$QuantumScape(QS.US) 

Product Progress (Solid-state Battery Technology Development and Verification)

QuantumScape has achieved significant milestones in solid-state battery technology over the past year, successfully transitioning from prototype validation to sample delivery phase. In terms of battery performance, QuantumScape completed the A-sample test of a 24-layer cell by the end of 2023, significantly exceeding industry requirements: after more than 1000 complete charge-discharge cycles, the battery still maintains over 95% capacity. This cycle life is significantly higher than the industry standard at the same stage (about 700 cycles, capacity decay within 20%). According to Volkswagen Group's test results, it is estimated that an electric vehicle with a range of 500-600 kilometers can travel 500,000 kilometers with 95% battery capacity remaining, without significant range degradation. In addition, the 24-layer A-sample cell has a capacity of about 5 Ah, with an energy density of 301 Wh/kg (weight ratio) and 844 Wh/L (volume ratio); and supports fast charging – it can charge from 10% to 80% in 12.2 minutes. This indicates that QuantumScape's solid-state battery is expected to achieve high energy density and high-speed charging performance.

In terms of safety performance, QuantumScape has disclosed multiple rigorous test results: its 24-layer prototype cell (Alpha-2 design) performed excellently in the puncture test with a Hazard Level 2 score (only slight temperature rise after internal short circuit, no thermal runaway or fire). This is attributed to the stability of the ceramic solid-state electrolyte, which does not melt like traditional polymer separators during puncture, triggering chain thermal runaway. In the heat resistance test, QuantumScape cells only released slight gas at temperatures up to 300°C (Hazard Level 3), without catching fire; in contrast, traditional liquid lithium batteries trigger thermal runaway and burn at about 184°C (Hazard Level 6). This demonstrates the safety advantage of ceramic solid-state separators as a natural firewall, even with 24 layers of such separators stacked inside the cell, significantly reducing the probability of thermal runaway spread. QuantumScape believes its solid-state electrolyte separator not only improves safety but also has the potential to simultaneously outperform existing high-energy-density lithium-ion batteries in terms of energy density, power, fast charging, and lifespan.

In terms of technology verification phase, QuantumScape completed the important transition from A-sample to B-sample in 2024: starting from October 2024, the company began small batch trial production and delivery of B-sample cells to automotive customers. The B-sample cell is QuantumScape's planned first commercial product QSE-5, a solid-state battery unit for automotive use with a capacity of about 5 Ah. Its specifications were first publicly disclosed in the industry: at C/5 discharge rate, 25°C, it can store 21.6 Wh of energy (corresponding to the aforementioned 844 Wh/L), and maintain high performance comparable to the A-sample. The launch of the B-sample marks the transition of QuantumScape technology from laboratory to automotive application verification: these low-volume samples have been shipped to partners such as Volkswagen for testing and verification on actual EV platforms. Earlier, QuantumScape had delivered Alpha-2 stage samples to customers in the first half of 2024 for preliminary verification. With the advent of the B-sample, QuantumScape announced the completion of all four major goals set at the beginning of 2024, including: initiating low-volume B-sample production and delivery, introducing the new generation of separator process (Cobra), achieving Raptor process mass production, and delivering Alpha-2 test units. This series of achievements indicates that QuantumScape has successfully advanced from single-layer, few-layer prototype development stage to scale manufacturing verification stage of dozens of layers of cells, laying the foundation for subsequent product commercialization.

Manufacturing Capability (Production Line Construction, Capacity Goals, and Process Progress)

In terms of manufacturing, QuantumScape has focused on improving the production capacity of solid-state battery separators over the past year, building trial production lines and optimizing key processes to meet future mass production needs.

Production Facilities and Capacity Layout: QuantumScape's current core trial production facility is the QS-0 pre-production line located in San Jose, California. QS-0, as a leading trial line for continuous processes, is mainly used to produce engineering samples for automotive partners to test and is the foundational platform for subsequent technology transfer. The company announced in 2021 that it would double the planned capacity of QS-0 to 200,000 battery pieces per year, enough to support the use of hundreds of test vehicles annually. This production line has been gradually put into operation since 2023, but some process challenges have been encountered during output enhancement. According to the California project report, QuantumScape purchased approximately $52 million worth of production equipment for QS-0 from 2022 to 2024 (about 45% of the original plan), but due to the introduction of new processes and solving production issues, progress has been extended. For this reason, the company applied to California to extend the use period of tax incentives to eliminate process faults and complete production line debugging. The report pointed out that QuantumScape experienced unexpected material contamination issues during the trial production line ramp-up and has invested time to identify and eliminate the root cause. Meanwhile, the company proactively upgraded the separator manufacturing process, introducing faster processes (codenamed "Raptor" and "Cobra") to replace the initial plan. Although these adjustments caused short-term delays, they significantly improved the efficiency and capacity of the trial production line in the long run. In 2024, QuantumScape has successively expanded engineering lines in San Jose and plans to add approximately $65 million in capital expenditures in 2025 and $45 million in 2026 to expand sample output to meet customer testing needs. Currently, the QS-0 line is operational and continues to ramp up, accumulating process data for subsequent mass production transfer.

In terms of large-scale manufacturing layout, QuantumScape and its main partner Volkswagen Group have adjusted the original plan, shifting to a more flexible expansion model. The original "QS-1" factory (QuantumScape and Volkswagen's joint venture mass production line) was planned in 2021 as a 1 GWh solid-state battery trial production plant in Salzgitter, Germany, with a long-term expansion of 20 GWh capacity. However, in July 2024, QuantumScape and Volkswagen's battery company PowerCo reached a new milestone agreement to achieve scale production through technology licensing rather than joint venture factory. According to the agreement, after QuantumScape technology meets the agreed progress and receives certain patent fees, PowerCo will obtain a non-exclusive license to produce up to 40 GWh (expandable to 80 GWh) of batteries annually, enough to equip one million electric vehicles per year. This agreement replaces the earlier QS-1 joint venture plan and is seen as a "light asset" industrialization path: QuantumScape focuses on core technology and sample supply, while Volkswagen PowerCo invests heavily in building mass production facilities and undertakes industrialization work. The two parties will form a joint team to accelerate technology amplification and process definition, and develop targeted development for a future mass production model of Volkswagen Group. This cooperation ensures that when QuantumScape technology matures, it can leverage Volkswagen's existing global factories to quickly achieve Gigafactory scale production capacity while reducing QuantumScape's capital pressure for independent factory construction. PowerCo is currently building three battery factories in Salzgitter, Germany, Valencia, Spain, and St. Thomas, Canada (with a total planned capacity of 200 GWh/year), all of which are expected to introduce QuantumScape solid-state battery production lines. It can be seen that under the encouragement of policies in North America and Europe, QuantumScape is embedding its technology into the planning of large battery bases through authorized cooperation mode, aiming to start scale production around 2025-2026 (Note: Volkswagen has not yet announced the precise mass production schedule, but QuantumScape's internal roadmap targets more B-sample deliveries in 2025 and entering C-sample and initial commercialization stage after 2026).

Key Process Progress and Bottlenecks: One of the difficulties in mass production of solid-state batteries is the manufacturing speed and yield of ceramic electrolyte separators. QuantumScape has overcome major bottlenecks in the separator heat treatment process over the past year, launching a new generation of separator sintering equipment codenamed "Cobra". In December 2024, QuantumScape announced the successful development and installation of Cobra equipment for initial separator production. Cobra is a cross-generation improvement of the previous separator process "Raptor": it increases the separator sintering/heat treatment speed by about 25 times, significantly reducing the unit membrane production footprint. According to the company, the introduction of Cobra greatly improves the feasibility of large-scale production of ceramic separators, significantly reducing the number and space of equipment required for future GWh-level factories. QuantumScape co-founder and CTO Tim Holme said Cobra is a true breakthrough in the field of ceramic manufacturing, making the scaling of the company's battery technology possible. By June 2025, QuantumScape has successfully integrated the Cobra process into the baseline production, replacing the original Raptor process, announcing the achievement of this annual key goal. Cobra is now the new baseline for QuantumScape separator production, and the company is using it to increase B-sample capacity and prepare for higher batch production in the B1 stage. Correspondingly, Raptor, as the previous generation fast separator process, was introduced into QuantumScape's mass production process in the third quarter of 2024 for the manufacture of initial B0 samples. Raptor has improved separator quality and process stability compared to early experimental processes, while Cobra further significantly enhances speed and efficiency on this basis. It can be said that the improvement of separator sintering efficiency greatly alleviates the engineering bottleneck of solid-state battery manufacturing. In the past, in the trial production of solid-state/semi-solid batteries, the separator coating and processing speed was only about 1/30 of traditional lithium battery coating lines, severely limiting capacity and driving up costs. QuantumScape is gradually bridging this gap through self-developed new processes, laying the foundation for future large-scale mass production. The company expects that as Cobra continues to optimize iterations, its production speed, energy efficiency, and yield rate will continue to improve.

Capacity Goals and Mass Production Timeline: Based on the above layout, QuantumScape's recent goal is to provide customers with larger batches of B-sample cells in 2025, transitioning from "small batch engineering samples" to "high batch samples". This means the production line needs to have stable production capacity of thousands to tens of thousands of batteries per year to meet the testing needs of multiple automotive projects. In the long term, through industrial cooperation with Volkswagen PowerCo, QuantumScape technology is expected to enter C-sample trial production and vehicle integration verification in 2026-2027, and start initial commercial mass production around 2027-2028 (corresponding to several GWh levels per year), gradually moving towards the authorized capacity limit of 40-80 GWh/year. It should be noted that there is still uncertainty in the scale of solid-state battery production, and the company has not officially announced the production year. However, Volkswagen's statement is very positive: PowerCo CEO Frank Blome said these test results and cooperation are important milestones towards solid-state battery mass production, and will "accelerate" the industrialization of this technology. QuantumScape also emphasizes that it has established a record of continuously delivering milestones as planned, confident in achieving GWh-level ramp-up in the coming years. Overall, through trial production line ramp-up + process breakthrough + cooperation authorization, QuantumScape is gradually solving the engineering challenges of solid-state battery production, steadily moving towards mid-to-late testing and initial mass production goals.

Competitive Landscape (Comparison of Chinese Solid-state Battery Companies and QuantumScape's Competitiveness)

Globally, solid-state batteries are regarded as next-generation disruptive technology, and companies in various countries are accelerating their layout. Especially in China, multiple battery giants and startups have made significant progress over the past year, forming a competitive landscape with QuantumScape, each with its own characteristics. The following focuses on comparing the technical paths, mass production progress, and customer binding situations of major Chinese companies, and analyzing QuantumScape's relative competitiveness.

CATL: As a global leader in power batteries, CATL maintains high investment in solid-state battery research and development, with a focus on the all-solid-state sulfide system as the main direction. According to its chief scientist Wu Kai, CATL's current solid-state battery technology maturity is about level 4 (1-9 evaluation system), with a goal to reach level 7-8 by 2027, meaning limited trial production can be achieved by then. In other words, CATL plans to start limited mass production of solid-state batteries around 2027, and gradually expand scale thereafter. For this purpose, the company invests in multiple technical routes, not only including sulfides but also covering oxides, polymers, and other mixed routes to ensure capturing the most feasible solution. Currently, CATL has not disclosed specific performance data similar to QuantumScape, but it released a "Condensed Battery" with claimed energy density of 500 Wh/kg in 2023, believed to be a transitional product of semi-solid/gel electrolyte technology for aviation and high-performance vehicles. This battery is preparing for vehicle testing, showing CATL's intention to gradually increase energy density to transition to the all-solid-state era. In terms of customers, CATL has a broad base of OEM cooperation, and its future solid-state battery products are expected to mainly supply domestic automakers. There are reports that CATL plans to start small-scale mass production of all-solid-state batteries in 2027 and gradually ramp up after 2030. Overall, CATL has advantages in solid-state battery scale landing due to its strong manufacturing and supply chain capabilities, but its current technical progress is slightly behind QuantumScape: its target mass production time is after 2027, while QuantumScape and Volkswagen strive to achieve initial mass production verification around 2026. This means QuantumScape may lead in technology maturity for a period. However, CATL, backed by China's vast market and industrial cluster, has the ability to quickly scale up once technology breakthroughs occur.

BYD: BYD is relatively low-key in the field of solid-state batteries but is also accelerating research and development. According to market news, BYD tends to adopt the "lithium metal anode + sulfide solid-state electrolyte + high nickel cathode" technical route, combined with silicon-based anode prelithiation and other processes to balance energy density and cycle stability. It is rumored that its goal is to achieve solid-state batteries with energy density exceeding 280 Wh/kg. BYD plans to demonstrate small batch installation of all-solid-state batteries on its high-end models in 2027, with a scale of about 1000 vehicles. By 2030, BYD expects about 40,000 new energy vehicles to be equipped with solid-state batteries; by 2033, it will expand to about 120,000 vehicles. This indicates that BYD adopts a pragmatic gradual route, first using flagship models for trial, and then gradually promoting over the next decade. In terms of customer binding, BYD's solid-state batteries will first be applied to its own brand (such as high-end sub-brand "Denza" or high-performance models) to fully integrate R&D and vehicle advantages. BYD is good at safety design such as blade batteries, and if its all-solid-state solution succeeds, it will enhance its vehicles' selling points in terms of safety and energy density. Compared to QuantumScape, BYD has not yet disclosed specific performance data and milestone time, but its small batch application time point (2027) is close to QuantumScape's expected commercialization node. BYD's advantage lies in the integration capability of the entire electric vehicle industry chain, and once solid-state batteries mature, they can quickly land on vehicles for verification and obtain market feedback. This is different from QuantumScape's model of relying on cooperative automakers for testing. However, in terms of real material and process breakthroughs, BYD has not yet demonstrated clear technical indicator results like QuantumScape, and its success depends on whether it can solve the mass production difficulties of the sulfide solid-state route within ten years.

Ganfeng Lithium: As China's largest lithium material supplier, Ganfeng has actively expanded downstream battery layout in recent years, especially leading in the field of solid-state batteries. Ganfeng's subsidiary Ganfeng Lithium (also known as FunLithium) adopts a "mixed solid-liquid" technology route and announced the start of mass production of the first generation of solid-state batteries in May 2023. This "first generation solid-state battery" is actually a solid-liquid hybrid lithium-ion battery with an energy density of about 260 Wh/kg, mainly characterized by using part of solid-state electrolyte to enhance safety and thermal stability. Ganfeng has built a production line with an annual design capacity of 4 GWh in Ningbo for manufacturing this solid-state battery. Currently, these batteries have been introduced into portable energy storage, electric two-wheelers, smart robots, and other fields, and have small-scale demonstration operations on new energy vehicles. Notably, in December 2023, Ganfeng Lithium signed a strategic cooperation memorandum with Changan Automobile, planning to jointly accelerate the research and industrialization project of semi-solid/full-solid-state batteries. The two parties will establish a joint venture company through equal share cooperation to promote the development and manufacturing of new generation power batteries. Changan Chairman Zhu Huarong stated that they will leverage Ganfeng's advantages in the entire industry chain to jointly build a solid-state battery R&D and manufacturing base with international competitiveness, accelerating the industrialization of China's solid-state battery technology. This means Ganfeng's second generation full-solid-state battery will target vehicle-grade applications and deeply integrate with Changan's new models. According to Ganfeng, its second-generation product fully meets vehicle-grade safety requirements and is expected to achieve mass production around 2027. Ganfeng's strength lies in lithium resources and materials, and it has opened up the entire chain from upstream lithium extraction, lithium salt manufacturing, to downstream battery trial production. This gives it unique advantages in solid-state battery material innovation and cost control. Meanwhile, Ganfeng is actively expanding overseas, and according to 2024 news, Ganfeng plans to cooperate with Turkey to build a battery factory with an annual production capacity of 5 GWh and establish a new technology R&D center covering solid-state batteries. Overall, Ganfeng Lithium is one of the pioneers in China's solid-state battery field, currently achieving small-scale mass production and vehicle demonstration (rare in the industry), and locking in future markets through vertical cooperation with automakers such as Changan. Compared to QuantumScape, Ganfeng takes the "material-battery-automaker" deep binding route, with policy and resource advantages in the Chinese market. However, technically, Ganfeng currently enters with a **"semi-solid lithium-ion"** form, with energy density (260 Wh/kg) slightly lower than QuantumScape's full-solid-state prototype (300+ Wh/kg), and cycle life and fast charging capabilities have not yet been publicly compared directly. Whether Ganfeng can achieve similar breakthroughs to QuantumScape in full-solid-state (metal lithium anode) remains to be verified by its second-generation products.

WeLion: WeLion is a Chinese solid-state battery startup founded by a team from the Institute of Physics, Chinese Academy of Sciences, and has gained attention in recent years due to its cooperation with Nio. WeLion adopts a "semi-solid" technology route, using solid-liquid mixed electrolytes in batteries to achieve higher energy density than traditional lithium batteries. As early as the end of 2020 at NIO Day, Nio announced that it would equip its vehicles with a 150 kWh semi-solid battery pack provided by WeLion, with a single energy density of 360 Wh/kg, enabling the vehicle to exceed 1000 kilometers of range. This 150-degree battery pack is regarded as the world's first high-energy-density semi-solid battery applied to vehicles. According to the original plan, it should have started vehicle delivery in Q4 2022. However, actual progress has been delayed, and Nio President Qin Lihong has repeatedly explained that R&D verification took longer than expected, and the mass production delivery time was postponed again in mid-2023. Finally, in the second half of 2023 (around August), Nio began providing rental services for the 150 kWh battery pack through its battery swap system, with limited installation on models such as ET7 and ES7, achieving the world's first semi-solid battery on-board (although the scale is limited). Tests show that this semi-solid battery pack can achieve a measured range of over 1000 kilometers, verifying its high energy density performance. However, the WeLion/Nio solution currently faces challenges of high cost and slow production ramp-up: Qin Lihong bluntly stated that the cost of the 150-degree battery pack is equivalent to the price of a Nio ET5 vehicle (about 300,000 yuan), mainly due to low manufacturing efficiency and low yield rate. For example, industry insiders pointed out that traditional liquid battery coating machines coat hundreds of meters of electrodes per minute, while semi-solid batteries are limited by new processes, with a speed of only about 1/30, severely dragging down production efficiency and driving up costs. WeLion Chief Scientist Li Hong also analyzed that the commercialization of full-solid-state batteries requires solving three major problems: introducing electrolyte material preparation processes, solid-solid interface impedance, and balancing high performance with low cost. These problems have already emerged in WeLion's current semi-solid batteries: although performance is leading, mass production costs remain high, and in the short term, they are still small batch high-priced products. Despite this, WeLion is highly favored in the capital market, having received multiple rounds of investment from Xiaomi, Huawei, and others, with a valuation once as high as 15 billion yuan. Its next plan is to launch a true full-solid-state battery between 2025 and 2027. According to reports, WeLion expects to achieve mass production of full-solid-state batteries around 2027. As Nio's battery unicorn behind the scenes, WeLion's advantage lies in backing top scientific research teams and OEM application scenarios, having already taken the lead in bringing semi-solid technology to the passenger car market and gaining valuable data in practice. This is something QuantumScape has not yet achieved (its B-sample battery is expected to be tested on vehicles in 2025). However, QuantumScape's technical path (oxide ceramic + lithium metal) and WeLion/Nio (solid-liquid mixed + high nickel silicon anode) are different, each with its advantages and disadvantages: the former has outstanding data in cycle life and safety, while the latter has run through 1000 kilometers of range with extremely high energy density. The two may form indirect competition in the high-end electric vehicle field in the future.

Other Players and Overall Situation: In addition to the above companies, China also has Gotion High-tech, EVE Energy, Svolt Energy, Qingtao Energy, ProLogium Technology, and others advancing solid-state battery research. For example, Gotion launched a 350 Wh/kg full-solid-state battery sample in 2024 and plans to conduct vehicle trials in 2027; EVE chooses a sulfide + halide composite electrolyte route, planning to break through processes in 2026 and launch a 400 Wh/kg full-solid-state battery in 2028; Svolt has prepared a 20Ah sulfide full-solid-state battery (380 Wh/kg), but sets the mass production time point for high-end models after 2030. Overall, Chinese companies mostly adopt sulfide solid-state or solid-liquid mixed technology, with mass production time generally targeting the 2025-2030 range for gradual landing. Meanwhile, Japan's Toyota is also advancing rapidly, owning 1300+ solid-state battery patents and planning to launch pure electric models equipped with full-solid-state batteries as early as 2027. In contrast, QuantumScape, with its unique path of ceramic separator + lithium metal, has achieved more hardcore technical indicator breakthroughs (1000 cycles with 95% capacity retention, high safety fast charging, etc.) in the past year, and locked in priority commercialization channels through cooperation with Volkswagen. QuantumScape's current relative competitiveness is reflected in: its technology verification level is at the forefront of the industry (already at the B-sample stage and delivered to automakers for testing), performance data is comprehensive (energy density, lifespan, safety all have highlights), and cooperation with mainstream Western automakers is close (deeply bound with Volkswagen Group). However, QuantumScape also faces challenges: mass production ramp-up and cost control are the key to competing with Chinese and Japanese competitors in the next stage. If QuantumScape can successfully achieve several GWh capacity ramp-up in 2025-2026 and maintain technological leadership, it is expected to occupy a first-mover advantage in the global high-end electric vehicle solid-state battery market. Conversely, if mass production is hindered and costs remain high, Chinese manufacturers, with their larger manufacturing systems and domestic market, may catch up and even surpass in scale at a slightly later time. It can be foreseen that the next five years are the key window period for solid-state battery commercialization: QuantumScape needs to consolidate its technological leadership and quickly push to the market, while Chinese companies are catching up with policy and funding support, and the competition in the solid-state battery track will become increasingly intense.

Table: Comparison of QuantumScape and Some Chinese Companies' Solid-state Battery Progress:

Note: The above mass production time is inferred from public information, and actual progress depends on technological breakthroughs and industrialization conditions.

QuantumScape's Relative Competitiveness Analysis: From the above comparison, it can be seen that QuantumScape is currently in a leading position in terms of technology maturity and performance verification. Its full-solid-state lithium metal technology has been independently verified by Volkswagen Group, becoming the first solid-state battery to announce a thousand-cycle lifespan and be confirmed by OEMs to meet standards. In contrast, most Chinese companies are still in the laboratory or small-scale demonstration stage, and have not disclosed cycle and fast charging data under the same rigorous conditions. QuantumScape's fast charging capability (10→80% charge in 12 minutes) is also outstanding among existing solid-state solutions; and the safety aspect of the measured results (no fire in puncture, no combustion at 300°C) sets a benchmark. This performance combination (high energy + fast charging + long lifespan + high safety) is exactly the next-generation battery indicators that automakers dream of. Considering industry partners, QuantumScape has locked in potential capacity output of tens of GWh in the future through Volkswagen PowerCo, and has become part of Volkswagen Group's solid-state battery strategy. Volkswagen executives have clearly stated that QuantumScape technology will serve its global electric vehicle fleet in the future, maintaining leadership. This deep binding increases the certainty of QuantumScape's technology commercialization. In the Chinese market, due to international situation and technology blockade, QuantumScape has no direct entry plan, and Chinese companies will compete in the domestic market and may independently form technical standards. Therefore, QuantumScape's main battlefield is in Europe and the United States with high-end joint venture brands, and it needs to achieve mass production and vehicle application success in the Western market first to consolidate its leading advantage.

It should be noted that the solid-state battery track is full of uncertainty, and each company's technical route has different difficulties: for example, QuantumScape's oxide ceramic separator performs well in inhibiting lithium dendrites and high-temperature stability, but preparation cost and thickness control are challenges; while the sulfide system has high ion conductivity and easy interface adhesion, but sensitive to humidity and complex processes, Chinese companies must overcome material stability and scale manufacturing difficulties. In the next few years, patents and intellectual property may also affect the competitive situation (detailed below). Overall, QuantumScape has already occupied the technological high ground and the first batch of customer resources in the global solid-state battery race, but still needs to accelerate crossing the "chasm" of mass production. Meanwhile, Chinese companies, relying on strong manufacturing capabilities, are catching up. The outcome of this "battery revolution" is undecided, and whether QuantumScape can maintain its lead will depend on its execution in the engineering and commercialization stages, as well as the performance of competitors in their late-stage catch-up.

Partners and Customer Expansion (Automaker Cooperation, Sample Delivery, and Potential Customers)

Since its establishment, QuantumScape's most important partner has been Volkswagen Group. Over the past year, the relationship between the two parties has become closer, and new cooperation models have been implemented.

Volkswagen Group/PowerCo: Volkswagen has been investing in QuantumScape since 2012 and is one of its largest external shareholders. From the end of 2023 to the beginning of 2024, QuantumScape provided Volkswagen's battery company PowerCo with 24-layer A-sample cells for rigorous testing, and Volkswagen subsequently officially announced in January 2024 that QuantumScape batteries met and exceeded A-sample stage requirements. PowerCo's tests proved that the battery cycle life exceeded 1000 times, with 95% capacity retention, far superior to the then indicators. Volkswagen PowerCo CEO Frank Blome said this is an "exciting result" towards mass production, strengthening Volkswagen's confidence in solid-state battery commercialization. Based on years of cooperation trust, in July 2024, Volkswagen PowerCo and QuantumScape announced a milestone agreement: QuantumScape will authorize its solid-state battery technology to PowerCo for mass production, and PowerCo will obtain up to 80 GWh/year (initially 40 GWh) production license. In return, PowerCo will pay license fees and jointly invest in technology industrialization with QuantumScape. More importantly, this marks Volkswagen's confirmation of QuantumScape as its first solid-state battery supply partner, and future Volkswagen brand models (Audi, Porsche, etc.) are expected to be the first to equip QuantumScape's batteries. Volkswagen Group's technical director Thomas Schmall publicly stated that cooperation with QuantumScape can ensure Volkswagen's global fleet obtains this breakthrough battery technology for many years, setting new benchmarks for its electric vehicles in terms of range, charging, etc. To focus on advancing cooperation, Volkswagen-appointed QuantumScape director Frank Blome resigned from the board and turned to fully lead Volkswagen's internal collaboration project with QuantumScape. It can be said that Volkswagen Group fully supports QuantumScape from capital, testing to production, viewing it as a key ally in achieving solid-state battery mass production. This binding not only brings reliable first automaker customer, but also provides endorsement for QuantumScape to expand other customers in the future.

Other Automakers: In addition to Volkswagen, QuantumScape has not publicly disclosed specific other OEM customer lists. However, the company revealed in 2024 that it has sent Alpha-2 samples to multiple customers for testing; when B-sample battery production started, it also mentioned that it was being delivered to automotive customers for testing. This suggests that QuantumScape has contact and cooperation with multiple global mainstream automakers, likely including first-tier brands in the United States and Europe. Currently, due to confidentiality and competition, specific automaker names have not been disclosed. However, industry analysis believes that companies such as Mercedes-Benz, Ford, Hyundai, etc. are highly interested in solid-state batteries, and it is not ruled out that they have signed testing agreements with QuantumScape. QuantumScape management has also repeatedly mentioned receiving "strong technical demand," implying that there are already multiple OEMs waiting in line for samples. Therefore, in addition to Volkswagen, QuantumScape is gradually building a potential customer base, expanding future commercial cooperation by providing samples and test data. It is particularly worth mentioning that QuantumScape's business model is not to assemble battery packs for end consumers, but more like a **"B2B battery supplier": providing cells or technology authorization to OEMs or Tier 1 suppliers to jointly develop battery solutions adapted to models. This means QuantumScape can cooperate with multiple automakers simultaneously, rather than being limited to one brand. Once the technology matures in the future, QuantumScape is expected to announce new strategic partners** in addition to Volkswagen. The current primary task is to let these customers verify performance in B-sample testing and sign intention orders to lock in commercial conversion opportunities.

Tier 1 Suppliers: So far, there is no public information showing that QuantumScape has direct cooperation with traditional automotive parts Tier 1 suppliers. Tier 1 in the solid-state battery field may include battery pack integrators or power system suppliers. However, QuantumScape is more directly cooperating with automakers or battery companies jointly owned by automakers (such as Volkswagen PowerCo). Therefore, Tier 1 may play a relatively limited role in QuantumScape's commercial ecosystem. Instead, those material and equipment suppliers have close relationships with QuantumScape, such as manufacturers providing ceramic powder, coating sintering equipment, etc., which will become important partners in QuantumScape's mass production process. But these belong to the supply chain cooperation category, not the user expansion category, so they are not expanded here.

Sample Delivery and Verification Status: QuantumScape is currently fully supporting the testing and verification work of its partners. Alpha-2 prototype cells have been delivered to customers since the end of 2023, and after testing and improvement, they provided reference for B-sample design. B-sample cells (QSE-5) have been produced in small batches and shipped to customer laboratories since Q4 2024, and customers are expected to integrate them into prototype vehicles or battery packs for road testing starting in 2025. Volkswagen's tests have covered laboratory durability and safety, and may enter vehicle-level performance testing thereafter. According to Volkswagen's plan, QuantumScape technology will eventually be integrated into its **"unified battery" platform, adapting to different Volkswagen brand models. It can be foreseen that within 1-2 years, QuantumScape's batteries are expected to appear in Volkswagen's test vehicles and even small-scale demonstration fleets. This will be a key step in verifying the compatibility of its technology with vehicles. Once vehicle certification is passed and driving data is accumulated, QuantumScape can start formal mass production supply**. Other potential customers are similar, needing to go through the process of laboratory evaluation → sample vehicle testing → designated supply. Currently, QuantumScape has taken the first step and is working closely with customers to complete subsequent verification. This kind of high-sticky cooperation relationship also increases customer conversion costs and loyalty: once a manufacturer's model design is optimized around QuantumScape battery characteristics, it will tend to continue purchasing its batteries, forming a stable supply-demand relationship. Therefore, QuantumScape's current sample delivery is not only technical verification but also an important part of market expansion, and its success will determine the scale of future orders and revenue.

In summary, in terms of partner and customer expansion, QuantumScape has established a foothold with Volkswagen as a heavyweight ally and attracted more potential customers through continuous sample delivery. Volkswagen's endorsement and license agreement have established industry trust for QuantumScape, while the interest of other automakers reflects the market's urgent demand for high-performance solid-state batteries. As technology maturity improves, QuantumScape is expected to replicate this "one-on-one deep cooperation" model to more customers. In the context of highly cooperative division of labor in the new energy vehicle industry, QuantumScape is gradually building an ecosystem centered on its technology: with government and capital support above, strategic partners such as Volkswagen in the middle, and a potentially broad customer base below. This paves the way for the commercialization of its solid-state batteries.

Policy Support (U.S. New Energy Battery Policy, Subsidies, and QuantumScape's Situation)

The U.S. government has been vigorously promoting the new energy battery industry in recent years, and the domestic policy environment is quite favorable for innovative battery companies like QuantumScape.

National Strategy and Industrial Policy: The U.S. passed the "Inflation Reduction Act (IRA)" in 2022, which introduced tax credits for electric vehicle battery manufacturing and other incentives, such as providing about $35 tax credit per kilowatt-hour for batteries produced in the U.S. This means that if QuantumScape establishes battery capacity or authorized cooperation production in the U.S. in the future, it can significantly reduce production costs and enhance price competitiveness. In addition, the U.S. Department of Energy (DOE) released the "National Battery Blueprint 2021-2030," clearly listing solid-state batteries as a key R&D direction, hoping to achieve industrialization of next-generation battery technology by 2030. The DOE's Advanced Materials and Manufacturing Office specifically released a $16 million research project tender in April 2023 to strengthen solid-state battery manufacturing capabilities. The project requires national laboratories and enterprises to cooperate to solve key obstacles to solid-state battery scale production, including translating laboratory electrolyte results into large-size manufacturing, precision processing technology, process standard verification, etc. This shows that federal attention and investment in solid-state batteries are increasing. Not only that, the DOE has previously provided early R&D funding for solid-state battery startups through projects such as ARPA-E (QuantumScape received ARPA-E funding as early as 2011 to explore new electrochemical energy storage principles). Overall, the U.S. government has created a supportive environment from R&D funding, manufacturing incentives to supply chain security, encouraging companies like QuantumScape to accelerate technological breakthroughs and domestic landing.

Direct Support QuantumScape Received: So far, QuantumScape has not publicly announced receiving large federal grants or loans (unlike some peers such as Solid Power receiving DOE grants). This may be partly because QuantumScape obtained sufficient funds through listing financing (SPAC) and does not urgently need government subsidies; on the other hand, its business model is more focused on cooperation with large enterprises rather than independent factory construction, so it did not apply for DOE battery factory subsidies like traditional manufacturing projects. However, at the local level, QuantumScape has enjoyed significant policy benefits. For example, the California government's CAEATFA project has approved sales tax exemption (STE) incentives for QuantumScape's equipment investment in building the QS-0 trial production line in San Jose, with a total amount of about $114.8 million in purchase, and tax exemption value of about $10 million. QuantumScape has applied for and utilized such incentives from California multiple times since 2017 to expand R&D and production facilities. These benefits reduce QuantumScape's domestic expansion costs, reflecting state government support for cutting-edge battery projects. In addition, QuantumScape was selected for the White House "American Clean Energy Industry Makers" list in 2022, and CEO Jagdeep Singh was invited to attend clean energy meetings, indicating policy recognition of its innovative role.

Potential Grant Plans: Between 2023-2024, the DOE launched battery supply chain grant opportunities worth billions of dollars (from the "Infrastructure Act"). Among them, the $3.3 billion battery materials and battery manufacturing fund awarded more than 20 projects in the first round in 2022 (mostly materials, recycling, and traditional battery factories), and the second round application deadline is early 2024. Whether QuantumScape participated in the bidding is unknown. If it participates and wins, it may receive construction funding support worth hundreds of millions of dollars. However, since QuantumScape follows a light asset cooperation route and has not planned a giant factory itself, such manufacturing subsidies may mainly benefit its partners (such as Volkswagen's joint venture factory in the U.S.). Instead, QuantumScape is more likely to receive government support from R&D projects. For example, the DOE solid-state manufacturing project mentioned above encourages laboratory and enterprise cooperation, and it is not ruled out that QuantumScape will jointly apply with a national laboratory to obtain government technology development funding. This will help QuantumScape further solve technical bottlenecks in scale production and strengthen its connection with the DOE system.

Policy Environment Significance for QuantumScape: Overall, the U.S. government's new energy battery policy creates favorable conditions for QuantumScape: on the one hand, it is expected to enjoy production subsidies, reducing future product costs and making its solid-state batteries more competitive in the market; on the other hand, through research funding to share some technical risks and accelerate technology maturity. In addition, the government's emphasis on domestic manufacturing and supply chain security may prompt QuantumScape to retain certain production capacity in the U.S., rather than relying entirely on overseas (even with Volkswagen's cooperation factory, it can be located in the U.S.). Currently, QuantumScape already has a trial production base in San Jose, and it is not ruled out that a small-scale mass production line will be built in North America in the future to comply with IRA regulations and obtain subsidies. In terms of geopolitical competition, U.S. government support for domestic innovation also indirectly helps QuantumScape occupy an advantageous position in competition with foreign competitors (especially Chinese manufacturers). The Chinese government is also vigorously supporting the domestic solid-state battery industry (such as including solid-state batteries in technology breakthrough projects, local subsidies, etc.), but QuantumScape, due to its highly sensitive technology, is expected not to introduce investment or technology cooperation to China to avoid intellectual property loss. This may also be tacitly approved or even encouraged by U.S. policy. To some extent, QuantumScape has been regarded as a key piece in the U.S.'s competition with Asia in next-generation battery technology, and its success or failure is related to whether the U.S. can achieve leadership in high-energy-density batteries. Therefore, it can be expected that if QuantumScape needs further funding or policy assistance in the future, the U.S. government will still provide corresponding support (such as tax exemption extension, targeted procurement contracts, etc.). Although QuantumScape has not directly received federal grants, the policy tailwind is already protecting it.

Technical Barriers and Patents (Core Technical Challenges, Patent Layout, and Strategy)

Solid-state batteries are hailed as "game-changing" technology, but commercializing them still requires overcoming multiple technical barriers. QuantumScape has proposed original solutions to these key challenges during its research and development process and has built a rigorous intellectual property barrier to protect its inventions. This section evaluates QuantumScape's core technical barriers, key patents, and its patent layout strategy in the world, especially in China and the U.S.

1. Core Technical Barriers: QuantumScape's core innovation lies in a ceramic solid-state electrolyte separator, which makes the safe cycling of lithium metal anodes possible. Although lithium metal anodes have extremely high specific capacity, they are prone to forming dendrites that pierce the separator and fail in traditional liquid batteries. QuantumScape achieves inhibition and isolation of lithium dendrites through a proprietary ceramic separator formula, while possessing good ionic conductivity and mechanical strength. This solves the contradiction of "ionic conductivity vs. dendrite isolation" in solid-state batteries and is regarded as QuantumScape's core technical breakthrough.

However, there are still multiple technical barriers surrounding this core that need to be overcome:

Solid-state Electrolyte Material Performance: QuantumScape mainly uses oxide-based ceramics (externally speculated to be doped garnet structureLLZO or similar materials) as electrolytes. Oxide solid-state electrolytes have high room temperature ionic conductivity (up to 10^-3 S/cm level) and a wide electrochemical stability window, stable for high nickel cathodes. However, its disadvantages include high interface resistance when directly contacting metal lithium, and sensitivity to humidity, high sintering temperature, etc. QuantumScape improves the ionic conductivity and interface affinity of ceramic electrolytes through element doping and process optimization, while manufacturing in a strictly anhydrous and oxygen-free environment to overcome the problem of oxides reacting with moisture. In addition, the company has also researched composite solid-state electrolytes, such as introducing organic polymer components into ceramics to balance mechanical strength and interface wetting. Its patents show that QuantumScape has also laid out multiple solid-state electrolytes, such as perovskite (anti-perovskite), thio-LISICON (sulfide), and even hydride. This indicates that the company fully recognizes the importance of material system diversification to ensure finding the best solution in terms of performance and manufacturability.

Interface and Electrode Design: Another major challenge of solid-state batteries is solid-solid interface impedance. Without liquid wetting, poor contact between the cathode and solid-state electrolyte can significantly reduce capacity utilization. QuantumScape improves the interface through the "catholyte" solution, adding a small amount of liquid/gel electrolyte to the cathode coating to form a composite interface between the solid-state separator and cathode particles, thus balancing the safety advantage of the solid-state separator on the anode side and the interface ionic conduction on the cathode side. This design is reflected in QuantumScape's patents: they propose a low porosity solid-state cathode, internally mixed with ionic conductors, conductive agents, and binders. This invention reduces interface voids, lowers internal resistance, and has been patented in multiple countries including the U.S., China, and Europe. In addition, to further reduce interface impedance, QuantumScape's charging and discharging strategy has also been optimized. For example, its patent proposes a pulse lithium plating method to uniformly deposit lithium metal and avoid concentrated dendrite growth. These technologies collectively overcome the interface challenges between lithium metal anodes and solid-state electrolytes, as well as between solid-state electrolytes and cathodes, ensuring stable battery operation from materials, structure to operation.

Manufacturing Process and Scale-up: Even if material and design issues are resolved, solid-state batteries need to overcome process bottlenecks for large-scale production. QuantumScape identifies key links including: batch preparation of ceramic separators, multi-layer cell lamination packaging, and overall production rhythm improvement. As mentioned earlier, the company has developed Raptor and Cobra continuous flow processes to achieve roll-to-roll rapid sintering of ceramic separators. In addition, QuantumScape's patents also cover solid-state battery manufacturing methods, such as how to prepare separators in thin film form, how to ensure alignment and interface quality during multi-layer stacking, etc. Its strategy is to continuously improve process parameters during the trial production stage and invest in specialized equipment to solve capacity and consistency issues. The introduction of Cobra equipment in 2024 is a major breakthrough in QuantumScape's manufacturing process. But even so, large-scale mass production still faces challenges such as consistency of powder raw materials, sintering yield, precision of stacking packaging. Especially in batch preparation of ceramic separators, small defects can lead to a decrease in yield, requiring strict process control and quality inspection. QuantumScape is ramping up through automation and engineering experience accumulation to gradually approach the manufacturing efficiency of traditional lithium batteries. It can be said that manufacturing process barriers are both QuantumScape's current challenge point and its core competitive threshold—first-mover companies often have a deeper understanding of process problems and can maintain leadership through patents and know-how.

Comprehensive Balance: Finally, there is a macro barrier of balancing performance and cost. Solid-state batteries may achieve extreme single-item performance in the laboratory, but commercialization must comprehensively consider energy density, cycle life, safety, low-temperature performance, and cost. QuantumScape's choice is to prioritize solving "must-have" indicators: for example, safety and cycle life are placed first because they are the bottom line of commercial batteries; on this basis, energy density and fast charging are improved as competitive advantages, while gradually reducing costs through process innovation. QuantumScape has already proven that it can achieve high specific energy and fast charging without sacrificing lifespan safety, which largely establishes its technical feasibility. The next step is for the company to bring unit cost to a reasonable range. According to estimates, QuantumScape's initial battery cost will be higher than traditional lithium batteries, but with process improvements such as Cobra, unit costs are expected to decrease as production increases. If policy subsidies (such as IRA $35 per kWh) are included, the initial cost disadvantage of solid-state batteries can be partially offset. Overall, QuantumScape's technical route shows the idea of: gradually breaking through key barriers, forming a performance combination, and then driving cost down through engineering efforts and scale effects. This is different from some research that only pursues breakthroughs in a single indicator, and is also reflected in the comprehensiveness of its patent layout.

2. Patent Layout and Intellectual Property Strategy: QuantumScape attaches great importance to using patents to protect its technology and has established a global patent portfolio. As of the end of 2020, QuantumScape has 67 patent families (i.e., the same invention applied in multiple countries), including more than 80 authorized patents and more than 100 pending patents. These patents are mainly distributed in the U.S. (as the original place) and Europe, with more authorizations in the U.S. and Europe. In Asia, QuantumScape has few authorized patents but many pending applications, showing its willingness to strengthen patent layout in Asia (especially China, Japan, South Korea). According to the well-known intellectual property analysis agency Knowmade, QuantumScape currently has only a few effective patents in China, but the number of disclosed applications is considerable, indicating that the company is actively seeking to establish IP barriers in key markets such as China. This forward-looking layout is very important because China is one of the largest potential markets for solid-state batteries in the future and the region with the most competing companies.

QuantumScape's patent content covers all aspects of the solid-state battery industry chain. Specifically, it includes:

**Electrolyte Material Patents:** Covering inorganic solid-state electrolytes (such as doped garnet oxides), inorganic-polymer composite electrolytes, sulfide electrolytes, anti-perovskite electrolytes, etc. For example, QuantumScape has patents involving anti-perovskite (Li_3OX type) and hydride solid-state electrolyte preparation, and even the popular Thio-LISICON sulfide (Li_3PS_4 system). These material patents ensure that regardless of which material system wins in the future, QuantumScape holds certain technical reserves and exclusivity.

Separator/Electrode Manufacturing Patents: Including ceramic separator sintering methods, coating on support membranes, thin film electrode manufacturing, solid-state laminated battery assembly processes, etc. QuantumScape even acquired some chemical bath deposition thin film patents through the acquisition of early company Sisom Thin Films to improve separator manufacturing capabilities. These process patents provide legal weapons for QuantumScape to establish process barriers, preventing competitors from easily copying its production processes.

Battery Structure and Operation Patents: Such as the aforementioned low porosity cathode patent, pulse lithium deposition patent, solid-state battery internal component design, etc. These patents directly target methods for improving battery performance and are laid out in multiple countries (for example, the solid-state cathode patent has applications/authorizations in the U.S., China, Europe, Japan, South Korea, etc.). This ensures that QuantumScape occupies the initiative in core battery design, and competitors adopting similar designs may face infringement risks.

It is worth mentioning that although Volkswagen and QuantumScape cooperate closely, the two parties do not have jointly signed patents. Volkswagen mainly obtains technology usage rights through investment and agreements, while QuantumScape independently holds patent rights. This protects QuantumScape's long-term value as a technology supplier. On the other hand, according to analysis, Toyota, Bosch, LG Chem, and other patent giants in the solid-state battery field have cited QuantumScape's patents multiple times in their patent applications as existing technology. This indicates that QuantumScape's inventions have attracted high attention from peers and are regarded as important references. Once patent litigation occurs in the future, these citations may become strong prior innovation evidence.

In terms of China-U.S. patent strategy, QuantumScape clearly recognizes the importance of the Chinese market. Although it currently has few authorized patents in China, some patents such as the aforementioned cathode design have been approved in China. As more applications enter substantive examination in the future, the number of QuantumScape's patents in China is expected to rise. This is meaningful for preventing potential infringement and negotiating cross-licensing. Of course, Chinese companies are also applying for a large number of solid-state battery patents (CATL, BYD, Qingtao, etc. have many applications). Japan's Toyota leads globally in solid-state battery patents (over 1300). QuantumScape needs to continue investing in R&D to maintain the novelty and breadth of its patents, avoiding being surrounded or bypassed by competitors. Meanwhile, QuantumScape may adopt a "do something, do not do something" strategy: strictly protect its core technology (such as ceramic separator formula and preparation process), while choosing to publish or loosely authorize non-core areas to promote industry standards to develop in a direction favorable to itself. This strategy is common among high-tech companies and is used to balance patent defense and industry collaboration.

Another strategic factor is export control and technology protection. As a U.S. advanced battery technology company, it must comply with U.S. restrictions on the export of key technologies (solid-state batteries may be regarded as strategic energy technology). QuantumScape currently has no plans to build factories or transfer technology in China, and its cooperation production line with Volkswagen is expected to first land in Europe and the U.S. In the long run, if QuantumScape's batteries are to enter the Chinese market, it may adopt licensing cooperation with large Chinese companies or indirectly supply through vehicle imports, rather than rashly producing in China to avoid IP loss. In this situation, QuantumScape's patents in China more play the role of a defensive shield—preventing Chinese companies from applying for patents with the same technology as QuantumScape in China and occupying the market. In the U.S., QuantumScape's patent portfolio is already quite solid, covering all aspects from materials to systems, giving it freedom to implement and exclusivity in North America. In summary, through more than ten years of patent accumulation, QuantumScape has built a moat around ceramic solid-state batteries. This intellectual property barrier will help it take the initiative in competition with competitors (including latecomers and international giants). If competitors try to directly copy QuantumScape's solutions, they are likely to face patent challenges; even if they take different routes, QuantumScape's extensive layout increases the possibility of them stepping on mines.

Summary: QuantumScape has established leading advantages in both technology and patents: technically, the company has overcome the three major difficulties of solid-state battery materials, interfaces, and processes, showing all-round excellent performance; in terms of patents, the wide coverage and multi-level layout ensure innovation results and support its business model. In the future commercialization process, QuantumScape still needs to continue solving mass production engineering problems (such as reducing separator costs, increasing output) and differentiation from competitors. But with the existing technical depth and IP barriers, QuantumScape is expected to occupy a place in the wave of solid-state battery industrialization and lead the industry to a higher level of development.

Reference:

QuantumScape QSE-5 B-sample cell specifications (5Ah capacity, energy density 844 Wh/L)

Volkswagen Group PowerCo measured QuantumScape 24-layer battery cycle 1000 times with 95% capacity

QuantumScape completed four major technical goals in 2024 (Alpha-2 sample, B-sample trial production, Raptor/Cobra process)

QuantumScape Cobra separator process put into use, increasing separator heat treatment speed by 25 times

CATL expects to achieve small batch production of all-solid-state batteries in 2027; BYD, Gotion, and other solid-state battery mass production timelines

Ganfeng Lithium started mass production of 260 Wh/kg mixed solid-state batteries in 2023, planning full-solid-state vehicle installation around 2027

Nio 150 kWh semi-solid battery pack (provided by WeLion) energy density 360 Wh/kg, started vehicle trial operation in 2023

QuantumScape's core patents revolve around ceramic solid-state electrolyte separators and lithium metal anode-free design; patent layout mainly in the U.S. and Europe, followed by Asia

QuantumScape's cathode design patent (low porosity solid-state cathode) has been authorized in the U.S., China, and Europe, solving interface impedance issues

The U.S. Department of Energy lists solid-state batteries as a key support area, funding to solve key obstacles to scale manufacturing