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When leading the company from 0 to 1 and moving towards 1 to 100, Yu Huigen realized that organizational strength became particularly important.

Text｜"Chinese Entrepreneurs" reporter Ren Yafei

Editor: Ma Jiying

Photo by Deng Pan

When he decided to start his own business, Yu Huigen was nearly fifty years old.

At that time, he was the chief engineer of BAIC New Energy, with a good position, salary and benefits. Many relatives and friends around him did not understand his decision to start a business, and some people dissuaded him. But Yu Huigen believed that "if I don't do this, I will regret it in my life" and "I must build a listed company."

In August 2016, Yu Huigen took on a new role: founder, chairman and general manager of Weilan New Energy, a company that focuses on the research and development and production of solid-state batteries.

In the eight years since its establishment, WeiLan New Energy has completed multiple rounds of financing. Investors include NIO, Geely, Huawei, Xiaomi, Tianqi Lithium and other automobile companies and participants in the automotive industry chain. Its current valuation exceeds 15.7 billion yuan.

In the field of power batteries, solid-state batteries are considered to be the "ultimate battery" that can balance energy density, safety, cost, etc. CICC's research report believes that semi-solid and solid-state batteries are expected to become the main theme throughout this year, and 2024 will be the first year for semi-solid and solid-state batteries to be installed in vehicles.

At the same time, solid-state batteries are on the policy frontier. In May this year, China Daily reported that China may invest about 6 billion yuan in the research and development of all-solid-state batteries, and six companies including CATL, BYD, FAW, SAIC, Weilan New Energy and Geely may receive government basic research and development support.

It is understood that Weilan New Energy has currently applied for more than 580 patents and is a solid-state battery company that is simultaneously undertaking multiple national key R&D projects (in the fields of energy storage and automobiles).

In the solid-state battery field, from traditional liquid battery giants to start-ups, all hope to replicate the success of previous companies in the liquid battery field. Can Weilan New Energy take off this time?

Choose a technical route

In 2015, Yu Huigen was still working at BAIC New Energy, mainly researching the technical route of power batteries, and also served as a graduate tutor at the Institute of Physics of the Chinese Academy of Sciences. During this period, he often met with his college classmate Li Hong, and both of them were interested in solid-state batteries, and gradually the idea of ​​​​starting a business emerged.

At the end of 2015, an investor approached Yu Huigen and said that if he wanted to start a business, he could invest 20 million yuan.Although the money never arrived, it allowed Yu Huigen to see the enthusiasm of the capital market.

In August 2016, Yu Huigen brought together Li Hong and Academician Chen Liquan to establish Weilan New Energy, which is engaged in the research and development of solid-state lithium batteries, with Yu Huigen as chairman.

Yu Huigen recalled that the most difficult thing in the early stages of the business was to find and determine the technical development route for solid-state batteries.

According to the difference of electrolyte materials, there are three technical routes for solid-state batteries: polymer, sulfide and oxide. Each of them has its own advantages and disadvantages. The advantage of polymer is low cost and easy processing, but as an electrolyte material, the conductivity is low. The advantage of sulfide is high conductivity, but it is difficult to prepare and expensive. China is betting more on the oxide technical route.

It is precisely because domestic companies choose the oxide technology route more often that there is a "gray" area between liquid batteries and all-solid-state batteries, namely semi-solid-state batteries. According to the content of the electrolyte, batteries can be divided into liquid, solid-liquid mixed, and all-solid. Therefore, the transition from liquid batteries to all-solid-state batteries is a gradual process. What Weilan New Energy can do is to gradually reduce the content of the electrolyte.

"Our original intention was to make solid-state batteries, but we were completely confused about how to do it. At that time, we felt that we had a goal and a clear starting point, but we didn't know the path. We could only repeatedly discuss and prove it, and continue to try and error. This was inefficient and required a lot of investment." Yu Huigen said that later Li Hong proposed to make a hybrid solid-state or semi-solid-state product.After two years of groping in the dark, they finally confirmed their current technical route in 2018.

Weilan New Energy adopts an in-situ solidification solution to turn part of the liquid into solid, so that better contact can be achieved between the electrode and the electrolyte. This is the core difference of the hybrid solid-liquid battery.

At the beginning, the entire industry believed that semi-solid batteries were a transitional product and could not be mass-produced. But in Yu Huigen's view, "the semi-solid route is the best solution to achieve mass production in the short term."

In April this year, Wan Gang, Chairman of the China Association for Science and Technology, visited Weilan New Energy for research and pointed out that "semi-solid-state batteries are a step towards all-solid-state batteries. If you want to jump over the step directly, can you? Of course you can, but the step is very high and it is very difficult to jump over it." This inspired Yu Huigen. He believes that users only care about whether the battery is safe, easy to use and cheap, and at present, semi-solid-state batteries can solve user pain points very well.

Once the technical route is confirmed, it is a long process of R&D, design and production. Due to the large scale of capital investment, long R&D input-output cycle and high technical barriers, power batteries have become an industry with a high moat.

Solid-state batteries have a longer R&D cycle. "First, the battery cell research and development cycle is generally about two years. Secondly, after the battery cell is developed, it must be adapted to the vehicle manufacturer. After the car company gets the battery cell, it takes about 18 months from the beginning of verification to mass production and installation for domestic car manufacturers, and about 3 years for foreign car manufacturers. If it is developed at the same time as the vehicle on the same platform, 3 years may not be enough. For us, it will take at least 5 years, or at most 3.5 years, to realize the commercialization of solid-state batteries." Yu Huigen said.

This also poses revenue challenges for the startup."If I only make power batteries, what will happen to the revenue during this period? How can I explain this to my shareholders and employees?"

In order to keep the company alive, Weilan New Energy made many attempts in the early days of its establishment - it made mobile phone batteries and Bluetooth headset batteries. After communicating with brands such as Huawei, Xiaomi, OPPO, and vivo, Yu Huigen found that the concentration of consumer batteries was very high and it was difficult to squeeze in. After sorting out the main business of power batteries, Yu Huigen cut off many businesses. "I felt so sad at the time. I felt that this business was already doing well and I spent so much effort, but I had to cut it off."

At present, Weilan New Energy focuses on developing solid-state power batteries, energy storage batteries and small power battery cell technologies, with applications covering new energy vehicles and ships, large-scale energy storage and other industries. It has four major production bases in Fangshan, Beijing, Liyang, Jiangsu, Huzhou, Zhejiang, and Zibo, Shandong. Yu Huigen revealed that with the increase in the production of power batteries and energy storage batteries, the company's revenue will double this year.

also,As a founder, when leading the company from 0 to 1 and then from 1 to 100, Yu Huigen also realized that organizational strength became particularly important.How to make rational decisions, prevent distortions in execution to the greatest extent possible, and maximize organizational and management efficiency are all core issues that require continuous iteration.

Challenges of mass production

In January 2021, Li Bin, founder, chairman and CEO of NIO, released the first flagship sedan ET7 at NIO Day, saying that the car will be equipped with a 150kWh semi-solid-state battery with an energy density of up to 360Wh/kg, which can achieve a range of 1,000 kilometers. As a result, the still non-mainstream solid-state battery has become the focus of heated discussion in the industry. Weilan New Energy has also become more well-known.

WeiLan New Energy has few public clients, the largest of which is NIO.

The cooperation with NIO was full of coincidences. Yu Huigen recalled that at that time, NIO wanted to extend the range of electric vehicles to more than 1,000 kilometers. After evaluating and calculating the performance indicators of the battery, it was believed that the battery capacity must reach at least 150 kWh and the energy density must exceed 300Wh/kg. It is generally believed in the industry that the upper limit of the energy density of liquid lithium batteries is 300Wh/kg, while solid-state batteries can break through this limit and achieve a higher mileage with the same battery volume. This is even more important for NIO cars that adopt the battery swap mode. Large-scale battery swapping requires the battery size to remain consistent.

But at that time, there were not many power battery companies that NIO could choose from. "Some did not recommend them to do it, and some were unwilling to cooperate," said Yu Huigen.

At the beginning of 2020, Weilan New Energy's solid-state lithium battery project was selected as one of the "Technology R&D and Achievement Transformation Projects to be Supported" for disruptive innovation in Zhongguancun. The energy density of the battery reached 350Wh/kg, which attracted the attention and attention of NIO. In 2020, Zeng Shizhe, Vice President of NIO's Battery System, met with Yu Huigen in Shanghai for several talks, and the two sides soon reached a cooperation agreement.

The next step is site selection. Yu Huigen recalled that throughout the first half of 2021, they selected sites in many places and finally decided to produce automotive power batteries at the Huzhou base. In October 2021, the Huzhou base started construction and was fully completed and put into production in June 2022.

Due to high costs and long testing cycles, Weilan New Energy faces many challenges in implementing solid-state batteries in vehicles.

"We had no experience in mass production of solid-state batteries, and the material system, team, and equipment were all new, so we had no idea where to start," said Yu Huigen. The general manager in charge of implementing the project in Huzhou was at a loss and often complained to him. For this reason, Yu Huigen went to the base to do ideological work, and he emphasized six words: seriousness, study, and persistence.

Weilai also provided strong support. "This was a joint development project, and they invested a lot of manpower, material and financial resources, and sent more than 100 people to the site." Yu Huigen recalled that after about half a year, there were fewer problems, and everyone became more and more confident in mass production and delivery.

At the end of November 2022, the automotive-grade solid-state power battery cells of the Huzhou base officially rolled off the production line. In June 2023, Weilan New Energy announced that it would deliver 360Wh/kg lithium battery cells to NIO. In December of the same year, the 150kWh ultra-long-range battery pack passed the test in Li Bin's live broadcast. On April 3, 2024, NIO announced that the battery pack has officially entered the mass production stage, and the first 150kWh mass-produced battery pack has officially rolled off the production line. The battery pack was put into use in June this year.

At present, NIO's strategy for the battery pack is "only lease, no sale". NIO co-founder and president Qin Lihong once explained that this is mainly because "the cost of the 150-degree battery pack is very high, equivalent to the price of an ET5 vehicle (the 75kWh battery version is priced at 298,000 yuan and the lease price is 228,000 yuan)".

NIO adopts a battery swap model and is relatively insensitive to battery costs. But for other car companies, battery costs are directly reflected in the selling price. Currently, the cost of semi-solid batteries is almost twice that of liquid batteries, which is also the main reason why semi-solid batteries have not been able to enter the market on a large scale.

Yu Huigen revealed that this year the cost gap between it and ternary batteries can be controlled within 10%.In the future, as production increases, especially as the cost of cathode materials decreases, the overall cost of semi-solid power batteries will be on par with that of liquid batteries. At that time, installing semi-solid batteries will become a cost-reduction option for automakers. Yu Huigen predicts that after the industrialization of all-solid-state batteries, the cost will be 10% to 20% lower than that of liquid ternary lithium batteries.

Large-scale mass production also helps reduce costs. Yu Huigen said frankly that only with sufficient production capacity can they have greater bargaining power when negotiating with upstream companies, and at the same time can they meet the needs of more car companies. As for when the turning point will come, Yu Huigen believes that the real outbreak may be in 2026, when more car companies will be equipped with Weilan New Energy's semi-solid batteries. It is understood that Weilan New Energy will reach cooperation with three car companies this year.

At present, the top priority for Weilan New Energy is still to go all out to ensure the supply of NIO.

"At present, production capacity is still in the climbing stage. With limited production capacity, we must take small steps and move fast. First, ensure that the products are delivered to NIO, and then gradually expand the scale. We have reached cooperation with three or four car companies, first solved the process from 0 to 1, and then relied on scale to reduce costs and realize the process from 1 to N." Yu Huigen said.