QuantumScape and PowerCo Expand Strategic Collaboration for Solid-State Battery Technology
Collaboration between QuantumScape and PowerCo broadens, aiming to speed up the commercialization of advanced solid-state battery technology.
QuantumScape Corporation and PowerCo, a subsidiary of the Volkswagen Group, have expanded their strategic partnership to accelerate the commercialization of QuantumScape's groundbreaking solid-state battery technology. The updated agreement, announced in July 2025, builds on their original partnership from July 2024 and is aimed at fast-tracking the development and scaling of QuantumScape's QSE-5 battery cell.
Key Elements of the Updated Partnership
- Increased Financial Commitment: PowerCo will provide up to $131 million in additional payments over two years, contingent on the achievement of specific milestones by the joint scale-up team. The first milestones have already been met, with payments expected to begin in 2025. This is in addition to the previously announced $130 million tied to technical progress and execution of the licensing agreement.
- Production Scale-Up: The expanded deal allows PowerCo to engage earlier in QSE-5 production automation, accelerating the ramp-up of QuantumScape’s pilot line in San Jose. This step is critical for scaling manufacturing and enabling technology transfer for global markets.
- Licensing and Output Rights: PowerCo gains the rights to produce up to an additional 5 GWh of QSE-5-based cells annually, including for customers outside the Volkswagen Group. The agreement also provides PowerCo with access to license certain future QuantumScape technologies.
- Potential Total Capacity: When combined with existing agreements, the collaboration could result in a total production capacity of up to 85 GWh annually at full scale.
Technological and Manufacturing Advances
- Cobra Process Breakthrough: QuantumScape has fully integrated its proprietary Cobra process into baseline production, improving ceramic separator production speed by a factor of 200. This advancement is expected to support gigawatt-level solid-state cell production and higher-volume B1 sample deliveries, laying the groundwork for mass-market adoption.
- Graphite-Free Design: QuantumScape’s batteries use a graphite-free anode, offering a strategic supply chain advantage by avoiding reliance on graphite, a material subject to geopolitical and sourcing risks.
Strategic Implications
- Industry Confidence: The expanded partnership is seen as a strong vote of confidence in QuantumScape’s technology, which has been in development for over a decade but is now closer than ever to commercialization.
- Selective Partnership Approach: QuantumScape is also pursuing a joint development agreement with a second, unnamed global automotive OEM, signaling growing industry interest. However, the company is carefully managing the number of partnerships to ensure successful scaling with chosen customers.
- Commercialization Timeline: The collaboration is targeting commercialization by 2026, with the Cobra process and expanded production agreements positioning QuantumScape and PowerCo as leaders in next-generation battery technology.
Summary Table: Key Elements of the QuantumScape–PowerCo Collaboration
| Aspect | Details | |--------------------------|-------------------------------------------------------------------------| | Financial Commitment | Up to $261 million total ($131M new + $130M existing), milestone-based [2][4] | | Production Capacity | Up to 85 GWh annually at full scale (including new 5 GWh/yr for PowerCo)[1][2] | | Technology Focus | QSE-5 solid-state lithium-metal battery, Cobra process for separators[1][3] | | Manufacturing | Accelerated pilot line, earlier PowerCo involvement, tech transfer[2] | | Strategic Advantage | Graphite-free design, selective OEM partnerships[1] | | Commercialization Target | Aiming for 2026 market entry[1] |
Conclusion
The expanded QuantumScape–PowerCo collaboration marks a major step forward in solid-state battery commercialization, combining significant financial investment, advanced manufacturing processes, and strategic industry partnerships to bring high-energy-density, fast-charging batteries to the global automotive market. The Cobra process and graphite-free design further strengthen QuantumScape’s competitive position as it moves toward mass production and deployment.
Dr. Siva Sivaram, the CEO and president of QuantumScape Corporation, remains at the helm of the company. Both companies share a confidence in QSE-5 as a game-changing platform for the battery industry. The agreement between QuantumScape Corporation and PowerCo is designed to facilitate earlier engagement in QSE-5 production and automation efforts.
- The financial commitment from PowerCo has increased, totaling up to $261 million, with $131 million contingent on specific milestones in the renewable-energy industry, particularly for QuantumScape's solid-state battery technology.
- The expanded partnership between QuantumScape and PowerCo is leveraging technology from data-and-cloud-computing and technology, such as the Cobra process, to improve ceramic separator production speed by a factor of 200, with implications for renewable-energy storage and mass-market adoption.
- In the race for next-generation battery technology, this strategic collaboration aims to position QuantumScape and PowerCo as leaders, targeting commercialization by 2026 and potentially reaching a production capacity of up to 85 GWh annually, with an edge provided by QuantumScape's graphite-free design.
