Development background and application fields of BMS

1.Electric vehicle development background

More and more countries have set "death clauses" for fuel vehicles, and it seems that the countdown to the time when fuel vehicles will disappear from the automotive industry stage can begin. Are electric vehicles really so attractive that they deserve to be promoted with all their might and become the means of transportation in the future? Or is there another reason behind it that makes consortiums and countries flock to it?
Electrification reduces carbon emissions

The greenhouse effect is deteriorating faster than human imagination. According to a United Nations report, if the current rate of warming continues, the earth will break the 1.5-degree temperature threshold as soon as 2030, which will lead to rapid sea level rise and trigger global extreme climate events. In other words, we only have 11 years left to make changes. It will be extremely difficult to reverse the status quo, but at least we can extend the time to reach critical warming to a certain extent.
Therefore, reducing carbon emissions has become an imperative and key task, and one of the key points is the reform of transportation. By fully electrifying vehicles, the carbon emissions generated by transportation can be reduced. However, everyone should note that the word here is "reduce" rather than "return to zero". The electric vehicle itself does have zero emissions while driving, but generating electricity still produces carbon dioxide, which must be accounted for by the electric vehicle. Therefore, there have been voices questioning why it is necessary to switch from one type of power that produces carbon dioxide to another type of power that also emits carbon dioxide?

Changing oil and using electricity can indeed reduce carbon emissions. Even if power generation and transmission losses are taken into account, the energy efficiency of electric vehicles is still higher than that of gasoline vehicles.
In fact, electric motors are much more efficient than internal combustion engines. High efficiency means that electric vehicles can run farther using the same energy. Estimated from the source of raw materials to the time the vehicle is driven, the energy efficiency of electric vehicles is 20.1%, which is higher than 14.6% of gasoline vehicles. In other words, over the same distance, electric cars consume less and therefore have lower carbon emissions. Even if the energy conversion rate during power generation is added to the power transmission and transformer losses, electric vehicles still outperform internal combustion engine vehicles.

strategic factors
Reducing carbon emissions is only one of the reasons why countries are actively promoting the electrification of vehicles. We all know that the real world attaches far less importance to environmental protection, sustainability, and the future than national interests. When encountering conflicts of interest, environmental protection is often the option that can be given priority. So why are European and American countries still actively promoting the electrification of cars? The deeper reason lies in the strategic considerations behind it: energy independence.

Energy independence is an important issue for all countries. Oil is not available everywhere, but power plants can be built everywhere and all transportation vehicles will be electrified, which will be of great help in improving energy independence.
Oil production is in the hands of a few groups. Even if most countries have adequate sources of petrochemical fuels, no one can guarantee that oil pipelines and transportation routes will not be controlled or interrupted when war comes. When two countries, or even more countries, are at war, whoever loses oil supply will lose the war.
Electrification will indeed not affect the military in the short term. Military vehicles, tanks, fighter jets, etc. will still use petrochemical fuels. After all, replenishment is convenient and fast. The advantages in this regard are far inferior to electric vehicles. The interruption of oil will really affect people's livelihood and economy. All civilian vehicles will be stopped and cannot be used. There is no need to describe how serious the consequences of transportation paralysis will be.

If you find it difficult to imagine, look at the transition from the film era to the digital era. How many of the greats from that time are still alive? Look at the transformation of mobile phones from traditional functional models to smart phones. How many of the once-all-powerful manufacturers have shrunk? Therefore, as long as all car manufacturers have the ability, they will work hard to participate in this industrial war. Even if they do not expect to lead, they must not fall behind others.

2.The wave caused by the short-term transportation industry

According to data, global short-term transportation is currently in a period of rapid development driven by supply, with certain dividends from industrial upgrading. Due to the production advantages of batteries and motors, it will gain strong industrial advantages in the field of short-term transportation in the future.
Analysis of short-term transportation supply: power innovation brought by batteries
Short-term transportation refers to trips of less than 3 kilometers. Before the large-scale application of lithium batteries, cheap and reliable batteries were mainly lead-acid batteries and nickel-metal hydride batteries. Their common characteristics are: small capacity, not resistant to high temperatures, short cycle life, making it difficult to create competitive products. Product innovation for short-term transportation was slow during this period. Between 2010 and 2015, the cost of lithium batteries dropped by nearly 70%, entering the stage of large-scale application. Around 2015, the application of lithium batteries ushered in long-lost innovations in the field of short-term transportation. Many innovations such as electric scooters, balance bikes, smart two-wheelers, electric mopeds, electric skateboards, and onewheel emerged. The development history of these new tools will be briefly described below.

(1) Electric scooter
In 2016, when the sales of balancing scooters exploded, new electric scooters began to come into people’s sight. In the following years, electric scooters exploded on both the sharing side and the consumer side, bringing short-distance transportation into a new stage. According to some public data, it can be estimated that global electric skateboard sales in 2020 will be around 4-5 million, making it the fourth largest micro-mobility tool in the world after bicycles, motorcycles and electric bicycles. Electric scooters have a history of more than 100 years, but sales have only exploded in recent years. This is also closely related to the application of lithium batteries. Portable travel tools such as electric scooters can be carried on the subway and into the office. They can only be competitive if they are light enough. Therefore, before the application of lithium batteries, it is difficult for the B-side and C-side of electric scooters to have vitality. At present, electric scooters still maintain rapid development and are expected to become the mainstream short-term transportation tool in the future.
(2) Electric-assisted bicycles
Electric mopeds use batteries to provide auxiliary power and are equivalent to "hybrid" bicycles. Electric mopeds appeared in Japan as early as the 1990s. They were initially equipped with lead-acid batteries and were later replaced with lighter nickel-cadmium batteries. Electric mopeds were not popular before. It was not until around 2010 that electric mopeds in Europe showed a growing trend and gradually became a substitute for bicycles. The main driving force behind the popularity of electric-assisted bicycles is still the application of lithium batteries. Combined with the consumption concept of low-carbon travel in Europe, electric-assisted bicycles gradually replace bicycles. From 2015 to 2020, the penetration rate of electric mopeds in Europe and the United States increased threefold between 2015 and 2020, with sales reaching 6.5 million units. Many organizations predict that global sales of electric-assisted bicycles will reach 15 million units in 2025, and they are expected to replace bicycles and become the main force in leisure travel in the future.
(3) Lithium battery two-wheeled vehicles
In 2015, Niu Electric's first product N1 was released and raised 27.5 million yuan in just one day, becoming the largest crowdfunding project in China at that time. N1 is an electric two-wheeled vehicle. Different from traditional lead-acid two-wheeled vehicles, this vehicle uses lithium batteries of the same level as Tesla. It has a portable battery design and is equipped with intelligent functions. It is called the youth product. The first "Tesla". At present, Maverick Electric is already a listed company with a market value of billions of dollars. The reason for their success is that they have captured the lithium-ionization trend of electric two-wheeled vehicles. Before the application of lithium batteries, China's lead-acid two-wheeled vehicle sales had reached 30-40 million levels. Traditional lead-acid bicycles require a lot of weight just to maintain normal power, making it difficult to create high-end products. Lithium batteries bring "remaining power" to electric two-wheelers and are used for intelligent exploration, which has also changed the product form. With the popularization of electrification and intelligence, two-wheelers are also undergoing product upgrades. It is expected to upgrade from an industry with an ASP of about 1,500-2,000 yuan and a gross profit margin of about 10% to 15% to one with an ASP of 2,000-4,000 yuan and a gross profit margin of about 10% to 15%. Industries with interest rates reaching 20% to 25%.

Analysis of demand for short-term transportation: changes in consumption concepts in the later stages of urbanization
This section attempts to answer two questions: Where does the demand for short-term transportation come from? What changes have occurred recently?
(1) Source of long-term demand for short-term transportation: capacity transfer in the post-urbanization cycle
Bicycles were the most important tool for short trips in the past, so their sales can indirectly reflect the demand trend for short trips. Below are several sets of data about the United States. First, although the population of the United States has continued to grow in the past 30 years, car sales have peaked, and only bicycle sales are increasing; second, the number of bicycle trips in the United States has increased from 1.8 billion to 4 billion between 1990 and 2009. Third, in the past 10 years, bicycle commuting in the United States has increased by 47%, with the top five cities increasing by 73%.

in the past few decades, the incremental travel demand in the United States has flowed more towards short-term transportation. This phenomenon is more obvious in larger cities, and there is a similar phenomenon in Europe.
The growth in short-term travel demand in Europe and the United States is a natural result of late urbanization. In the early stage of urbanization, road resources were sufficient, which led to the rapid growth of automobiles with strong transportation capabilities and high flexibility. However, in the later stages of urbanization, insufficient road resources will hinder the growth of automobiles, so new travel demand will flow more to other travel modes—either to short-term transportation or to public transportation such as subways. Since the use of public transportation will bring last-mile demand, it will also indirectly drive short-term transportation demand. Therefore, in the later stages of urbanization, transportation capacity will always flow more to short-term transportation, which is the main driving force for the growth of bicycle demand in Europe and the United States. In addition, as the concept of "low-carbon travel and healthy travel" becomes popular in Europe and the United States, consumers are more and more interested in energy-saving and environmentally friendly transportation. Electric products are both energy-saving and labor-saving, which greatly meet the changing needs.

Data source: wind, bloomberg, statistic, compiled by Dunhe stock research team
(2) Short-term changes in short-term traffic demand
In the short term, at least two changes will have an impact on the short-term transportation field:
First, the rise of shared micro-mobility
Shared micromobility emerged in the United States in 2016. At its peak in 2018, the amount of financing exceeded US$30 billion a year, and leaders such as Bird and Lyft emerged. According to McKinsey's estimates, the micromobility market in the US market alone will reach US$200-300 billion in 2030. The emergence of the sharing model allows consumers to use the leasing model for short-term transportation consumption, improving the cost performance of consumption, and its potential market space is huge. In the early days of shared micromobility, 90% of the investment was spent on shared bicycles. But since the second half of 2018, most investment has been poured into shared scooters. In 2019, shared scooters flowed from the United States to Europe. Currently, Paris and Berlin have become the top three shared scooter markets in Europe. Europe has also set off an electric wave of micro-mobility.

Second, the epidemic promotes the explosion of C-end demand
Affected by the epidemic, U.S. bicycle sales exploded in Q2 of 2020, and sales have reached new highs every quarter since then. BPD data shows that in the past year, U.S. bicycle sales increased by 70% year-on-year in 2019, of which electric-assisted bicycles increased by 240% and are the fastest growing category. The bicycle guide website recently stated that the supply of bicycles is likely to exceed demand until 2023.

It is an objective fact that the epidemic is driving the demand for overseas personal micro-mobility to explode. Even if this driving force is not sustainable enough, it can be seen that electric micro-mobility tools have strong potential demand and vitality. The epidemic may be an important driver in cultivating consumption habits!

What is an electric vehicle battery management system（BMS）?

Based on the above analysis, the development of BMS has become unstoppable. Let’s discuss what a BMS is and what kinds of BMS there are

For example:

As the core component of new energy vehicles, the power battery pack accounts for a very high proportion of the cost of vehicle manufacturing, and its performance also affects the endurance and safety performance of the vehicle. The power battery also has an indispensable component, which is the BMS management system. So what is a BMS management system?

The battery management system, BMS (Battery Management System) in English, is an important part of the electric vehicle power battery system. It can detect, collect and preliminarily calculate the real-time status parameters of the battery, and at the same time control the on and off of the power supply circuit based on the comparison between the detected value and the allowed value; in addition, it will also feed back the collected key data to the vehicle controller and receive the controller instructions to coordinate with other systems on the car. Different battery cell types generally have different requirements for management systems.

The lithium-ion battery used in electric vehicles has a large capacity, a large number of series and parallel nodes, and a complex system. It also has high performance requirements such as safety, durability, and power, and is difficult to implement. Therefore, it has become a bottleneck affecting the promotion and popularization of electric vehicles. The safe working area of lithium-ion batteries is limited by the temperature and voltage windows. When the window is exceeded, the battery performance will accelerate attenuation and even cause safety issues.

The main purpose of the battery management system is to ensure the design performance of the battery system and provide functions from three aspects: safety, durability, and power. In terms of safety, the BMS management system can protect battery cells or battery packs from damage and prevent safety accidents. In terms of durability, even if the battery operates in a reliable and safe area, the service life of the battery is extended. In terms of power, the working condition of the battery must be maintained to meet the vehicle requirements.

There are many fast cells in a lithium-ion battery pack. How does BMS manage them? The important work of the BMS system is divided into two major tasks: battery detection and ensuring the safety of lithium-ion batteries.

Among them, battery detection is relatively simple to implement. The important thing is to collect parameter information of the battery during use through sensors, such as: temperature, voltage and current of each battery cell, voltage and current of the battery pack, etc. These data will play a vital role in the subsequent battery pack management. It can be said that without the support of these battery status data, the system management of power lithium-ion batteries will be impossible.

The important functions of the battery management system can be broken down into the following three aspects:

1. Safety, protect battery cells or battery packs from damage and prevent safety accidents;

2. Durability, allowing the battery to operate in a reliable and safe area and extending the service life of the battery;

3. Power, maintain the battery working in a state that meets the requirements of the vehicle.