QuantumScape CEO on going public through a SPAC deal

Jagdeep Singh, QuantumScape Founder & CEO, joined Yahoo Finance to discuss going public through a SPAC deal and the future of electric vehicles.

Video Transcript

ADAM SHAPIRO: We love to talk about electric vehicles. Sometimes we get to talk about the thing that makes those vehicles move. And that would be the battery. Let's bring into the stream right now Jagdeep Singh. He is the founder and CEO of QuantumScape, a company that is about to go public, and you're going to be able to get a share of this if you so desire.

But first and foremost, thank you. Also, I want to let everyone know that Ines Ferre is here as well because she has some questions about the company. But in general, the batteries that you're making, they're different than, say, the batteries you might get today in an electrical vehicle. Can you help those of us who are non engineers understand what it is you're producing?

JAGDEEP SINGH: Absolutely not, and that's a great question. So today's batteries are all based on what's known as a liquid electrolyte. And without getting too technical, that's the medium through which lithium ions move up and down in the battery. So lithium ions go from the cathode to the anode and back when you're cycling the cell. And that liquid has a number of issues with it. It's flammable. It results in a lower energy density. It results in a slow rate of charge for charging purposes.

And what we do is we basically replaced that liquid with an entirely solid material, known as a solid state electrolyte. And by doing that, we can basically get higher energy density, so more range for a given charge, faster charge times, a 15-minute charge instead of, say, an hour at best, and safer operation because the material itself is non-flammable.

So it's a fundamentally different kind of battery. It's been kind of a holy grail for since the mid '70s, actually. But no one's been able to make a material that has met the requirements until now. And, you know, it's taken us 10 years of work. But now that we have the material, we're really excited, as are our customers, our automotive OEM customers. And we think this really does have-- present an opportunity to transform the other sector.

INES FERRE: Jagdeep, Ines here. Volkswagen is aiming to put your solid state batteries in their vehicles by 2025. What do you say to investors that are contemplating whether to come into this trade or not, given the timeline, and especially also given the run-up that we've seen in the EV space?

JAGDEEP SINGH: Yeah, and I think at the end of the day, the way we think about the sector is, you know, there are 100 million cars sold every year. Only about 2% of them are electrified today, which means 98% are not. That's about 98 million vehicles every year. If they were all electrified, that would be a market of around half a trillion dollars per year.

So this is about as big as markets get. And we're really at the cusp. We're at the beginning of this massive transformation. Whoever wins the battery battle, so to speak, is going to be looking at, in our opinion, a multi-hundred billion dollar company.

So we think that solid state technology is the technology that's best poised to win this battle over the long run. So I wouldn't really look at a QuantumScape as, you know, as something that's kind of a short-term play. This is really a play that we believe, over the next few decades, could fundamentally transform the automotive sector. So that's kind of the way I would look at this in terms of as an investment.

SEANA SMITH: You talk about fundamentally transforming the auto sector, winning this battle here. What about price point? I guess, what's the price point you need to get to, to achieve that kind of commercial success that you're looking for?

JAGDEEP SINGH: Yes, so, you know, today's batteries are, you know, getting close to roughly $100 per kilowatt hour as a price point. The beauty of this approach is that not only do you get what's almost a better performance in terms of energy density or range, as well as a charge times and safety, but you do that for a lower cost because you eliminate one of the key components of the conventional battery, which is the anode.

So in a solid state battery, there is no anode. There is no carbon at all. And that elimination of both the material and the manufacturing costs associated with that anode results in getting those benefits, while still having a lower cost of goods sold than any conventional battery. So we agree that battery costs have to come down, as one of the key enablers to penetrate the mainstream market. And we think solid state really is the industry's best bet to deliver that economic advantage.

INES FERRE: You also mentioned charge time. I know that you have this fast charge time of 15 minutes. Can you talk to us a little bit about how that will change the game for batteries? And do you see other technologies, other companies, being able to match that by the time that your batteries are in production?

JAGDEEP SINGH: Yeah, so we think that charge times are a really important requirement. So the reason why today's EV penetration stands at 2% instead of at 20% or 80%, we believe, is because today's batteries just aren't competitive with the combustion engine.

And that's, at the end of the day, what we're competing with. It's a combustion engine, not other batteries. Combustion engines don't take an hour to charge. You know, it takes maybe 5, 10 minutes to refuel your car at a gas station. And so, we see this 15-minute charge as a step closer to combustion engines.

And so, yeah, we think that's a really important factor that will accelerate adoption of EVs across the board, as is energy density, as I mentioned. You want to be able to get, you know, a comparable level of driving range to combustion engine-based vehicles with battery-powered vehicles. And we think that the 300 to 500-mile range per charge is going to be what would get you there.

So at the end of the day, I think that the benefits, the combined benefits of greater range on a single charge, being able to charge in a time that's closer to what combustion engines require and increased safety are the elements that will enable broader penetration of EVs into the overall market.

ADAM SHAPIRO: So if I'm hearing this correctly, smaller battery, lighter battery, faster charge, range of minimum 300 miles per hour. Is the design right now the configuration one that's interchangeable with different kinds of vehicles? Or does that still have to get shrunk down?

JAGDEEP SINGH: Yeah, Adam, so the way it works is that we make a cell, a battery cell, which is about the size of a deck of cards. That will be the final form factor that we ship to customers. And then what the automotive OEM does is assemble those decks of cards, if you will, into modules and packs that split their particular design. So a long range EV, for example, might have more of those cells stacked up into a rectangular array under the floorboard. And a CSC vehicle might have a smaller number of vehicles.

But from our standpoint, it's the same exact building block, which simplifies our manufacturing process. And also the customer's job relative to configuring that into the vehicle.

ADAM SHAPIRO: Jagdeep Singh is QuantumScape founder and CEO. We wish you all the best and continued success with QuantumScape.