Greentech Media

A: Each cell costs 15 percent less than NiMH and then you’re using 30 percent less cells, so from both a cell and pack perspective, the cost gets lower.

Q: Car manufacturers have said they plan to use lithium-ions for plug-in hybrids. Is this also a market you’re going after?
A: We don’t think so. We think that there’s a demarcation between HEVs and then electric vehicles and plug-in [hybrids]. In HEVs, the differentiator is miles per gallon. Nickel-zinc is half the cost of lithium and delivers 70 percent of the performance. When all that stuff gets embedded in a car, it means li-ions would have just a few miles per gallon advantage over us, but at half the cost, nickel-zinc is pretty compelling. That changes in EVs and plug-in HEVs because the differentiating factor there is range. If we can get 80 miles and li-ion can get 110, that’s a big difference. We have realistic expectations of the market in thinking that people will pay the price for lithium to get that kind of range.

Q: Doesn’t that limit the size of your market?

A: We think HEVs are going to be around for a long time because the internal combustion engine isn’t going to be going anywhere soon and li-ion packs for plug-in HEVs and EVs are going to be extremely expensive.

Q: Are you planning to target mainly the U.S. market at first?

A: I think people kind of forget the things that are going on far away. The HEV market in China is growing very, very quickly as well. In China, which traditionally has been a very cost-sensitive market, nickel-zinc has a value proposition in cars. And China is where we manufacture our cells and do produce development of the cells. That’s a very important market, so talking to some of the large Chinese manufacturers like BYD is definitely in the cards.

Q: Does having only a handful of potential customers increase your risk of not being able to get a licensee?

A: We don’t think so, because it’s a very competitive market. Folks need some kind of competitive advantage and this isn’t like microprocessors, where there’s a new one every few years. We think definitely in somebody’s competitive strategy and the market space they are going after, nickel-zinc is going to work for them. At the same time, we realize this is not for everybody. GM, for example, is hell bent on the path to lithium. They are not going to stop for everything – it’s lithium or bust.

Q: How big a part of PowerGenix’s business do you expect this automotive segment to become?

A: I think if I went to the board of directors and said, “Guys, I’m going to bet the future of the company on the auto industry,” I’d be asking you for a job. It’s a high-volume, low-profit proposition. It’s something very important that could potentially turn PowerGenix from a good to a great company, but we’re by no means basing the future of the company on getting into this industry. We sell batteries for power tools, lawn and gardens, military business and we’re soon getting into consumer rechargeables, and those [segments] provide a good foundation for the business that lets us invest in this HEV business without risking the store.