energy density gap. CatL CTP 3.0 technology increases the energy density of the LiFePO4 system to 160Wh/kg (250Wh/kg for the NMC), volume utilization rate to 72% (50% for traditional modules), and AION Y model range to 610km (520km for the original NMC version). Through the collaboration of silicon-carbon anode material (420mAh/g specific capacity, 372mAh/g for graphite) and nano-sized positive electrode (150nm particle size), the capacity retention rate of LiFePO4 battery is 80% (45% NMC) at -30°C, and charging efficiency has been increased from 55% to 88%.
As far as environmental conservation and resource utilization are concerned, lifepo4 lacks cobalt and nickel (NMC contains 20% cobalt), and the lithium consumption per kWh battery is reduced by 0.2kg (0.6kg for LiFePO4 and 0.8kg for NMC). The European Union’s New Battery Law has a required recovery rate of ≥90% by 2030, while LiFePO4 closed-loop has a 95% recovery rate (85% NMC), and Brunp’s hydrometallurgical route is able to recover 98.5% of lithium (only 85% NMC). Tesla’s Berlin plant estimates Model Y with LiFePO4 batteries will produce 4.2 tons CO₂ (7.8 tons for NMC variant) throughout its lifetime, meeting EU’s 2035 zero emissions vehicle standards.
The business decision justifies its excellence: LiFePO4’s share of global EV battery installations in 2023 has increased to 67% from 13% in 2020 based on SNE Research figures. Tesla Q1 quarterly earnings report reported that the proportion of LiFePO4 batteries in its energy storage product lineup rose from 30% to 65%, and the Shanghai Gigafactory manufactured Model 3/Y standard life version was 100% LiFePO4. China Automotive Power Battery Industry Innovation Alliance reported that in 2023, domestic electric vehicles’ LiFePO4 loading volume accounted for 78%, and its export models did not need to pay the EU battery carbon tariff (NMC battery additional 0.8 euros /kWh), and the bicycle profit increased by 5.2%.
Briefly, LiFePO4 is changing the competitive landscape of the electric vehicle industry with its low cost, high safety, long life and sustainability. Bloomberg New Energy Finance predicts that by 2030, it will have a market share of more than 82% in the global power battery market and will be the optimal answer for electric transformation.