3 Reasons to Buy QuantumScape, and 1 Reason to Sell | The Motley Fool

Major companies, from automakers to parts suppliers, are working hard to meet the growing demand for electric vehicles (EVs). At the same time, companies are continually improving their electric vehicle offerings in terms of performance, range on a single charge, and cost.

solid-state battery technology company quantumscape (qs 8.11%) is working on batteries that will help electric vehicles travel longer distances on a single charge and take less time to recharge, and will cost less than batteries. currently in use. obviously there is a lot of interest in how the company is progressing. let’s look at quantumscape’s progress and plans, and discuss whether the action is a buy.

Reading: Is quantumscape stock a good buy

progressing well on his plans

In its latest quarterly results released last month, quantumscape updated investors on its progress. the company has obtained encouraging results for its 16-layer cells. cells for use in automotive applications require several dozen layers, and quantumscape is progressively increasing the layers to test energy retention and cycling with each addition. furthermore, it relies on increasing the layers without materially affecting the performance of the cells.

In the first quarter, one of their automotive customers successfully tested quantumscape’s 10-layer cells. quantumscape aims to deliver its initial sample cells with dozens of layers to at least one customer by 2022. the company’s progress is one of the main reasons to buy its stock.

shorter charging time, longer range

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Another reason to buy quantumscape stock is the company’s solid-state battery technology, which could be a game changer in the electric vehicle industry.

Batteries currently available on the market must trade off between energy density and power. So an EV that uses a battery with high energy density can last longer on a single charge, but it takes longer to charge. This is represented by the “Best Selling Long Range EV” dot on the chart above. Although this battery has a high energy density of more than 700 wh/l (watt-hours per liter), it takes around 35 minutes to charge from 10% to 80%.

Alternatively, batteries may charge faster, but will have a lower energy density, meaning the vehicle will travel less distance on a single charge. this is shown as “high performance leading ev” on the graph.

quantumscape projects that its solid-state lithium metal batteries will have a much higher energy density and much shorter recharge time than battery options available on the market today. Additionally, Quantumscape cells are anodeless, helping them to be more cost effective than conventional batteries with anodes.

high interest from potential buyers

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Clearly, the promising technology has received a great deal of interest from potential buyers, including major automakers. quantumscape has partnered with three of the world’s top 10 automakers by revenue. The third partnership was announced in March and could potentially lead to a joint venture facility with up to 50 GWh (gigawatt-hours) in annual cell production capacity.

While these partnerships depend on quantumscape successfully meeting its technical goals, what they do is provide the company with ready buyers once it meets agreed milestones.

a challenging task

Overall, quantumscape is making good progress with its plans to develop next-generation batteries. has great interest from potential buyers of its cells.

However, it is important to note that solid-state batteries have been researched for years, but companies have not been able to successfully commercialize them until now. That’s because there are several engineering and technical hurdles in its development.

quantumscape seems to be making good progress, but whether or not it succeeds in commercializing the technology remains to be seen. the company expects to produce sample cells for sale to customers by 2024-2025. Until it does, however, investing in stocks is an endeavor suitable only for investors with an abundant appetite for risk.

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