This category is comprised of establishments primarily engaged in manufacturing storage batteries, including alkaline cell storage batteries, rechargeable batteries, lead acid storage batteries, nickel cadmium storage batteries, and other types of storage batteries.
335911 (Storage Battery Manufacturing)
The storage battery industry is driven by industry needs for small, long-lasting, cost-effective storage, or rechargeable, batteries. Batteries have been named as the limiting factor in the design of products ranging from laptop computers to electric automobiles. They are important in supplying starting and lighting power for conventionally fueled vehicles; supplying emergency power for various applications; for load-leveling or supplying additional power during peak demand as part of electrical utility systems; and as a supplement to solar, wave, or wind power. Uninterruptable power supply systems, usually designed to combat drops in power for personal computers (PCs), have created a new market for storage batteries. In all of these applications, the main feature of the storage battery is that it can retain energy supplied from an external electrical charge, whereas the electro-chemical reaction within primary batteries cannot be reversed. The total value of storage battery industry shipments reached $4.59 billion in 2000.
Approximately 133 major U.S. establishments competed in the $4.0 billion storage battery industry in 1996, with 84 having more than 20 employees. According to one accounting, regional producers accounted for about 13 percent of sales of automotive and specialized storage batteries. The overall market was dominated by large manufacturers such as Duracell International and Rayovac Corp., and by companies specializing in SLI (starting, lighting, and ignition) and industrial storage batteries, such as Exide Corp. and Gates Energy Products. These latter companies gained market share through acquisitions of related manufacturers since the earliest days of the industry.
Credit for the invention of the first true storage battery has been given to Gaston Plant, for a lead-acid battery he developed in 1859. It was made of two coiled lead strips separated by a cloth. However, his storage battery required charging by primary cells, a process taking months to years. The introduction of the French "Faure Electric Accumulator" two decades later generated excitement in Europe, Great Britain, and the United States. It was conceived that the devices would be delivered to homes and businesses daily, like milk deliveries. Demand for electric, rather than gas, streetlights was strong from the beginning, and electrical lighting in the home gradually became a status symbol. However, similar designs of batteries patented by Faure, a Frenchman, and Charles Brush, an American, resulted in patent litigation, which paralyzed American storage battery manufacturers for four years.
Electricity was not readily available on a large scale until the 1880s. This gave impetus to the development of storage batteries, used for over 35 years while alternating current systems were being developed and perfected. The batteries used were large enough to power over 2 million homes for an hour. Although AC power began to carry more of the load, storage batteries continued to be used in the operation of electrical switches in the power networks. The appearance of "horseless carriages" in the 1890s also fueled demand for storage batteries.
In the early days of the automobile, storage batteries were seriously considered as an alternative to horses and internal combustion engines. Storage batteries powered racing horseless carriages and electric cabs. However, the batteries could not compete in long distance travel and use declined with an increase in better roads. However, they continued to be well-suited for town travel; gasoline vehicles of the day had to be hand-cranked, a risky prospect. Storage batteries helped provide a solution for this difficulty, thereby relegating the electric passenger car to obsolescence. The first automobile to use an electric starter as standard equipment was the 1912 Cadillac.
The use of electric street trucks continued into the 1930s. By this time, storage batteries powered household appliances, boats, and the first submarines. In World War II they also powered torpedoes, aircraft radios, and commercial broadcast stations. In addition, they were used to power local telephone exchanges and intercontinental repeater stations. Storage batteries excelled in other industrial uses, such as powering electric shuttles in mines and battery-powered trains, which became quite popular in Germany. Golf carts provided an important market for the batteries as well.
The market for automotive, commercial, and industrial storage batteries had long been considered mature and highly competitive by the 1990s. This competition drove many smaller manufacturers out of business as prices fell because of excess capacity. Successful producers of these types of batteries sought to maximize economies of scale; new technologies were often quite expensive to introduce. Replacement batteries made up over 80 percent of the automotive battery market. An emphasis on technological improvement was most evident with suppliers for military and space programs, electric vehicles, laptop computers and cellular phones, and power management accessories.
Environmental legislation has driven carmakers to develop electric vehicles. Laws were introduced in various states requiring carmakers to sell a certain number of emissionless vehicles. The limiting factor in efforts to create such vehicles was the creation of storage batteries that were light and powerful, yet cost effective. Recycling efforts were another important theme in the storage battery industry, as many metals (e.g. cadmium) used posed health and environmental risks. The recycled metals also form an important part of commodity supplies, particularly recovered lead.
A key indicator of the competitive nature of the storage battery industry in the late 1990s was the Ralston Purina Co.'s decision to spin off its Eveready Battery Co. in June 1999. The battery division had been experiencing hard times: Duracell International Inc., which claimed a 50 percent share of the U.S. battery market, sued Eveready, which claimed a 19 percent market share, over the latter's advertising of superiority for its Energizer batteries. Moreover, Eveready backed out of the rechargable battery business in the face of stiff competition from Asian battery manufacturers. In November 1999 Ralston Purina finalized its sales of its Energizer Power Systems Original Equipment Manufacturer rechargable battery business to Tucson-based Moltech Corporation.
Industry shipments grew from $4.25 billion in 1998 to $4.95 billion in 2000. Over the same time period, the cost of materials increased from $2.22 billion to $2.58 billion, and employment rose from 21,900 workers to 23,346 workers. Production workers in 2000 numbered 18,807; they earned, on average, $15.15 per hour.
Exide Corporation of Bloomfield Hills, Michigan, generated $2.4 billion in sales for the fiscal year ending March 31, 1998; Exide employed 16,300 workers. Duracell (bought in 1996 by Gillette Co. for over $7.0 billion), reported sales of $2.3 billion for the fiscal year ending June 30, 1996, according to the most recent information available on Infotrac. Duracell reported 9,600 employees. Eveready's sales reached $2.1 billion for the fiscal year ending September 30, 1998, with 18,000 employees. Motorola Inc. Energy Products Div. of Lawrenceville, Georgia, garnered $555.0 million in sales for the fiscal year ending December 31,1997, with 4,000 employees. Rayovac Corp. of Madison, Wisconsin, employed 2,300 workers and generated sales of $432.0 million for the fiscal year ending September 30, 1997.
The top 500 industry competitors employed about 26,300 workers in 1995. In the mid-1990s, Exide employed 1,501 salaried employees and 3,791 hourly employees. It reported that 40 percent of its salaried employees were engaged in sales, service, and marketing, and 30 percent were engaged in engineering and manufacturing. Of its hourly employees, 32 percent were represented by unions, with whom the company claimed good relations.
In the mid-1990s, Duracell controlled 40 percent of the lucrative alkaline battery market worldwide, whereas Eveready claimed a sales advantage in lower performance zinc-carbide batteries more widespread in developing countries.
In the mid-1990s, Japan's storage battery industry pulled out of a slump caused by an imbalance of trade with the United States. New technologies, such as lithium-ion and nickel-hydrogen batteries, and marketing geared toward the consumer electronics market appeared responsible for the turnaround.
Japan has been slow to embrace the electric car, perhaps because its environmental lobbies have lacked the clout of those in the United States and Europe. Great Britain and Germany have generally embraced battery-powered vehicles, where postal services were likely users.
Most SLI batteries have been of the lead-acid variety developed in the late nineteenth century. They are an excellent potential power supply for other applications because of their low cost and availability. They are also easy to recycle. Specialized military and aviation-related applications have called for nickel-cadmium cells, which were popularized through portable radios and other consumer devices. Their cost remained prohibitive for automotive use, however, due to the high cost of cadmium. As used in vehicles, they offer somewhat higher performance than lead-acid batteries but are equally as heavy and much more difficult to recycle.
A similar type of battery to the nickel-cadmium, the iron-nickel oxide alkaline battery was invented by Thomas Edison and patented in the United States in 1901—the same year as Jungner's nickel-cadmium battery. Due to poor performance, the iron-nickel oxide batteries did not meet with the same success as the nicads.
Nickel hydrogen batteries have been introduced as an alternative to nicads. They possess a greater capacity and boast environmental benefits since they do not contain cadmium. Sanyo Electric has been the leader in developing and producing these cells, used in portable telephones, laptop computers, and camcorders, in the early 1990s. Other types of secondary cells invented at the end of the nineteenth century included those utilizing zinc as an electrode. These have been used in satellites, military aircraft, submarines, and assorted military equipment. On satellites, they have generally been used in conjunction with solar power.
Sony introduced a lithium ion secondary storage battery for use in portable telephones and camcorders. It featured twice the capacity of a hydrogen storage cell and one-third the weight. An innovation among consumer battery manufacturers was announced by Rayovac in 1993: reusable alkaline batteries, a concept traditionally thought unworkable. The company claimed its batteries could hold a charge for up to five years, compared to three months for nicads. In 1993, toy manufacturer SLM International introduced a controversial recharger for ordinary alkaline batteries. In 1994, Duracell Inc. announced its Advanced Battery-Pack Interconnect for nickel-metal-hydride connections, which featured an automatic battery contact cleaner and other refinements. The number of competing designs among manufacturers, in addition to the higher initial cost for rechargeables, seemed to slow this segment's growth.
Nickel-metal-hydride (NiMH) batteries showed great promise in the 1990s for applications involving laptop computers. However, both nickel-cadmium and nickel-metal-hydride (NiMH) batteries deteriorate if they are overcharged. A strategy to combat this has been to install integrated circuits capable of monitoring battery voltage, charge/discharge current, and cell case temperature. The goal in the mid-1990s was to recharge atypical laptop battery in 15 minutes. Several automobile manufacturers, including General Motors, Honda, and Toyota, gambled that NiMH would become the next generation fuel source for electric vehicles. Other research tested nicad, sodium sulfur, zinc-air, and lithum technologies as possible alternatives to lead-acid batteries.
Consumer demand, environmental legislation, and other factors made electric car research a high priority in the last quarter of the twentieth century. Electric utility companies supported research in electric cars, partially to encourage the more consistent electricity use that would occur from the vehicles being charged at night, during off-peak hours. Vehicle traction batteries, the kind used to drive vehicles, have been produced in various configurations. Lead-acid batteries were not powerful enough or light enough for the task.
Other more complex electric vehicle options included hybrid systems involving a battery in addition to an internal combustion engine. The hope was that a practical vehicle of this type would also allow increased efficiency by means such as regenerative braking. Hybrid battery types, including a lead-acid battery for acceleration and a zinc-oxide battery for cruising, were also considered.
Other technological innovations included gauges to indicate the remaining life on individual alkaline batteries. Both Duracell and Eveready used these to market their batteries in the mid-1990s. In addition, at least one company was investigating insulation as a means of maintaining the performance of lead-acid batteries in cold weather.
Bottoms, David. "Rechargeable Batteries: The Quest for More Power." Industry Week, 3 June 1996.
Bulkeley, William M. "Duracell Pact Gives Gillette an Added Source of Power." The Wall Street Journal, 13 September 1996.
Infotrac Company Profiles, 21 December 1999. Available at http://web7.infotrac.galegroup.com .
Lowentstein, Roger. "Intrinsic Value: Blades, Batteries, and a Fifth of Gillette." The Wall Street Journal, 19 September 1996, C1.
Naj, Amal Kumar. "Latest Version of Zinc-Air Batteries Promises to Show Long-Lasting Results." The Wall Street Journal, 10 November 1995.
"Ralston Completes Sale of Rechargable Battery Business." PR Newswire, 1 November 1999.
Reda, Susan. "Cost, Standardization Issues Plague Rechargeable Market." Stores, June 1996.
Stroud, Jerri. "Ralston Plans to Spin Off Eveready." St. Louis Post-Dispatch, 11 June 1999.
United States Census Bureau. "Statistics for Industries and Industry Groups: 2000." Annual Survey of Manufacturers. February 2002. Available from http://www.census.gov .
Vincent, Colin A., Bruno Scrosati, Mario Lazzari, and Franco Bonino. "You Can Buy Yourself an Electric Car, But It Isn't Going to Take You Very Far." The Wall Street Journal, 15 May 1996.
Yuasa, Teruhisa. "Storage Battery Industry Sees Revival." Japan 21st, October 1996, 41.