EV Supply Chain Play: Why Solid State Power (SLDP) Can Be a Hidden Gem in Battery Tech
The electric vehicle (EV) revolution is shifting into high gear, and battery technology is at the center of it all. While traditional lithium-ion batteries dominate the industry, the race to sell solid-state batteries (SSBs) is growing. These next-generation batteries promise higher energy density, faster charging, and improved safety. The transition from lithium-ion to solid-state technology is driven by the increasing demands for long-range EVs, more sustainable materials, and the desire for safe energy storage solutions. If implemented successfully, SSBs can redefine the EV landscape and market dynamics in favor of companies that can successfully bring the technology to mass production.
Among the companies leading this case are Dynamic Power (SLDP)solid state battery engineer. Unlike competitors who focus on producing entire battery packs, Solid Power’s business model focuses on solid sulfide-based electrolyte, which it supplies to car manufacturers and battery manufacturers. This unique configuration allows the company to overcome some of the biggest challenges of manufacturing perfect batteries while still benefiting from the growing demand for energy storage solutions. With major automaker partnerships and recent financial milestones, the company is gaining momentum as a potential player in the EV supply chain.
Critical Partnerships and Productivity Measurement
Solid Power’s development strategy relies on strategic collaboration with industry giants. The company has secured multi-year joint development agreements (JDAs) with BMW and Ford Motor Company (F)allowing these automakers to integrate solid-state battery technology into their future EV platforms. In 2024, the company successfully met the milestones under these agreements, and confirmed its continuity. Continued cooperation with these major players highlights Solid Power’s credibility in the highly competitive field of battery technology and raises confidence in its ability to deliver on its technological promises.
Additionally, Solid Power strengthened its industry position by expanding its partnership with South Korean battery manufacturer SK On. The agreement involves the transfer of technology and the supply of electrolyte, which can speed up commercialization. Strong power is also awarded until $50 million from the US Department of Energy (DOE) to measure its electrolyte production capacity. This grant not only provides the company with a financial boost but also serves as a guarantee from the federal government, which is keen to encourage the establishment and production of domestic batteries.
On the production front, Strong Power has raised electrolyte samples, providing critical feedback to potential customers. The approval of the Electrolyte Innovation Center (EIC) in 2024 is another major step, allowing for rapid research and development of advanced battery materials. The facility will play a key role in refining Solid Power’s electrolyte formulation and ensuring it meets the stringent requirements of commercial battery production. The ability to quickly iterate and improve designs based on real-world testing and customer feedback gives the company a strong competitive edge.
How Strong Powers Emerge
Solid-state batteries are often considered the next big leap in energy storage, and Solid Power technology has a distinct advantage over traditional lithium-ion cells. The company’s focus on solid sulfide-based electrolyte is particularly noteworthy, as this material provides high ionic conductivity and stability, making it a strong candidate for use in next-generation battery cells. Key benefits of Solid Power technology include increased energy density, which can translate to longer EV driving ranges, and improved safety by eliminating the flammable liquids found in lithium-ion batteries.
Another major advantage is that Solid Power’s battery designs are compatible with existing lithium-ion manufacturing infrastructure. This means that car manufacturers and battery manufacturers can integrate Solid Power technology without needing to completely overhaul their production lines, lowering barriers to its use. This compatibility makes Solid Power an attractive partner for automakers looking to transition to solid-state technology without taking excessive manufacturing risks.
Although competitors like QuantumScape (QS) again SES AI (SES) they also raced to sell solid-state batteries, a Solid Energy approach to supply essentials rather than competing for full-scale manufacturing positions exclusively in the supply chain. By focusing on electrolyte production and licensing its cell designs, Strong Energy mitigates some of the high costs associated with scaling up battery production. This model allows it to grow efficiently while maintaining the flexibility to serve more customers across the industry.
Financial Analysis and Growth: Income and Risks
Strong Power Reported $20.1 million in 2024 revenue, marking an increase of $2.7 million from the previous year. This growth has been largely fueled by its agreements with SK On and other strategic partners. However, as a company in the R&D stage, it recorded a net loss of $96.5 million, reflecting higher operating costs associated with development and scaling efforts. These financial figures highlight both the strengths and challenges facing Solid Power as it approaches commercialization.
The company maintains a strong financial position, with a total of $327.5 million as of December 31, 2024. This financial milestone provides a path to use its technology roadmap, but investors should be aware of trading risks. Solid-state battery technology is still developing, and although the company has made significant progress, there is no guarantee that its solutions will reach mass production as quickly as expected. Additionally, industry-wide factors such as supply chain disruptions, raw material costs, and changes in government policies regarding EV subsidies could impact Solid Power’s growth trajectory.
The company expects capital investment in 2025 to be between $100 million and $120 million, highlighting its aggressive focus on production. While this investment is necessary for long-term success, it also means that profitability remains a distant prospect. Investors should keep a close eye on the company’s ability to manage its cash burn while continuing to meet technical and manufacturing milestones.
Investment Outlook: Is SLDP a Buy?
For long-term investors seeking exposure to next-generation battery technology, Strong Energy presents a compelling but speculative opportunity. The company’s relationships with BMW, Ford, and SK On ensure its expertise, and its non-exclusive agreements leave room for further collaboration. However, risks remain—SSB’s sales timelines are uncertain, and profits are years away. Investors who can tolerate volatility and have a long investment horizon may find SLDP an attractive option.
The broader EV market continues to grow, and advances in battery technology will play an important role in shaping the future of the sector. If Solid Power can successfully scale its electrolyte production and secure additional partnerships, it may emerge as a key supplier in the solid-state battery space. Those with a high risk tolerance may consider SLDP as a speculative addition to a diversified portfolio, while more cautious investors may prefer to wait for trading progress before investing.
