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Property Risk Management Considerations for Electric Vehicle Manufacturers

Li-Ion batteries are an emerging risk for the auto industry. Fire tests are conducted to formulate protection schemes for storage and battery manufacturing processes.

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The increasing popularity and widespread adoption of Lithium-Ion batteries in various applications have revolutionized our modern society. Current production of battery cells is more than 1 billion units each year with expected annual growth of 25%. 13 new gigafactories are planned to be online by 2025 in the United States alone. The superior energy density and longer lifespan offered by these batteries have made them the perfect choice for powering our devices and vehicles. However, along with the numerous benefits, Lithium-Ion poses inherent fire hazards if not manufactured and handled properly. The safe handling of these batteries is required to mitigate potential hazards such as thermal runaway, fire, leakage, and explosion. Understanding the best practices and fire protection strategies will reduce this exposure. As technologies improve, the risk will likely improve due to safer materials and processes being used. Arguably, the automotive industry has seen the greatest impact of Lithium-Ion batteries. The percentage of Electric Vehicle (EV) new sales is growing each year. Major auto brands are both converting existing Internal Combustion Engine (ICE) assembly plants to EV plants, and launching greenfield sites dedicated to EV production and battery manufacturing. Numerous new EV companies have been launched, also.

Despite the fact Li-Ion batteries have been used in the auto industry for years, this is an emerging and evolving risk for the auto industry. Full-scale fire tests are being conducted to understand the fire characteristics to formulate protection schemes for storage and battery manufacturing processes. Careful planning for ICE plant conversions and new facility construction are necessary to reduce, mitigate or avoid the potential fire hazards.