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QuantumScape CEO shares two exciting developments in the works

Jagdeep Singh, QuantumScape CEO, joins Yahoo Finance Live to discuss the company’s development on EV batteries and its outlook for the remainder of the year.

Video Transcript

JULIE HYMAN: Well, with electric vehicle stocks and companies red hot right now, the quest to find and build a solid state battery is also fairly urgent. Essentially, this is a battery that would hold its charge better than the batteries that are on the market currently. And really, at the forefront of that is QuantumScape. The CEO, Jagdeep Singh, is joining us now. But now, you guys just reported your earnings recently. But you also talked about a potential breakthrough when it comes to these batteries. And it has to do with ceramic. Can you talk us through this development and what it means and how far you still have to go, then, in the development of the battery?

JAGDEEP SINGH: Sure, Julie. So you'll recall that in December, we announced the performance results of our first single layer cells, which were sort of record breaking results. And the first time in 45 years that somebody had shown a solid state cell that was capable of performing under uncompromised test conditions, so high rates of power, long cycle lives, unelevated temperatures, all of course, with the capability to have a very high energy density or range.

And I think the big question back then was, this is great. This is a breakthrough. But can these guys take that single layer cell and make a multilayer cell out of that? Because the commercially shipping cell will be a multilayer cell.

And I think what we were really pleased to see, as we reported last week in our earnings call, that we, in fact, had taken four layers and stacked them up together to make a four-layer cell. And the performance of that four-layer cell was essentially indistinguishable from the performance of our single-layer cells. The multilayer stacking process didn't adversely impact the performance in terms of capacity retention, cycle life, and so on.

And that was the big breakthrough because what that means is that we can now continue to scale this technology. Later on this year, we hope to have an eight to 10-layer cell. And if we hit that milestone, then we'll be on track to deliver actual sample cells to our automotive OEMs. So that was a pretty big deal.

You also asked what remains to be done. And one of the things that remains to be done is to scale up our production capability to manufacture these cells. And so we also announced last week that we are setting up a pre-pallet facility to manufacture these cells right here in California. And that facility, we're actually in the middle of procuring space as we speak. That'll be producing cells in 2023.

And we'll put on the order of 100,000 cells in that factory, which will be enough to actually get cars on real test tracks with these cells. So by 2023, we'll actually have cars running on solid state batteries. They won't be purchasable in the dealerships. But there will be demonstrations of the core technology. So those are the two really exciting developments that we reported on last week.

BRIAN SOZZI: Jagdeep, that sounds very important, what you just mentioned, eight to 10 cells by the second half of this year. I think a lot of folks are still getting to understand your company. And you've had, really, some big developments in many respects that come out of left field or come out of the blue.

You wake up one morning. And you see, wow, the stock's up so much. When do you expect to reach that eight-layer cell? What's the date? Is there some timeline you can provide?

JAGDEEP SINGH: Yeah, the eight to 10-layer cell, we think, is going to happen by year end. So we don't want to set expectations too high. I mean, we've been fortunate so far that the goals we've set, we've been able to meet, the single-layer cell announcement, this multilayer statement was, I think, ahead of what anybody was expecting. But I think the eight to 10-layer cell, we're targeting by year end.

The key point is, if we make that year end milestone, then we're on track to delivering sample cells to customers in 2022. And if we can get our production facility running, then we'll actually have enough cells to build actual cars, as I mentioned, in 2023. So if we hit the goals for this year, we're tracking to our longer-term goals, which we've already shared with the Street.

BRIAN SOZZI: Jagdeep, I did sense on your earnings call a little while more recently, an openness to working with other OEMs outside of Volkswagen. Who are you in talks with?

JAGDEEP SINGH: Yes, so we haven't reported who we're in talks with. But we have said that more than one automotive OEM has tested our cell successfully. So the traction, to be honest with you, the interest we're seeing is just pretty phenomenal.

As you might expect, a battery that delivers higher energy density for a longer range and faster charging in 15 minutes, safer operations is going to be of interest to a lot of players. But we're seeing it not just from the automotive OEMs but also other sectors. So clearly, things like stationary storage for the grid, that's a really important application for batteries. Obviously, consumer electronics, everybody would like long-lasting phones and laptops and so on. And even VTOL applications, vertical take off and landing electric aircraft.

So this kind of battery is going to have a really wide applicability across the different sectors. Our key challenge is to be able to actually manufacture enough of them to meet all that demand. So for now, we're trying to stay pretty focused. We don't want to get too distracted.

Obviously, we have this big commitment to Volkswagen. They have been a great partner. We love these guys. And so we want to deliver what we've committed to them. But they understand that's a non-exclusive partnership. They do have the right to be first. And we will obviously honor that. But they recognize that we are going to be working with OEMs and other sectors in the fullness of time.

JULIE HYMAN: Jagdeep, it's great to catch up with you. Thanks so much for being here once again. Jagdeep Singh is the CEO of QuantumScape. And of course, we'll be checking in with you frequently as we follow this really fascinating race when it comes to electric vehicles. Thank you.

JAGDEEP SINGH: Always a pleasure, Julie. Thank you.

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