Paper to be presented at the

35th DRUID Celebration Conference 2013, Barcelona, Spain, June 17-19

The Evolution of Electric Vehicle Lithium Battery Technology: Towards

SSI PerspectiveYuanPo Lin

National Tsing Hua UniversityInstitute of Technology Management

fran0763@yahoo.com

Yuan-Chieh ChangNational Tsing Hua University, TaiwanInstitute of Technology Managemen

yucchang@mx.nthu.edu.tw

AbstractThis study aims to analyze the development of electric vehicle batteries throughout the theoretical framework ?SectoralSystem of Innovation? with consideration three focuses: knowledge and technologies, acts and networks, andinstitutions. Patent analysis and industrial experts? interview methodologies are utilized to understand the knowledgeflow, acts as well as networks evolution, and dynamic institution change of electric vehicle batteries. Three distinctresults and insights are provided in the study: 1) Lithium battery is a key technology for electric vehicles throughoutpatent data analysis. 2) The main acts of lithium battery in a current market correspond with patent owns and patentcitations. 3) The structure hole helps understand the resource position and industrial development pattern for electricvehicle battery. The study concludes that the advance of lithium battery technology opens an opportunity window forsome new entrants, specifically the battery makers into the supply chain in the automobile industry. Finally, some energypolicy implications are offered in the study.

Jelcodes:Q43,Z0

1

The Evolution of Electric Vehicle Lithium Battery Technology:

Towards SSI Perspective

Yuan-Po Lin1, Yuan-Chieh Chang1, Ta-Lun Sung 2, Tien-Chi Lin3

Institute of Technology Management, National Tsing Hua University, Taiwan 1;

Lunghwa University of Science and Technology, Taiwan2; Graduate Institute of

Technology & Innovation Management, National Chengchi University, Taiwan 3

Abstract

This study aims to analyze the development of electric vehicle batteries

throughout the theoretical framework ╉Sectoral System of Innovation╊ with

consideration three focuses: knowledge and technologies, acts and networks, and

institutions. Patent analysis and industrial experts╆ interview methodologies are

utilized to understand the knowledge flow, acts as well as networks evolution, and

dynamic institution change of electric vehicle batteries. Three distinct results and

insights are provided in the study: 1) Lithium battery is a key technology for

electric vehicles throughout patent data analysis. 2) The main acts of lithium

battery in a current market correspond with patent owns and patent citations. 3)

The structure hole helps understand the resource position and industrial

development pattern for electric vehicle battery. The study concludes that the

advance of lithium battery technology opens an opportunity window for some

new entrants, specifically the battery makers into the supply chain in the

automobile industry. Finally, some energy policy implications are offered in the

study.

Keyword: Sectoral System of Innovation, Electric Vehicle, Lithium Battery

2

1. Introduction

Due to the formation of fossil fuel shortage and global warming influence,

new energy technologies development have been emerged, such as solar energy,

wind power, geothermal energy, biofuels development and electric cars, etc.

However, the development of electric vehicle technology is most considered as one

of importance for energy policy. Reviewing the literature of energy technology

development, these have completely view to argue that the development of energy

technology, no longer as the end-of pipe technology, can create economic effects

for clear technology and have large eco-system impact in a society.

The main elements of electric vehicle include three parts: power battery,

electric motor, battery management and control system. The most importance of

electric vehicle is generally considered as a battery due to a critical factor for

electric vehicles performance. Exploring the dynamic process of battery

technologies helps understand the progress of electric vehicle development. That is

a main reason why we chose the subject of battery technology analysis. Therefore,

this study aims to analyze the development of electric vehicle batteries throughout

the theoretical framework ╉Sectoral System of Innovation╊ with consideration

three focuses: knowledge and technologies, acts and networks, and institutions.

The current study covers patent analysis and industrial experts interview

methodologies to understand the knowledge flow, acts as well as network evolution,

and dynamic institution change of electric vehicle batteries.

In this study, the main information source comes from two: patent data and

expert interview. The patent data basis is from USPTO (United States Patent)

1976-2012, with focus on electric vehicle power battery patent retrieval and

exchange. The expert interview assists the exploration of patent data analysis and

energy policy understanding. Consequently, three distinct results and insights are

provided in the study: 1) Lithium battery is a key technology for electric vehicles

throughout patent data analysis. 2) The main acts of lithium battery in a current

market correspond with patent owns and patent citations. 3) The structure hole

helps understand the resource position and industrial development pattern for

electric vehicle battery.

This study begins with the theoretical framework with focus on sectoral

system of innovation: knowledge and technology, actors and networks, and

institutions. In section 3, research methods are conducted including patent data

analysis and industrial expert interview. Patent and interview data analysis are

elaborated in section 4. The results are discussed with existing literature in

section 5. Finally, conclusions relating to policy implications are offered in section

6.

2. Theoretical Framework

3

The Sectoral System of Innovation (SSI) framework proposed by Malerba is

tracked back from evolutionary theory and system of innovation. Sectoral System

of Innovation consists of three main elements: knowledge and technology, acts and

networks, and institutions. Those three elements have dynamic relationships and

co-evolution interactions (see in Figure 1). Specifically, as a given technological

development in a particular industry, knowledge and technology would play a

critical trigger for actors to form the networks or clusters (industrial network or

social network). Similarity, the greater actors and networks also influence the

previous element to help and diffuse the knowledge and technologies development.

Within a dynamic process, institutions as interactive catalyst role affect the

formation outcome of innovation system directly and indirectly (Hung, 2002).

Market demand is a main driving force for industrial innovations. In this study, due

to the petrochemical energy shortage and global warming issue, the market

demand of electric vehicles are considered to develop an alternative low pollution

engine power car for replacement solution. Three main elements are elaborate in

following section.

Figure 1: Theoretical Framework

2.1 Knowledge and technology

The SSI emphasizes the specific knowledge and technologies. Different

industries need different knowledge and technologies. These will influence the

organizations and other actors for learning in the innovation system. The

knowledge and technologies can be divided into instructions: the knowledge base

and learning process, and technology linkage and dynamic complementary

(Malerba, 2002 & 2005). Knowledge and technology play important role in the SSI

system. Two main sources are considered: internal R&D and external sourcing.

2.2 Actors and networks

4

In the SSI framework, a firm is considered as a basic unit of analysis and

plays in the production process. No one firm can innovate and survival without

network support (DeBrsson & Amesse, 1991). The actors of SSI include non-firm

organization such as universities, government parties, financial companies, and

local agencies. They can help accumulate knowledge and technologies to diffuse

the innovative activities in the system. In addition, non-market organizations also

play important roles to innovate. These are including professional groups, trade

associations, independent research institute and coordinating companies (Reddy,

Aram, & Lynn, 1991). Actors in the SSI are responsible for linking and building the

partnership in the system of innovation, which is called by sectoral structure

(Malerba, 2005). Malerba (2005) proposed two kinds of innovation networks

based on the diversity of actors in the system: (1) vertical integration, and (2)

collaboration research and development. Moreover, social network theory is also

regarded as an important factor to facilitate innovation system. Some relevant

concepts of social network are proposed: embeddness (Granovetti, 1985) and

structural holes (Burt, 1992).

2.3 Institutions

The third building block in the SSI framework is institutions. The sectroal

system of innovation has influenced by the impact of institutional environments,

which are laws, culture expectation, norms and conceptual systems etc. Agent╆s

cognition, actions, and interactions are shaped by the institutions (Malerba, 2005).

In Scott╆s (1995) synthesis of institutional theory, three kinds of rules have been

distinguished: regulative, normative, and cognitive. The first two is that

institutions mainly reflect the institutional perspective.

Malerba (2005) considered the dynamic process of institutions that influence

each other. In particular, the relationship between national institution and sectoral

may go from the sector to the national level. Moreover, Geels (2004) claimed an

interactive model of SSI approach, which interact among the different lever

institution, innovation system, and actors. The interactive model with innovation

system may be dual direction, not a single direction.

3. Methodology

3.1 Overview of EV-specific Battery industry

Electric vehicle composes of three main key components, namely, battery,

controller and motor. Of which, the battery is the most important one because it

accounts for more than 50% of a total cost in an electric vehicle and the advance of

5

the technology has been recognized as the most critical one to competent with a

conventional internal combustion engine (ICE) driven vehicle but the important

source of car. Thus, this study chooses the development of lithium battery

technology as the case study(Eisenhardt, 1989).

We segmented the battery technologies into three generations for EVs╆ use,

depending on chemicals, included lead-acid, nickel metal hydride and Lithium. The

first generation of battery technologies for EVs is lead-acid batteries, which is the

cheapest and mature material applied in the battery cell manufacturing. The

lead-acid batteries have widely used on the 3C products, while has vital problems

of low energy density, high pollution and short cycle life as they use for EVs.

Table 1: Types of Rechargeable Battery

Cell Type Pb NiMH Li-ion

LiMn2O4 LiNiMn02 LiFePO4

Cost 1(base) 2.4 6 6 烍10

Safety Good Good Median Poor Excellent

Pollution High Median Median Low Low

Patent protect No No No Yes Yes

Energy density (Wh/L) 100 250 285 烍500 255

Discharge efficiency

(W/kg)

300 800 400 300~400 2,000

Energy efficiency (%) 60 70 90 90 95

Cycle life 400 500 烍500 烍500 烍2,000

Recharge time (Hr) 8 4 2~4 2~4 烋2

EV Type GM EV1 GM EV1s

Prius (I/II)

BMW MiniE,

Nissan Leaf

Luxgen EV+ BYD E3 & E6

Tesla Roadster

Note: Pb: lead-acid; NiMH: Nickel metal hydride; Li-ion: Lithium

The second generation is nickel-metal hydride batteries which is one of the

most promising power sources for electric vehicles. Most of HEVs currently use

the nickel-metal hydride batteries as the resource of power, such as Toyota Prius,

due to this technology has developed in mature and reliable. But the mass

production of nickel-metal hydride batteries would make resources of nickel metal

fall short and the rare earth for hydrogen-storage alloy would fall short too. In

addition, compared with Lithium batteries, nickel-metal hydride batteries are less

energy generated and 30%-40% heavier. Lithium batteries, the third generation,

have become a new choice and conducted by many EVs, such as Tesla Roadster

and GM Chevrolet Volt.

6

The battery system is well known to be as one of the weakest points of EVs

(Affanni A. et al., 2005). Moreover, the choice of the battery system has been a

critical item. And thanks to an increasing emphasis on vehicle rang and

performance, the lithium battery could become a viable candidate. The Li-ion

battery technologies are segmented a number of types, depending on chemicals,

included LiMn2O4, LiNiMnO2 and LiFePO4. Of which LiFePO4 has the advantage

of high energy density, high discharge efficiency, high safety, long cycle life, while

disadvantage of high patent protection.

In current market, more than 90% of lithium battery pack is produced in

Asia. Japan battery makers account for 47% of the market share, such as Sanyo

and Sony; followed by the South Korea firms, such as Samsung SDI, LG Chem, by

25%, and the Chinese firms is the third one by 24%. However, the majority of

lithium battery packs are used on the 3C products.

3.2 Data collection and analysis

This study conducts mainly the quantitative research method, especially the

patent citation analysis, and is complemented by the qualitative research

methods(Patton, 1990), such as collecting secondary data, expert interviews, and

focus group meeting etc. we processed the data collection, analysis and

presentation followed by three steps. In the first step, four interviews to the EV

experts were conducted to identify the importance of the lithium-ion battery to

the development of EV industry and technology. They are from the government,

research institute, and vehicle maker in Taiwan and in charging of the key

positions in decision making for EV technology. A semi-structured interview by 30

minutes to one and fifteen minutes has been conducted for them. In the second

step, we collect the EV lithium battery patent data from the USPTO database from

1976 to 2012. After the patent data collection and analysis, two focus group

meetings have been conducted to be collected some valuable suggestions given by

them to the patent statistical data and the role of institution play on the innovation.

Five to eight battery experts who are from the research institutes or well- known

batter manufactories are invited to join the meetings.

3.3 Measurement

Patent citations have been widely used to measure the importance of certain

technologies or innovations (Fontana et al., 2008). Many indicators in patent

analysis have been used in the prior works to measure the pattern of technology,

actors or network, such as centrality, betweenness, closeness, density

etc.(Wartburg, 2005). Two measurements or index are mainly used in this study

to measure the pattern of actor-networking. One is the ╅Centrality╆, and the other

7

is ╅Network Constraint Index╆. The process of patent citation analysis is shown as

figure 2. The centrality is used to explore the absolute relationship in between the

patent assignees, such as in-degree centrality and out-degree centrality. While,

the ╅Network Constraint Index╆ is used to measure the comparative relationship

between the patent assignees. Network constraint index is draw from the Burt╆s

(1992) structure holes index: rConstairn and effective size. It is used to measure

the extent to which a network is directly or indirectly concentrated in a single

contact.

Original patent poolBackward citation Forward citation

cite cited

citation network

Index

Ǹcentrality

ǸNetwork constrain

Figure 2: Patent citation analysis process

If the network constraint index is higher, the network is closer and the

structural holes are fewer. In the other word, the smaller the value of the index of

constrain is, the more controlling ability the company possesses during its

positioning of the structure holes in the network. If the value of ╉Effective size╊ is

big, it means the amount of non-repeatable resource is big, in another words, the

accessibility of heterogeneous resources is significant.

4. Case Study: The evolution of Lithium battery technology

Based on the technological components of electric vehicle batteries, the scope

of search including following aspects: (1) battery technology related concepts and

key words; (2) electric vehicle related concepts and key words, including electric

cars, electric vehicles, electric motor, BEV, HEV, PHEV etc. This research analyzes

the data from USPTO Patent Full-Text and Image Database from 1976 to 2012.

8

Through the patent search, there are 12,599 items from lithium battery related

fields, and 7,814 items from vehicle-specific lithium battery.

4.1 Overview of patents of secondary battery for EVǯs use

From the observations of the blueprint of technological development for

secondary batteries, including lead acid battery, metal hydroxide battery, lithium

battery, it can be found that the patents of lithium battery is growing significantly

between 1990 to 2000.. (See Figure 3.) In a decade, the numbers of patents are

reached to 600 publications from 100 publications.

The data shows that with the fast growing of laptop and mobile devices from

2000, the development of lithium battery steps into a 2-times fast growing stage.

Afterward, to meet up the needs of electric vehicles, there is another obvious stage

of growth for development of lithium battery. Based on the observations for the

technological development trends of lead acid battery and metal hydroxide battery,

they show the similar path in which the number of patents grows fast when

laptop markets goes up, and it is decreasing afterward. After 2005, the number of

patents of metal hydroxide battery is quite few, and lithium battery becomes the

mainstream for electric vehicles.

NB

EV

NBEV

emerging

slowly growing

fast growing mature

Figure 3: Comparison of historical patent numbers of secondary batteries

9

4.2 Cross-nations analysis of lithium battery

12,599 patents from lithium battery filed granted in U.S. is shown as the

figure 4. U.S. is in the first place that has 6,057 related publications, followed by

Japan has 3,590 publications, and Korea has 957 publications. Germany and

Canada were granted 369 and 267 publications. Two growing countries in Asia,

Taiwan and China have 235 and 97 publications respectively. This figure

illustrates that North American countries and Asian countries have dominated

this technology field if patent is a reliable proxy for innovation.

Figure 4: Distribution of lithium battery patents by country

4.3 Analysis of lithium battery patentees

Among the patentees of lithium battery, most of the top ten are from

Japanese and Korean leading companies. Samsung from Korea is in the first place,

they have 409 publications. Followed by the Japanese company Matsushita by 318

publications; and Panasonic is the third one by 239 publications. In 2009,

Panasonic became the global leading company in lithium battery field by

acquisition of Sanyo. In the case, after acquisition, Panasonic owns 615

publications of US patents by its own. Added 251 cases from Sanyo, Panasonic

owned 763 patents, surpassing Samsung╆s. Besides, other Japanese companies,

like Hitachi, Sony, Canon and Toshiba etc., they have great performance on the

number of patents too.

Japanese and Korean companies take the lead in the lithium battery, other

established U.S. companies, like Wilson Greatbatch Ltd., General Electric, Valence

Technology, Inc. etc., their numbers of patents are from 90 to 100 publications.

Comparing with Japanese and Korean companies, most of U.S. companies, they

have less than 100 applications, and they don╆t have advantages in economies of

scale. For manufacturers of electric vehicles, in lithium battery, U.S. company,

General Motors, it owns 66 publications, Japanese company, Toyota, it has 44

patents.

10

The historical data of the top 10 patentees is shown as figure 4. Panasonic

Corp. developed and deployed its patent strategy in lithium battery from 1992, and

it reaches its peak in 2003. During the period of 2003 to 2008, its number of

patents dropped dramatically, and after 2008, they started to put efforts on patent

applications again. However, Samsung had taken the advantages to own much

more patents than Panasonic, and became the leading company in lithium battery

industry. Another company, LGC Chem, they also caught the opportunity to stand

at a superior position.

0

20

40

60

80

100

120

1977 1982 1987 1992 1997 2002 2007 2012

Time

pate

nt c

ount

Canon Kabushiki Kaisha Hitachi Kabushiki Kaisha Toshiba

LG Chem, Ltd. Panasonic Samsung

Sanyo Electric Co., Ltd. Sony Corporation Valence Technology, Inc.

Wilson Greatbatch Ltd.

Panasonic

Samsung

Figure 5: Historical data of the top 10 patentees

4.4 The evolution of actor-networking

By using three phases of actor-networking to analyze the top 100 patentees

(see figure 6), it shows that, there are numerous nodes and complicated

application relationship, and the graphic is difficult to read the messages within it.

However, it tells the evolution of correlations between key nodes in lithium battery

industry during 1976 to 2012. At the first phase炷1976-1990炸, the distribution of

key nodes focused on the right side, and transferred to middle nodes at the second

phase炷1990-2000炸. At the third phase炷2001-2012炸, the mutual relationship

between significant patentees became distributed and stronger. It will be

described in details as below.

11

Figure 6: Citation network of lithium-ion battery

In the first phase (1976-1990), there was only a few networking among the

innovative firms in the period as shown in figure 7. Some US based incumbent

12

firms such as Exxon, Union Carbide, Rayovac, GTE products and Medtronic, etc,

were located at the hubs of some networks. They are cited by others more closely;

While Japanese firms such as Sony, Sanyo were new entrants in this technology

filed. They did not have intensive interaction with others in terms of in-degree or

out-degree citation.

Figure 7: The networking of The first phase (1976-1990):

When come to the second phase(1991-2000), the networking is boosting

among these battery innovators. Many Japanese firms such as Fuji Photo, Canon

etc., started to position themselves on the critical hubs of the networks by

generating a great number of and valuable patents. Most of the US based

incumbent firms who enjoyed the advantage lost their leading positions, except

Medtronic. But some new battery innovators such as A123 system and

Hydro-Quebec were found to be important players in this period. Samsung SDI

has grown to be a strong player by its ownership of patents and the centrality of

the network. Another Japanese firm, Panasonic, shown its significant impact on

this technology field by its high in-degree and out-degree citation.

13

Figure 8: The networking of the second phase (1991-2000)

In third phase(2001-2012), the networking among companies was much

more intensive than the previous phases and more new entrants enjoyed in this

technology field as shown in the figure 9. Many firms, most of them are

Japanese firms, such as Sony, Sanyo, Panasonic, Fuji Photo and Valence Tech

continuously played their core position of hubs in the networks. Samsung SDI

has also built a deal number of connections with others and played a core

position, which is getting stronger to compete with the other incumbent

companies mentioned above. Another new players from Taiwan, ITRI and

Moltech, have been the one of the top ten patent owners by granted a number

of patents rapidly in recent decade.

14

Figure 9: The networking of the third phase (2001-2012)

According to the network graphic analysis above, two main observations are

in order. Firstly, it suggests that application shift from one industry to another

industry as the development of the lithium battery technology. Observing from

the industrial pattern of lithium battery patent data, we find out that at the first

phase the leading companies are in fossil business, like Exxon, Union carbide,

Rayovac, GTE products and Medtronic. Exxon was the biggest IPO petroleum

company in the world, it acquired and reorganized Exxon Mobile in 1999; at the

second phase, the core companies in the network are in electronic business, like

Fuji Photo Film, Sony, Panasonic, Sanyo, and Toshiba etc.烊At the third phase, to

catch the emerging market opportunity of electric vehicles, the original

manufacturers of lithium battery expanded their business to vehicle-specific

lithium battery, and Samsung SDI, Mitsubishi and Hitachi were the most

aggressive new players.

The other suggested by the figure is that the landscape of technological

dominant in lithium battery is changing. It observes that the leading status at the

national and landscape level in the lithium battery field have transferred to Asian

companies (e.g. Japan and Korea)from North American (e.g. U.S.) companies:

Showing from the previous network graphic, at the first phase, companies from

North America dominated the nodes of lithium battery network; at the second

phase, small amount of North American companies still got the core positions of

the network(not the same companies at the first phase), and Japanese companies

took the most of the core leading positions; at the third phase, North American

15

companies totally lose its advanced positions, instead, Asian companies, like

Japanese and Korean ones, they almost got the core position of network. In that

way, the national landscape of lithium battery technology has changed. Asian

companies have replaced the North American companies where they were at the

very superior position.

4.5 Analysis of structure holes

For further understanding the positioning of structure holes of

vehicle-specific lithium battery companies, network analysis of the top 62

patentees is conducted, and this research also processes the network parameter,

like centrality and structure holes. Structure holes analysis helps on examining the

mutual relationship in the network, and the smaller the value of the index of

constrain is, the more controlling ability the company possesses during its

position of the structure hole in the network. If the value of ╉Effective size╊ is big, it

means the amount of non-repeatable resource is big, in another words, the

accessibility of heterogeneous resources is significant. By using UCINET 6.0 to

compute the analysis, the result of the citation analysis of the top 62 patentees

shows as table 2. Also, the parameters of positioning in the network are also

included.

From table 2, Even though the significant positioning of Japanese and Korean

leading companies (e.g. Panasonic, Samsung SDI, Sony, and Sanyo Electric),

companies, like Fuji Photo Film, Wilson Greatbach, Canon, Hitachi, Valence

Technology, have strategic and advanced key positions in the network of

vehicle-specific lithium battery filed. It also shows that Fuji Photo Film owns little

patents, but stands at strategic important position in the network with constraint

value of 0.19, and Effective size value of 29.66. Another company, A123 Systems,

its value of constraint is only 0.25, but with a value of Effective size as15.93. For

Panasonic, its value of constraint is 0.25, and the value of Effective size is 23.94.

According to the values of the 3 companies, they have the most powerful ability in

controlling the patent information, and also, the most accessibility of resources

among heterogeneous companies.

Table: 2 Citation network of vehicle-specific lithium battery - parameters of

structural holes

16

Company Degree EffSize Constrain Company Degree EffSize Constrain1 Fuji Photo Film 36 29.66 0.19 32 Arizona State University 7 4.92 0.552 A123 Systems. 20 15.93 0.25 33 Toshiba 19 14.06 0.553 Panasonic 30 23.94 0.25 34 Nissan 7 5.02 0.564 LG Chem 18 14.03 0.29 35 Moltech 14 10.9 0.575 3M 26 19.36 0.3 36 PolyPlus Battery 11 8.41 0.576 Sony 19 14.93 0.32 37 Wilson Greatbatch 31 20.54 0.67 Valence Technology 23 17.29 0.35 38 Milwaukee Electric Tool 7 4.69 0.618 NGK Insulators 20 14.48 0.37 39 Enerdel 5 2.67 0.629 Shin-Kobe Electric Machi 14 9.91 0.37 40 Honda 5 3.13 0.62

10 Hydro-Quebec 14 10.46 0.38 41 Cymbet 9 6.63 0.6411 Sanyo 12 8.42 0.4 42 General Electric 8 5.42 0.6412 Toyota 11 8.75 0.41 43 NEC 6 4.29 0.6413 Mitsubishi Chemical 9 6.73 0.41 44 BYD 5 3.5 0.6814 Moli Energy 13 9.37 0.41 45 Eveready Battery 6 3.57 0.7215 Motorola 20 16.67 0.41 46 Merck Patent 5 2.86 0.7616 Quallion 15 11.31 0.41 47 Gillette 4 2.22 0.7617 USA/DOE 16 12.04 0.41 48 Showa Denko 4 2.47 0.7718 MIT 14 9.69 0.43 49 Canon 26 16.79 0.819 FMC Corporation 15 10.15 0.44 50 USA/Navy 3 1.75 0.8420 NanoGram 11 7.54 0.44 51 Compaq 5 3.39 0.8521 USA/Army 7 5.68 0.45 52 Nippon Chemical Industrial 1 1 122 Hitachi 23 16.88 0.47 53 Robert Bosch 2 1.17 123 Medtronic 14 9.21 0.48 54 SAFT 1 1 124 Toyota 9 6.58 0.48 55 Scimist 1 1 125 Asahi Kasei 14 10.29 0.49 56 Semiconductor Energy Labor 1 1 126 Denso 8 5.73 0.5 57 Tesla Motors 1 1 127 Samsung 11 7.52 0.5 58 Warner-Lambert 1 1 128 Sumitomo 12 8.78 0.51 59 Martin Marietta Energy Syste 8 5.17 1.0229 Bell Com.Res. 12 9.46 0.53 60 Ube Industries 4 1.92 1.1330 GM 10 7.68 0.53 61 Black & Decker 3 1.84 1.1731 Uchicago Argonne, LLC 10 6.99 0.53 62 EVONIK DEGUSSA 2 1 1.86

After removing the nodes of values of less than 10, the network graphics can

be visually reviewed. As shown in figure 10, many important players in the

relationship network can be observed. After acquiring Sanyo, Panasonic becomes

the most critical position, meaning that it has the most strong control power to

access the resource needed and contact with other heterogeneous resources,

followed by Valence Technology and Fuji Photo film.

17

Figure 10: Citation networking graphic of structure holes

4.6 Technology field analysis

In this paper, USPTO patent data is used by us as the source for analysis. The

technological filed of battery technology is delimited using the International

Patent Classification (IPC). We use the main five components of battery to explore

its trend of patent application in details by IPC subclasses. This method has also

been used to explore the dynamics of the technological filed in the

telecommunication technology (Grebe et al., 2006) and LAN technology (Fontana

et al., 2008).

It can be noted that the distribution of patents across subclasses in uneven as

shown in table 3. Subclass H01M002 who refers to Electrodes accounts of more 50

% of the total patents by 2,721 issued ones. Followed by H01M01 who refers to

secondary cells; manufacture thereof by 1,213 ones.

Table 3: The distribution of lithium battery patent by IPC subclass

Types Descriptions of Subclass IPC subclass The amount

of patent

A Electrodes H01M004 2,721

B Secondary cells; Manufacture thereof H01M010 1,213

18

C Constructional details, or processes of

manufacture, of the non-active parts H01M002 737

D

Circuit arrangements for charging or

depolarizing batteries or for supplying

loads from batteries

H02J007 488

E

Investigating or analyzing materials by the

use of electric, electro-chemical, or

magnetic means

G01N027 223

*In the account, one patent may categorized by more than one subclass, resulting

in single could be accounted repeatedly.

Figure 11: Trend of battery subclass patents since 1976-2012

Figure 11 shows that the share in the total number of patents overtime for

each subclass.in this figure we have highlighted the shares for the four classes

mentioned above. Comparing with the other four subclasses, the growth in the

shares is particularly evident in the case of H01M004 (Electrodes). The patent of

this subclass has increased significantly in the past decades, especially between

1995 and 2005. And further we witness another sharply increase between 2009

and 2010. The first wave of growth in this subclass is interpreted by the strong

demand to lithium battery for the use of notebooks and mobile phones. The

19

second wave of growth is interpreted that the demand is driven by the use of

smart phones and electric vehicles. While subclass H01M010 and G01N027 have

increased slowly, because the two types of technologies have been developed for a

long time.

Furthermore, from the top cited 20 patents list shown in the table 5, the most

cited patent is US 5910382, which has cited 166 times by the other patents. This

core patent applied by University of Texas Systems and was granted in 1999. The

description of this patent is cathode materials for secondary (rechargeable)

lithium batteries. It was invented by John B. Goodenough, Akshaya K. Padhi, K. S.

Nanjundaswamy and Christian Masquelier. Professor Goodenough has lead his

research team involving in the development of cathode materials and granted 29

patents in US, including US 6514640 who has also high citation number. In 2011,

Hydro-Quebec obtained the ownership of the two critical patents from University

of Texas Systems.

Table 5: Top 20 cited patents in battery

No Patent No Issue Assignees Transfer

Cites

In

total

Self-

cite cited Descriptions

1 5910382 1999.6.8 University of

Texas Systems

HYDRO-QUEBEC

炷2011.1.27炸 166 0 166

Cathode materials for

secondary

(rechargeable)

lithium batteries

2 6025094 2000.2.15 PolyPlus Battery

Company, Inc. 116 4 112

Protective coatings

for negative electrodes

3 5523179 1996.6.4 PolyPlus Battery

Company 102 24 78

Rechargeable positive

electrode

4 5824434 1998.10.2

0

Canon Kabushiki

Kaisha 97 21 76 Secondary battery

5 4917974 1990.4.17 USA/DOE

THE UNIVERSITY

OF CALIFORNIA

炷1990.5.11炸

86 0 86

Lithium/organosulfur

redox cell having

protective solid

electrolyte barrier

formed on anode and

method of making

same

6 5169736 1992.12.8

Varta Batterie

Aktiengesellschaf

t

NBT GMBH

炷2001.3.21炸 83 1 82

Electrochemical

secondary element

20

7 5783333 1998.7.21 PolyStor

Corporation

JOHNSON

CONTROLS

TECHNOLOGY

COMPANY

炷2006.12.8炸

87 0 87

Lithium nickel cobalt

oxides for positive

electrodes

8 5529860 1996.6.25 Moltech

Corporation * 78 39 39

Electroactive high

storage capacity

polyacetylene-co-poly

sulfur materials and

electrolytic cells

containing same

9 5187033 1993.2.16

Matsushita

Electric Industrial

Co., Ltd.

77 2 75 Lithium secondary

battery

10 6514640 2003.2.4 The University of

Texas System

HYDRO-QUEBEC

炷2011.1.27炸 85 1 84

Cathode materials for

secondary

(rechargeable)

lithium batteries

11 5147739 1992.9.15 Honeywell Inc.

ENERSYS

ADVANCED

SYSTEMS INC.

炷2006.5.18炸

72 0 72

High energy

electrochemical cell

having composite

solid-state anode

12 5478673 1995.12.2

6

Fuji Photo Film

Co., Ltd.

UBE INDUSTRIES,

LTD.炷2002.6.20炸 71 1 70

Nonaqueous

secondary battery

13 5478674 1995.12.2

6

Fuji Photo Film

Co., Ltd.

UBE INDUSTRIES,

LTD.炷2004.7.15炸 71 2 69

Nonaqueous

electrolyte-secondary

battery

14 5110696 1992.5.5

Bell

Communications

Research

65 0 65

Rechargeable

lithiated thin film

intercalation electrode

battery

15 5545468 1996.8.13

Matsushita

Electric Industrial

Co., Ltd.

64 1 63

Rechargeable lithium

cell and process for

making an anode for

use in the cell

16 5538814 1996.7.23 Mitsubishi Cable

Industries, Ltd. 66 0 66

Lithium secondary

battery

17 5053297 1991.10.1 Sony Corporation 63 4 59 Nonaqueous

21

electrolyte secondary

battery

18 6203944 2001.3.20

3M Innovative

Properties

Company

62 25 37 Electrode for a lithium

battery

19 6007947 1999.12.2

8

PolyStor

Corporation

JOHNSON

CONTROLS

TECHNOLOGY

COMPANY

炷2006.12.4炸

62 0 62

Mixed lithium

manganese oxide and

lithium nickel cobalt

oxide positive

electrodes

20 5478671 1995.12.2

6

Fuji Photo Film

Co., Ltd.

UBE INDUSTRIES,

LTD.炷2002.6.20炸 59 1 58

Nonaqueous

secondary battery

5. Discussion

More and more scholars in the era of innovation and technology

management are interested in using patent data to explore the diffusion and

development of energy technologies such as nanotechnology (Li et al., 2007), solar

power, electric vehicles(Bayindir et al., 2011; Pilkington et al., 2002; Oltra, 2009;

Wang, 2011). Most of them focus on discussion on the firm level, but few

literatures focus on the sectoral or industrial level, resulting in the lack of a whole

picture of the evolution in a certain energy industry. This study attempts to use

patent citation analysis method, exploring the evolution of electric vehicle battery

technology through the SSI framework. It contributes three folds: 1) Lithium

battery is a key technology for electric vehicles throughout patent data analysis. 2)

The main acts of lithium battery in a current market correspond with patent

owns and patent citations. 3) The structure hole helps understand the resource

position and industrial development pattern for electric vehicle battery.

In addition to identify the key patent, actors and networks as similar with

other works did through using the patent analysis, this study attempts to divide

the past three decades (1976-2012) into three period of time(1976-1990;

1990-2010;2000-2012), observing the development of this technology. The three

group of periods are closely related with the events of global oil price shock

occurred in the same period. It is examined by Cheon and Urpelainen (2012) that

there is a positive relationship in between oil price and energy technology

innovation (patent applied amount). Consequently, it figures out that lithium

battery has different application as the advance of its technology and the change

of market demand. One interesting finding is that lithium battery initially used to

scale down to small size for the use of 3C products and then scale up its capacities

22

to be embedded in EVs.

It reveals that lithium battery has gradually replaced lead acid and nickel

metal hydride battery as the main battery technology applied on the electric

vehicle since 1990, due to the amount of patent in lithium did far exceed the

others then. However, why Toyota equipped the lithium batteries with its new

model EV: Vitz until 2003? There is a ten years behind. One explanation is well

accepted that compares with chemical industry and notebook industry and

market, automobile makers and consumers are more concerned about the safety,

in addition to lithium battery has better performance than other type of batteries

in terms of power density, energy density and life cycle. But lithium battery had

poor performance on safety than nickel metal hydride battery in the early 2000s.

This study also examines that there are a few amount of key firms located in

the structure holes. In means that most of firms have low power to control

resource and obtain of heterogeneity resource in this battery network. In the

other word, most of EV battery firms (or even car makers) are difficult to delegate

their R&D investment on a certain lithium battery, as the dominant technology is

still undecided or unclear. In addition, the market demand also influences the

selection of the battery technology accordingly.

Automobile or vehicle industry has been recognized as a close innovation

system in terms of its specific ecosystem in the past. Traditional giant car makers

such as GM, Toyota, Nissan, Ford, etc. can control most of core technology,

especially the engine technology, and resources, such as outsourcing suppliers. In

that field, the technology regime is controlled by those car makers, high

cumulativeness, high appropriability of innovation and low degree of accessibility.

New entrants are difficult to join the close supply chain in the automobile industry.

However, when the EV became an alternative and the batteries replace the engine

as the source of power to the cars, something is changed. Some new entrants or

firms from other industry have good opportunity to join or even dominant this

industry(Christensen & Rosenbloom1996/1997; Foster, 1986) . Taking the

example of University of Texas systems which have some critical patent on the

C-LiFePO4, many firms whoever car maker or battery makers ask to cooperate

with this organization. Taking another example, 3C battery maker Panasonic has a

chance to establish a partnership with car maker, Toyota through the trade on

complementary assets thanks to it has many important patents on producing

batteries in hands. It reveals another two points: one is that the non-firm

organization such as the research institute and university, which plays a very

23

important role at the early stage of the development of lithium battery technology;

the other one is that path dependence is important during the developing process

of lithium battery. Owing to Panasonic has comprehensive experience and

knowledge to manufacture small capacity battery for the use of 3C products, it can

produce the high scale and capacity battery for the EV╆s use easier than the actors

from other industries or car makers.

6. Conclusion

This study figures out that the three building blocks: knowledge and

technologies, acts and networks, and institutions are interacted with one another

closely. There is a co-evolution relationship among them. The advance of the

knowledge and technology in lithium battery has been driven by the market

demand. With more and more actors who are new entrants or from other industry

such as 3C industry or else join the development of this technology and more

networks or clusters is established, the lithium battery develops rapidly and in

diversify. Institution shapes the activities of actors and networks. Owing to the

support from the global and national institution such as the constraint on the

emission of CO2 and R&D funding, the spill over and diffusion effect of technology

will be more obvious. This study claims that the development of the lithium

battery technology has a positive relationship with the market demand.

Limitations in this study are two folds: 1) the patent data collection is only

from the USPTO data, but not extend to use another database from China, Japan,

Korea and Europe. Thus the patent analysis has its limitation; 2) the patent

amount of vehicle-specific lithium battery is still big enough, this limitation partly

result from EV industry is at the early stage of the development, most of patents

are yield in the past decade, and partly the long approval time of US patent

application, a great deal number of applications are still under the process. Thus,

the patent analysis in this study cannot show a perfect result. In addition, even

though the institution is well accepted to influence the innovation significantly,

this study has not provided an empirical result here.

This study attempts to conduct three phases of period patent citation analysis

and structure holes perspective, exploring the evolution of battery technology

and the feature of the industry. This study claims that the emerging of EV

industry has opened an opportunity window for some new entrants, specifically

the battery makers into the supply chain in the automobile industry. But it

needs to bear in mind is that if the battery makers cannot carry on obtaining

the core competence, the car makers who have strong knowledge and capital

24

power will kick them out of the industry in the near future.

25

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