Lithium battery price drop prompts Aussie electric van maker to set up in Victoria
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An Australian company will produce thousands of delivery vans and minibuses every year from a new electric vehicle factory in Victoria’s Latrobe Valley.
The Victorian government announced the plan with Melbourne-based SEA Electric on Tuesday.
SEA Electric has already developed a range of electric drivetrain models for commercial and delivery vehicle market. The company has a factory in Dandenong where it assembles electric delivery vans and mini buses.
About five years ago SEA made a decision to invest heavily in electric vehicle (or “EV”) tech so it would be ready to start production when the cost of lithium-ion batteries dropped below $US300/kwH.
“That was our milestone — it was a milestone for other big original equipment manufacturers (OEMs) as well — set by a range of analysts back in 2010,” SEA Electric boss Tony Fairweather told Stockhead.
The forecast was $US300KwH by 2025 – but it actually happened in December 2016.
“We were ready and came to market in January 2017 – we have been swimming quickly ever since,” Mr Fairweather says.
— SEA Electric (@SeaElectric) October 30, 2018
“We foresaw the accelerating transition to EV. We took a gamble that the cost of batteries was going to come down much quicker than anyone anticipated – and we were right.”
SEA Electric will be assembling its smallest vehicles at the new Latrobe factory — a commuter bus (E4B) and delivery van (E4V) – for national and nearby international markets.
“The commercial distribution and delivery vehicle market represents about new 25,000 units sold on Australia every year,” he said.
“Every single one of the products sold in that segment at the moment is a fully imported, combustion engine-based product.
“We will be supplying the only locally assembled, and 100 per cent EV product in the segment.”
The vehicles are also economically competitive and the flexible design means the system to be upgraded over time, Mr Fairweather says.
“In the commercial vehicle space, the ability to upgrade that product over time is going to be a great advantage to operators — from total cost of ownership, to resale value.”
SEA Electric currently imports many of the components – including the vehicle ‘shell’, battery packs, electric power steering, electric air conditioning, and so on – to be assembled locally.
But Mr Fairweather sees a real opportunity for local automotive parts suppliers to transition to EV components.
“While there is an opportunity to supply our company, there is a massive and expanding global market in EV,” he says.
“Victoria has an enormous opportunity to benefit from this if they get in the game early. We have more than enough smarts in Victoria to be developing those sorts of components locally.”