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The R&D partnership between Solid Power and BMW provides a glimpse into the battery industry’s future

One of the front-runners in the quest to commercialize all-solid-state lithium-ion batteries, olid Power, has recently struggled. But a new agreement with BMW could provide the boost it requires.

Solid Power’s share price followed the all-too-familiar SPAC bounce then fall after going public via SPAC in late 2021, trading for the majority of this year at a discount to its $10 launch. The stock fell further after Douglas Campbell, the company’s co-founder and CEO, revealed that he was stepping down in late November.

While the company had been able to provide sample cells to partners BMW and Ford on time, Campbell claimed that it was having problems filling its facilities with skilled workers and sourcing premium ingredients to create its batteries.

Prior to the bankruptcy of battery industry pioneer A123 Systems, Solid Power was established in 2011. The founders were obviously affected by the bankruptcy of the larger corporation. Solid Power has always tried to provide larger businesses with battery materials that would enable denser, lighter cells rather than attempting to compete with established battery producers like LG, CATL, and SK Innovation.

Solid Power still needs to demonstrate that its materials can be mass produced in order to land those significant, long-term contracts. A breakthrough cell can be created by hand in a lab, but producing hundreds or thousands of them quickly is another matter.

Progress has been made by Solid Power, which in June unveiled a pilot production line that later produced the cells for Ford and BMW. However, it appears that line ran into some problems because manufacturing hasn’t been moving forward as swiftly as the corporation would want. It still has a sizable amount of cash on hand—over $370 million in cash and securities, according to filings with the U.S. Securities and Exchange Commission—but it needs industrial competence to get over the obstacles it has faced.

Step forward BMW: The two businesses today announced an enlarged collaborative development deal, under which BMW will pay Solid Power $20 million in exchange for the latter’s manufacturing expertise. In addition to replicating Solid Power’s pilot production line in Germany, BMW will also deploy manufacturing and battery experts to Colorado to assist with the original pilot line’s troubleshooting.

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