Q4 2023 SES AI Corp Earnings Call
Good afternoon, ladies and gentlemen, thank you for joining today's S. C. S. AI Corporation fourth quarter 2023, Linda calls.
Tia: Good afternoon, ladies and gentlemen. Thank you for joining today's SES AI Corporation 4th quarter 2023 lender call. My name is Tia, and I will be your moderator for today's call.
My name is Tia and I'll be your moderator for today's call.
Tia: All lines will be muted during the presentation portion of the call with an opportunity for questions and answers at the end. If you would like to ask a question, please press star one or your telephone keypad. It would be my pleasure to pass the call over to Cal Peckleton, Chief Legal Officer. Please proceed. Thank you.
All lines will be muted during the presentation portion of the call with an opportunity for questions and answers at the end. If you would like to ask a question. Please press star one or your telephone keypad.
It is my pleasure to pass the call over to Kal pick them to keep legal officer. Please proceed.
Thank you.
Cal Peckleton: Hello, everyone, and welcome to our conference call covering our fourth quarter 2023 results and financial guidance for 2024. Joining me today are Chi-Chau Hu, Founder and Chief Executive Officer, and Jingyi Alice, Chief Financial Officer. We issued our shareholder letter just after 4 p.m. today, which provides a business update as well as our financial results.
Hello, everyone and welcome to our conference call covering our fourth quarter 2023 results and financial guidance for 2024.
Joining me today are Chi Chow, who founder and Chief Executive Officer, and Jamie Atlas Chief Financial Officer.
We issued our shareholder letter just after four PM today, which provides the business update as well as our financial results you'll.
Cal Peckleton: You'll find a press release with a link to our shareholder letter and today's conference call webcast in the investor relations section of our website at FCS.ai. Before we get started, this is a reminder that the discussion today may contain forward-looking information or forward-looking statements within the meaning of applicable securities legislation. These statements are based on our predictions and expectations as of today. Such statements involve certain risks, assumptions, and uncertainties, which may cause our actual or future results and performance to be materially different from those expressed or implied in these statements.
You'll find our press release with a link to our shareholder letter and today's conference call webcast in the Investor Relations section of our website at <unk> Dot AI.
Before we get started this is a reminder that the discussion today may contain forward looking information or forward looking statements within the meaning of applicable securities legislation. These.
These statements are based on our predictions and expectations as of today.
Such statements involve certain risks assumptions and uncertainties, which may cause our actual or future results and performance to be materially different from those expressed or implied in these statements.
Cal Peckleton: The risks and uncertainties that could cause our results to differ materially from our current expectations include, but are not limited to, those detailed in our latest earnings release and in our SEC filings. This afternoon, we will review our business as well as our results for the quarter. With that, I'll pass it over to Chi Chau. Thanks, Kyle. Good afternoon, everyone.
The risks and uncertainties that could cause our results to differ materially from our current expectations include but are not limited to those detailed in our latest earnings release and in our SEC filings.
This afternoon, we will review our business as well as our results for the quarter with that I'll pass it over to Chi Chow.
Thanks, Paul.
Good afternoon, everyone. We posted a thorough shareholder letter on our website, which provides all the details for the quarter the year and our 'twenty to 'twenty four outlook now.
Chi-Chau Hu: We posted a thorough shareholder letter on our website, which provides all the details for the quarter, the year, and our 2024 outlook. Now, I want to make our time more efficient with a more focused conversation. There are three key points that I believe you should take away from SDS-AI's results and outlook. First,
Now I'll, let you make all the time more efficient with a more focused conversation.
There are three key points that I believe you should take away from CSA ice results and outlook.
First we.
Chi-Chau Hu: We became the world's first to enter into automotive B-sample joint development with a major automaker for lithium metal. This is a major milestone in the commercialization of lithium metal battery technology for automotive applications. In 2024, our focus will be delivering on our EVB sample joint development. Second, in addition to EV, we have also identified Urban Air Mobility, or UAM, as an exciting application for lithium metal. The high energy density and high power density of lithium metal really enable UAF.
We became the worlds first to enter into automotive be sample joined development with a major automaker forward lithium metal.
This is a major milestone in the commercialization of lithium metal battery technology for automotive applications.
In 2024, our focus will be delivering on our EV b sample joint development.
Second in addition to EV, we have also identified urban air mobility.
And that's an exciting application for lithium metal.
The high energy density and high power density of lithium metal really enables UAS.
Chi-Chau Hu: UAM is a natural stepping stone to EV for lithium metal. Third, to ensure practical safety, especially as we prepare for sea trials and commercial deployment, we are doubling down on the use of AI to monitor battery health and predict incidents. Our lithium metal large cell avatar AI prediction accuracy increased from just 60% in 2022 to 92% in 23. And this year, our target is 95%.
<unk> is a natural stepping stone to EV for lithium metal.
Third to ensure practical safety, especially as we prepare for see sample and commercial deployment, we are doubling down on the use of AI to monitor battery health and predict incident.
Lithium metal large cell avatar AI prediction accuracy increased from just 60% in 2020% to 292% in 'twenty three.
And this year, our target is 95%.
Chi-Chau Hu: Ultimately, we want to achieve near 100% safety guarantees for EV and UAM. Now, I'll talk more about 2023 accomplishments. 2023 was a great year for us.
Ultimately, we want to achieve near 100% safety guarantee for EV Uhm.
Now I'll talk more about 2023 accomplishments.
23 was a great year for US we took a massive step towards commercialization of our lithium metal technology for automotive applications. We signed the world's first automotive B sample joint development agreement for lithium metal batteries with a major automaker.
Chi-Chau Hu: We took a massive step toward commercialization of our lithium metal technology for automotive applications. We signed the world's first automotive B-sample joint development agreement for lithium metal batteries with a major automaker. No one has gotten this far with lithium-ion batteries for EV applications. This is a giant leap in the commercialization of lithium metal technology for cars. Our three JDA partners, GM, Hyundai, and Honda, continue to be very supportive and aggressively push for EV.
No one has gotten this far with lithium metal batteries for EV applications.
This is a giant leap in the commercialization of lithium metal technology for automotive applications our.
Our three J D H partners, GM, Hyundai and Honda continue to be very supportive and push aggressively in EV.
Chi-Chau Hu: Hyundai recently just became the second largest EV maker in the U.S. It's significant to note that two of the key milestones for entering into B-sample development include practical safety and manufacturability. We'll share more details on these two accomplishments. The first one is practical safety.
<unk> recently, just became the second largest EV maker in the U S.
It's significant to note that two of the key milestones for entering into be simple development include.
Tactical safety and manufacture ability.
Share more details around these two accomplishments.
The first one practical safety.
Chi-Chau Hu: Achieving hazard level 5 for large 50 MPa and 100 MPa lithium metal cells was a combination of improved safety in materials as well as improvements in cell design and engineering. In fact, we achieved greater safety-related breakthroughs in cell engineering than in materials. This was intentional because by having minimal changes to material chemistry and by focusing on cell design and engineering, we didn't have to sacrifice cell performance and energy density. We recruited the world's top cell engineering talent and created designs that are still based on lithium-ion, so they can be manufactured at scale but are unique for lithium metal and can address safety-related challenges. We won't go into details about these cell design and engineering improvements since they are our newest trade secrets.
Achieving a level five for large 50, empower and $100 hour lithium metal cells was a combination of improved safety and materials as well.
Improvements in cell design and engineering.
In fact, we achieved greater safety related breakthroughs in cell engineering than immaterial chemistry.
This was intentional because by having minimal changes to material chemistry and by focusing on cell design and engineering, we didn't have to sacrifice sell performance in energy density.
We recruited the worlds top sell engineering talent and creative designs that are still based on lithium ion so that can be manufactured at scale, but are unique for lithium metal and can address safety related challenges.
We won't go into details about these cell design and engineering improvements since they are our newest trade secrets, but these new designs engineering and process improvements.
Chi-Chau Hu: But these new designs, engineering, and process improvements are being incorporated into our new B-sample cells. With regard to manufacturability, we operated three A-sample lines last year. It's important to highlight that we built more large automotive liquid metal cells per month in just one line in 2023 than during all of 2022. This was made possible thanks to significant improvements in thin-looking metal anode production and anode electropuncturing in stacks.
Incorporated into our new B sample cells.
With regard to manufacture ability.
We operated three simple lines last year.
It's important to highlight that we built more large automotive lithium metal sales per month and just one line in 2023, then during all of 2022.
This was made possible thanks to significant improvements in white with thin lithium metal annual production and annual intellectual punching and stacking.
Chi-Chau Hu: We made the right decision to move lithium-ion anode production in-house; we were able to resolve issues associated with tear, wrinkle, and powders much more efficiently. By consistently producing a large quantity of large automotive lithium metal cells, we generated a large amount of data that we fed to our health monitoring and incident prediction avatar, the AI model. Prior to 2023, our avatar AI prediction accuracy was 60%, but at the end of 2023, we are pleased to announce that we achieved 92%.
We made the right decision to move lithium metal annual production in house, we were able to resolve issues associated with tier wrinkle and powders much more efficiently.
By consistently producing a large quantity of large automotive lithium metal cells, we generated a large amount of data that we felt our health monitoring and incident predictions appetite AI model.
Prior to 2023 hour Avatar AI prediction accuracy was 60% by the end of 2023, we're pleased to announce that we achieved 92%.
Chi-Chau Hu: This is an important progress. The combination of a greater number of cells and a greater number of quality control checkpoints per cell was instrumental to the training of our avatar AI model, making it more accurate. Our training data increased 10x from 2022 to 2023. We're confident that with more data training and advancement in the AI model, we will achieve 95% incident prediction this year and eventually reach near 100% safety guarantee. In 2023, we will also lay the foundation for using AI for future roadmap electrolyte development. The goal is to build a roadmap for future generations of liquid metals. Now we are switching to our 2024 plan.
This is an important progress.
Combination of greater number of cells and greater number of policy control checkpoints per cell was instrumental to the training of our avatar AI model, making the more accurate.
Our training data increased tenex from 'twenty to 'twenty two 'twenty three.
We're confident that with more data training and advancement in our model, we will achieve 95% insulin production this year and eventually reached near 100% and safety guarantee.
In 2023, we also lay the foundation for using AI for future roadmap electrolyte development.
The goal is to build a roadmap for future generations of lithium metal.
Now switching to our 2024 plants.
Chi-Chau Hu: We expect to make further progress in the automotive commercialization of liquid metal in 2024, and we will focus full steam on our EV bead sample JDA. We plan to further boost our cell engineering and process development efforts, and we will continue to improve cell practical safety and manufacturability. We plan to build and operate these sample lines with our JDA partners, potentially one at our own facility and another at our JDA partners' facility. These B-sample lines will incorporate our latest cell design and engineering, as well as manufacturing processing programs. These B-sample lines will also have our latest production quality control plan; we will increase from about 600 checkpoints to about 1,500 checkpoints later this year, including more imaging-based checkpoints, such as X-ray, ultrasound, CT, and vision. All these will be fully integrated with our avatar AI model. This means the amount of training data for the AI model will significantly increase in both quantity and quality. We've tracked our avatar AI prediction accuracy to reach 95% for large automotive sales. By the end of this, Avatar AI can reach near 100% incident prediction accuracy with sufficient data.
We expect to make further progress in automotive commercialization of lithium metal in 'twenty 'twenty four and we will focus full steam on our EVP simple J D.
We plan to further boost our cell engineering and process development efforts will continue to improve sell practical safety and manufacture ability.
We plan to build and operate the simple aligns with our JV partners potentially one at our own facility and another at our JV partner's facility.
This temple Alliance will incorporate our latest cell design and engineering as well as manufacturing process improvements.
These <unk> lines will also have our latest production quality control plan.
<unk> increased from about 600 checkpoints to about 1500 checkpoints later this year.
Looking more imaging based checkpoints, such as X Ray ultrasound Cte and vision.
All of these will be fully integrated with our avatar AI model.
This means the amount of training data for AI model will significantly.
And the increase in both quantity and quality.
We've talked all avatar AI prediction accuracy to reach 95% for large automotive sales by end of this year.
Avatar AI can reach near 100% incident prediction accuracy with sufficient data training. This is very different from today's lithium ion party data, which are still largely based on traditional statistical analysis and manufacturing data are decoupled from real world vehicle data and very basic models are.
Chi-Chau Hu: This is very different from today's lithium ion quality data, which are still largely based on traditional statistical analysis, and the manufacturing data is decoupled from real world vehicle data, and very basic models are used to predict. That's why we still have lithium-ion battery incidents that cost billions of dollars in recalls. Our avatar AI applies a far more advanced AI model that is pre-trained on both lithium metal and lithium ion data, and since we have access to a comprehensive set of material chemistry data, manufacturing quality data, and real-world vehicle data, we can achieve near 100% safety guarantee. This near 100% safety guarantee is extremely important for automotive applications. And it's only possible with advanced avatar AI.
To predict incidents that's why we still have lithium ion battery incidents that cost billions of dollars in recall.
Our appetite AI applies a far more advanced AI model that is pre trained on both lithium metal in lithium ion data and we have access to a comprehensive set of material temperature data manufacturing quality data and real world vehicle data.
We can achieve near 100% safety 17.
This near 100% safety guarantee is extremely important for automotive applications and its only possible with advanced Avatar AI.
Yeah.
Chi-Chau Hu: On the use of AI for roadmap electrical development, our amazing team of human scientists and AI scientists will work together to systematically study electrolyte chemical structures from public and internal databases. We're very excited to report that we will commission our new Electrolyte Foundry in Massachusetts to focus exclusively on high-throughput synthesis and testing of both human and AI generated electrolyte solvent and salt chemical structures. This is a super exciting area. Some pharmaceutical companies have already demonstrated promising signals using similar approaches.
On the use of AI roadmap, you'll actually our development, our amazing team of human scientists and AI scientists will work together to systematically studied electrical chemical structures from public and internal database.
We're very excited to report that we will commission, our new electrified foundry in Massachusetts to focus exclusively on high throughput synthesis and testing of both human and AI generated electrify solvent installed chemical structures.
This is a super exciting area. Some pharmaceutical companies have already demonstrated promising signals using similar approach. However, we are the very first to build this deep in the battery industry and the signals are very inviting.
Chi-Chau Hu: However, we are the very first to go this deep in the battery industry, and the signals are very inviting. We know we can accelerate the screening of novel electronic materials. Now let's see if we can use AI to develop a new electrolyte that's better than the best ever human-developed one. While we focus on the automotive commercialization of the current generation of liquid metal, this will help us build a robust roadmap for future generations of liquid metal.
We can accelerate the screening of novel electronic candidates now, let's see if we can use AI to develop a new electrical that's better than the best ever human develop one.
While we focus on automotive commercialization of current generation of lithium metal. This will help us build a robust roadmap of future generations of lithium metal.
In addition to the EV market, we identified urban air mobility, Uhm as a promising and exciting market that is about to take off, especially when powered by high energy density of lithium metal batteries.
Chi-Chau Hu: In addition to the EV market, we identified Urban Air Mobility, or UAM, as a promising and exciting market that is about to take off, especially when powered by high-energy-density lithium-metal batteries. It's significant to note that the B-sample for EV is equivalent to commercial production for UAM. For UAM, the energy density and power density of current lithium-ion batteries are too low.
It's significant to note that be simple for EV is equivalent to commercial production for you Ann.
For you in the energy density and power density of current lithium ion batteries are too low.
And that results in short flight time, and limited Tayloe and number of passengers, making the current Julien business not economical.
Chi-Chau Hu: And that results in short flight time and limited payload and number of passengers, making the current UAM business non-economic. Liquid metal with about 60% higher energy density will change all that and make UAM a profitable business. The leading UAM companies have been waiting for a lithium metal company that can produce high quality, large automotive grade cells, and 2024 will be a key year for Battery Design Inn in terms of qualification. In 2025, we'll see demonstration flights in major cities such as Seoul, New York City, and Abu Dhabi. This is perfect timing for us.
Lithium metal with about 60% higher energy density will change all of that and make a profitable business.
The leading <unk> companies have been waiting for a lithium metal company that can produce high quality large automotive grade cells.
In 2024 will be a key year for the battery design in qualification and 225, we'll see a demo flights in major cities, such as so New York City and Abu Dhabi.
This is perfect timing for us we will convert one of our <unk> lines in South Korea to produce exclusively uhm cells.
Chi-Chau Hu: We will convert one of our A-sample lines in South Korea to produce exclusively UAM cells. This will incorporate our latest production quality control plan and be fully integrated with Avatar AI. This line, just off of Seoul, will have all the quality and engineering improvements of our B-sample lines but be dedicated to UAM lithium metal cells, modules, and avatar AI development and production. So our 2024 goals will include three.
This will incorporate our latest production quality control plan and be fully integrated with Avatar AI.
This line just outside of Sul will have all of the quality and engineering improvements of our decentralized.
Dedicated to uhm lithium metal cells module, and avatar AI development and production.
So our 'twenty to 'twenty four goals more include three.
First is focused on BBB sample.
Chi-Chau Hu: First, we focus on CVB samples. We will work with our B-Sample joint development partners to build and operate new B-Sample lines. We will improve the manufacturing quality control plan from 600 to 1500 checkpoints. Second, we will ship UAM cells. Our UAM cells will be our first commercial product. We will build a dedicated UAM lithium metal line and ship the first batch of cells to our UAM customers. Third, an improved avatar AI incident prediction algorithm.
We will work with our be simple joint development partners to build and operate new decentralized.
We will improve manufacturing quality control plan from 600 to 1500 checkpoints.
Second is shipped uhm cells.
Our UA themselves will be our first commercial products.
We will build a dedicated uhm lithium metal line and ship the first batch of sales to our OEM customers.
Third is improve avatar AI incident prediction accuracy.
Chi-Chau Hu: Our ultimate goal is a near 100% safety guarantee for EV and UAM applications. In 2024, our goal is 95%. We will finish pre-training our avatar AI with EVA sample data and train it with new EVB samples and UAM cell data. These are challenging but exciting goals.
Our ultimate goal is near 100% safety guarantee for EV and Uhm applications.
In 2024, our goal is 95%.
We will finish pre training, our avatar AI with EV, a sample data and tech.
With new EVP sample and uhm sell data.
These are challenging and exciting goals.
Chi-Chau Hu: Progress in EVB sample development and shipping the first batch of UAM cells will represent major progress in the commercialization of lithium metal batteries for EV and UAM applications. Achieving 95% incident prediction accuracy for Avatar AI will represent a major milestone towards the ultimate goal of near 100% safety guarantee, which will be critical for real world safety. In each piece of roadmap material development, we're building an AI super science. In cell design and engineering, we're building an AI super engine. In manufacturing quality and real world health monitoring and incident prediction, we're building avatar AI.
<unk> and EVP simple development and shipping the first batch of <unk> themselves will represent major progress in the commercialization of lithium metal batteries for EV and Julian applications.
Achieving 95% incident prediction accuracy for Avatar AI will represent a major milestone towards the ultimate goal of near 100% and safety guarantee.
Which will be critical for real World safety.
In pizza roadmap material development, we're building AI Super scientist.
In cell design and engineering, we are building an AI Super engineer.
In manufacturing quality and real World Health monitoring incident predictions were building Avatar AI.
And this information can be used in our supply chain and sustainability management, so we reduce cost and steel to footprint and build a new supply chain for our customers.
Chi-Chau Hu: And this information can be used in our supply chain and sustainability management. So we reduce cost and CO2 footprint and build a new supply chain for our EV and UAM customers. At SCSAI, our mission is to power a new era of electric transportation on land and in the air with lithium-ion batteries. As we build more automotive large capacity lithium metal cells, generate more data, expand to B-sample, and prepare for C-sample in commercial production. AI is becoming an increasingly integral part of both material development and battery health monitoring and incident prediction.
At <unk>, our mission is to power, a new era of electric transportation on land and in air with lithium batteries.
As we built more automotive launch capacity lithium metal cells generate more data expand to be sample and prepare for see sample and commercial production.
It becomes an increasingly integral part of both material development and battery health monitoring and incident prediction.
Lithium metal not only leads to longer range and more passengers are near 100% safety guarantee and accelerated roadmap of technology development.
Gene Mieles: Lithium metal not only leads to longer range and more passengers but also near 100% safety guarantee and accelerated roadmap technology development. We realize that we're building more than just a battery for the beginning of a super intelligent AI for electric transportation. With that, I'll pass it to our Chief Financial Officer, Gene Mieles, for financial help. Thank you, Qiqiao. Good afternoon, everyone.
We realized that we are building more than just a battery company by the beginning of a super intelligent AI to electric transportation.
With that I'll pass to our Chief Financial Officer, Jim <unk> for financial update.
Thank you <unk> good afternoon, everyone today, I'll cover our fourth quarter and full year 2023 financial results and discuss our operating and capital budget for 2024.
Gene Mieles: Today I will cover our fourth quarter and full year 2023 financial results and discuss our operating and capital budgets for 2024. In the fourth quarter, our operating expenses were $17.9 million, down slightly from the same period last year. Stock-based compensation expense was $4.4 million in the quarter.
In the fourth quarter, our operating expenses were $17 9 million down slightly from the same period last year stock based compensation expense was $4 4 million in the quarter.
We reported research and development expenses.
Seven 4 million, our gross R&D spending in the fourth quarter was $16 2 million, which includes $8 8 million.
Gene Mieles: We reported research and development expenses of $7.4 million. Our gross R&D spending in the fourth quarter was $16.2 million, which includes $8.8 million that was billed to our OEM customers and is treated as contra R&D expense. Our G&A expenses were $10.6 million.
Bell to our OEM customers and is treated as contra R&D.
Our G&A expenses were $10 6 million.
The full year of 2023 cash used in operation was.
$56 4 million and capital expenditures.
$14 8 million, we ended 2023 with $332 million and liquidity are strong balance sheet will support the company as we maintain on track to achieve our commercialization milestone.
Gene Mieles: For the full year 2023, cash used in operations was $56.4 million, and capital expenditures were $15.8 million. We ended the year 2023 with $332 million in liquidity. Our strong balance sheet will support the company as we remain on track to achieve our commercialization milestone. For the full year 2024, we expect cash usage from operations to be in the range of $90 to $100 million, and capital expenditures in the range of $20 to $30 million. We expect total cash usage for the year in the range of $110 to $130 million.
For the full year of 2024, we expect cash usage from operation could be in the range of 90 to 100 million and capital expenditures in the range of 20 to 30 million.
We expect total cash usage for the year in the range of $110 million to $130 million.
Priorities for 2024, expanding our to attract top talent to support our strategic goals Cheetahmail laid out earlier.
Production capacity to deliver lithium metals out through our EV and brand partners.
And invest in the use of AI for it.
Actual material discovery as we stay at the forefront of battery material Science innovation.
We're very thankful for all the support we have received from our customers partners and shareholders.
Gene Mieles: Priorities for 2024 spending are to attract top talent to support the strategic goals Chi-Tao laid out earlier, build production capacities to deliver lithium metal cells to our EV and UAM partners, and invest in the use of AI for electrolyte material discovery as we stay at the forefront of battery material science innovation. We are very thankful for all the support we have received from our customers, partners, and shareholders. With that, I will hand the call back to the operator to open up for questions. We will now begin the QA session. If you would like to ask a question, please press star followed by one on your touchtone keypad. If, for any reason, you would like to remove that question, please press star followed by 2.
With that I will hand, the call back to the operator to open up for questions.
We will now begin the Q&A session.
If you would like to ask a question. Please press star followed by one or you touched on key pad.
For any reason you would like to remove that question. Please press star followed by Tim again to ask a question press Star one.
As a reminder, if you are using a speakerphone. Please pick up your handset before asking your question.
Our policy of briefly to allow questions to Jim Alright. Thank you.
The first question comes from the line of Winnie Dong with Deutsche Bank. Please proceed.
Hi, Thank you so much for taking my questions.
First as a clarification. It seems like you are now targeting to E. Comm the lines I just wanted to clarify a business or.
One JV partner or if it's like two I think you sort of hinted at that.
Battery day and.
Operator: Again, to ask a question, press star 1. As a reminder, if you are using a speakerphone, please remember to pick up your handset before asking your question. We will pause here briefly to allow questions to generate in the queue. The first question comes from the line of Wendy Dunn with Deutsche Bank. Please proceed. Hi, thank you so much for taking my questions.
And then you can also remind us.
What we can anticipate.
The assembly process timeline on.
When it could potentially conclude thank.
Thank you.
Yeah.
Yes.
Lastly, we announced one be simple and then to one and that we are prepared to one be sample in line. So that would be simple J D.
And then we are.
Working with at least one other OEM.
OEM car maker to potentially.
Wendy Dunn: First, a clarification. It seems like you're now targeting two vSanbo lines. I just want to clarify if this is for one JVM partner or if it's like two. I think you've sort of hinted at that in battery day. And then, you know, what we can expect in the vSanbo process and the timeline on when it could potentially conclude. Thank you.
The tissue side.
Second piece simple J D and this is why we are preparing.
Second line and then later this year we mined.
Having to be simple lines, and operator to be simple lines and then in terms of timing, we expect to be simple development will take about 18 months. So this year.
'twenty 'twenty four and until mid next year.
Got it thank you so much.
Chi-Chau Hu: Yeah, Winnie, so last year, we announced one B-sample, and then we were preparing one B-sample line for that B-sample JDA. And then we are working with at least one other OEM carmaker to potentially introduce a second B-sample JDA. And this is why we are preparing a second line. And then later this year, we might end up having two B-sample lines and operating two B-sample lines. And then, in terms of timing, we expect the B-sample development to take about 18 months. So this year, 2024, and until mid-next year. Got it. Thanks so much.
And more on that.
I think some of them may not be entirely familiar with.
Ladies and that application.
The developmental pathway that you mentioned.
Oh that sounds like actually equivalent to commercial production on background.
So I was wondering if you can maybe elaborate a little bit more on that and potentially grow.
How many partners are you actually working with currently.
Yeah that's.
Good question, so with <unk> you have this.
Sort of Cliff basically after be simple and see sample and then do you have to get to at least 10 gigawatt hours.
Chi-Chau Hu: And then, I think some of us may not be, you know, entirely familiar with the UA Invest application and then the, you know, the developmental process that you mentioned on the call that the B-Sample is actually equivalent to, you know, commercial production on that front. So I was wondering if you could maybe elaborate a little bit more on that and potentially, you know, disclose how many UA Invest partners you are actually working with currently? Thanks. Yeah, that's a good question.
Basically from less than one kilowatt hour all the way to <unk> and then if you don't have.
More than 10 gigawatt hours and it's really hard for you to get any meaningful commercial contract.
And then for <unk> is different because Julian is actually still in the process of ramping up and then.
Several companies.
Their volume currently are small we're talking about single digit number of aircrafts per year.
Chi-Chau Hu: So with EV, you have this sort of cliff, basically after the B sample and then the C sample, and then you have to get to at least 10 gigawatt hours, basically from less than 1 gigawatt hour all the way to 10 gigawatt hours. And then if you don't have more than 10 gigawatt hours, then it's really hard for you to get any meaningful commercial contract. But then for UAM, it's different because UAM is actually still in the process of ramping up. And then several companies in the UAM, their volume is currently small. We're talking about a single-digit number of aircraft per year.
So that's actually a very good opportunity for us because then we'd be sample line even.
Even fully optimize any sample line, we can produce at least 1000 cells per month, and 1000 cell Isabel two aircrafts worth of batteries so per month.
Obviously.
Considering yields on that stuff, we can make one or two aircrafts worker batteries, that's not very meaningful for EV, but then for UAS essentially very meaningful and then we're able to supply to them not only for testing.
Chi-Chau Hu: So that's actually a very good opportunity for us because then our B-sample line, even a fully optimized A-sample line, we can produce at least 1,000 cells per month. And 1,000 cells is about two aircraft' worth of batteries. So per month, and obviously, considering yields, all that stuff, we can make one to two aircraft's worth of batteries. That's not very meaningful for EV, but then for UAM, it's actually very meaningful. And then we're able to supply them not only for testing, but later for FAA qualification, certification, as well as commercial because EV is already a big market, which we continue to focus on, and that is still the core focus. But then UAM, because it's a small market and it's just ramping up, we can actually ramp up our battery capacity along with UAM's ramp-up. Okay, that's very helpful.
But then later for FAA qualification certification as well as commercial because because EV is already a big market, which we continue to focus on and that is still the core focus for the union because it's a small market.
It's just ramping up we finished your brand pump our bedroom capacity along with uhm ramp up.
Okay, that's very helpful.
And then maybe on the Capex spending of 20 to 30 million for this year I was wondering if you can delineate how much of that goes into automotive.
And I think also for 'twenty.
<unk> ended the year with quite quite a bit lower capex and targeted.
So I guess why do you Didnt get spend and then if you can also comment on the.
The capital question.
Driving a much lower spending that'd be helpful. Thank you.
Yes.
I didn't give a little color.
Yeah.
Okay got it.
I should have been.
Gene Mieles: And then maybe on the CapEx spending of 20 to 30 million for this year, I was wondering if you could delineate, you know, how much of that goes into automotive versus UAM. I think also for 2023, you ended the year with quite a bit lower CapEx than targeted. So, I guess, what do you think gets spent? And then if you can also comment on maybe capital efficiency and what's driving the much lower spending, that would be helpful. Thank you. Yeah, I didn't do all the colors.
So to answer your first question.
This year's guidance.
Most of the cash hit the <unk> line.
I got to spend some money too.
Changed one of our current example activity that it hit it UA analyzer, but a portion of the Capex is that relatively small question adult all.
Capex spending.
And.
Your second question on last years.
Lower spending than our guidance.
Gene Mieles: Okay, yeah, got it. To answer your first question, of this year's guidance, most of the cash is on the EB sample lines. We are going to spend some money to change one of our current sample lines to be dedicated UAM lines, but that portion of the CAPEX is a relatively small portion of the overall CAPEX spending. And your second question, on last year's lower spending than our guidance, most of the lower spending is due to just cost control and both on the DNA and some R&D aspects to try to be very prudent with our cash. So, a lot of the OPEX part of the saving is permanent. And then on the CAPEX side, we were pushing out some of the PO process for the B sample line that Chital talked about. So, that was a timing issue that was pushed out from last year to this year. So, we're placing the PO, we're still going through the value evaluation process, and we'll place a PO for the B sample line this year. So, it's partially timing, but largely a permanent reduction; please feel free to add.
Most of them most of our spending is due to a J.
Thanks, Paul and welcome the DNA and some R&D.
As to try to be very prudent with our cash.
A lot of the Opex part of the thinking as permanent and then on the Capex side.
We're pushing out some of the.
Appeal process for the <unk> mine that <unk> talked about.
That that was a timing issue.
That was pushed out from.
So we're placing a P O.
Thanks, you would've gotten their evaluation.
On top of that then what place whether it be handle line this year.
So it's partially a timing largely permanent reduction on that.
So please feel free to add.
Yes. So the focus is definitely on automotive and then most of the Capex. This year will be on the building and operation to be simple lines. Later this year and then for you and basically what it is taking an old example mine and then converting them to you in but the focus on the development of the new stuff.
Chi-Chau Hu: Yeah, Winnie, so the focus is definitely on the automotive industry, and then most of the CAPEX this year will be on the building and operation of two B-sample lines later this year. And then for UAM, basically, we're just taking an old A-sample line and then converting that to UAM. But the focus, all the development, all the new stuff will definitely take place on the automotive B-sample line. Got it. Thank you so much for taking the time to answer my question.
Well definitely take place on the automotive business lines.
Got it. Thank you so much for taking my question.
Okay.
Okay.
Yeah.
Yes.
Okay.
Okay.
Operator are there any further questions on the in the queue.
Operator: Thank you. Operator, are there any further questions on the queue? Operator, are you there? Excuse me, can you hear me?
Okay.
Operator are you there.
Okay.
[music].
Excuse me can you hear me.
I can hear you now yes I can.
Operator: I can hear you now. Yes, I can. Yes, we will take the next question coming from the line of Sean Severson with Water Tire Research. Please proceed. Don Severson, please verify that you're not on mute.
Yes, we will take the next question comes from the line of Shawn Harrison with waters higher research. Please proceed.
John services, please verify that you're not on mute.
Operator: There are no additional questions at this time. I will pass it back to Cal Pinkleton for any additional remarks. Thanks. We did receive a few pre-submitted questions by virtue of a questionnaire we made available to investors ahead of the call, and at this stage, we'll take a selected number of the questions which were submitted by investors for our CEO, Chi-Chau Hu.
There are no additional questions at this time I will pass it back to Cal <unk> for any additional remarks.
We did receive a few pre submitted questions by virtue of a questionnaire. We made available to investors ahead of the call and at this stage will tick a selected number of the questions, which were submitted by investors for our CEO of <unk>.
Cal Peckleton: The first question is, when will the first commercial battery production be available on the market? Yes, I think for UAM, and as we mentioned earlier, UAM is a nice beachhead, a stepping stone to EV. So for UAM, we're targeting the first half of 2025. And for EV, we're targeting, likely, the second half.
The first question is when will the first commercial battery production be available on the market.
Yes, I think for you in <unk>.
As we mentioned earlier helium is a nice beachhead as a stepping stone to EV. So for you of embryo targeting per sample to be 25 next year.
And for <unk>, we're targeting.
Thank you the second half of next year.
Yeah.
Chi-Chau Hu: Great. The next question we got from investors ahead of the call is, what are the key challenges to scaling the lithium metal anode in production when it comes to notching and stacking? Yes, we actually covered this in previous earnings calls. So the material itself, lithium, and especially lithium on copper, is quite thin and quite weak.
Great.
The next question, we got from investors ahead of the call is what are the key challenges to scale with the <unk> metal anode in production when it comes to Notching and stacking.
Okay.
Yes, we actually cover this in previous earnings calls so the material itself lithium and the especially with lithium on copper is quite.
Thin and then play a week and if you use conventional processes like laser or metal die punching you actually don't get very good results and then you end up with lots of issues.
Chi-Chau Hu: And if you use conventional processes like laser or metal die punching, you actually don't get very good results, and then you end up with lots of issues like powders or tearing. And also, making large sheets with very thin lithium foil is also very difficult. And then you end up with wrinkles.
Powders or Terry and also making large with very soon lithium foil is it's also very difficult and then.
Now with wrinkles and then we actually work with several partners.
Chi-Chau Hu: And then we actually worked with several partners and tried different techniques from extrusion, lamination, to just coating. And eventually, we actually settled on one process. And then, In the early days, we used to have the vendors make it for us, but then we realized it was hard to control the quality, so then we took this in-house, and then we were able to improve the quality and the product a lot faster.
And tried different techniques from extrusion lamination to just coding and eventually we settled on one process and then.
In the early days, we used to.
Half the vendors make for us, but then we realized it was hard to control. The quality. So then we took this in house and then we're able to improve the quality and the product a lot faster.
Chi-Chau Hu: Great. And the final question we'll take from the pre-submitted questions from investors is, how will you use artificial intelligence to advance battery technology? So for us, it's really two parts.
Great.
The final question, we'll take from the pre submitted questions from investors is how will you use artificial intelligence to advanced battery technology.
So for US, it's really two parts, one or two sure safety and anytime you have a new battery technology, especially one that has very high energy density and then, especially Europe be simple and then see sample and then very soon commercial.
Chi-Chau Hu: One is to ensure safety. And then any time you have a new battery technology, especially one that has very high energy density, and especially your B-sample and the C-sample and then, very soon, in commercial use, the consideration around safety becomes quite different. And then we're not talking about just paper safety, but we're talking about, can you put this battery inside a car or inside an aircraft and, in actual usage, is it safe? And then also what happens when the worst happens.
The consideration around safety becomes quite different and we're not talking about just just paper safety, but we were talking about can you put this battery incentive car or is on the aircraft and in actual users is it safe.
And then also what happens when the worst happens so.
So the.
Chi-Chau Hu: So the use of AI, basically by collecting manufacturing quality data, because quality is safety. A lot of the issues that happen in quality will directly result in incidents. And also, collecting actual live vehicle data. Then we can actually predict the incident and then have a very accurate monitoring of the battery health. And then we can actually predict the incidents before it happens.
Use of AI basically by collecting the manufacturing quality data because also policy is safety issues that have been quality will directly result in incidents and also collecting actual live vehicle data. Then then we can actually.
<expletive> the incident, and then have a very accurate.
Monitoring of the battery health and then we can actually predict the incidents before that happens. So this becomes really important and then it's really important to give Oems the confidence there.
Chi-Chau Hu: So this becomes really important, and then it's really important to give OEMs the confidence that yes, it's a new battery technology. Yes, it has higher energy density than other battery technologies, but it's actually safe because we can make it safe with the use of this Avatar AI. And then the other part is using this for future material development. And then that's when we try to improve performance, cycle life, energy density, safety, and then for future roadmaps, roadmap material development. And this AI really allows us to screen a lot more candidates much more quickly, excellent. Thanks. I'll turn it back to the operator. Operator, are there any additional questions in queue at this stage? Yes. The first question comes from the line of Sean Severson with Water Tower Research. Please proceed. Well, good afternoon, everyone. Try this again. Can you hear me now?
Yes, as the new better technology, Yes, he has higher energy density than other better technologies, but et cetera, safe because we can make it safe with the use of this advertising.
The other part is using this for future material development and then that's when we try to improve the performance cycle life and as density safety and therefore future roadmap roadmap.
Hello, Matt.
Material development and this really allows us to screen a lot more on Canada's much faster.
Excellent.
I'll turn it back to the operator, operator are there any additional questions in queue at this stage.
Yes. The first question comes from the line of Shawn Severson with Watertown Research. Please proceed.
Good afternoon, everyone I'll try this again can you hear me now.
Operator: I can hear you. Hello. Yes. Okay. Good. All right. Just make sure.
I can hear you well.
Yes, Okay, just making sure.
I was.
Sean Severson: I wanted to talk about the B sample push in 2024 and how that reflects itself in terms of milestones or events over the next 12 to 18 months that are going to be able to provide kind of progress reports and updates? So just trying to understand the news flow of data that comes out of this as you go through this B-sample push.
I wanted to talk about the B sample push in 2024, and how does that reflect itself in terms of milestones or events over the next 12 to 18 months that are going to be able to provide a progress report and update so just trying to understand the news flow and data that comes out.
This as you go through this.
<unk> sample push.
Yeah. The B sample itself, an entrant be simple itself is a big milestone rep.
Chi-Chau Hu: The B-sample itself and entering the B-sample itself is a big milestone. It represents that a new chemistry of lithium metal is no longer in R&D or just early stage engineering development, but it's actually in the B-sample. And then we're considering a lot from the perspective of the final vehicles. So some of the milestones would include, for example, we are setting up the line, and we will begin operating the B-sample lines. And then we expect that in the second half of this year, we will have the B-sample lines running.
It represents a new chemistry lithium metal is no longer in R&D, which is early stage engineering development, but it's actually in be simple and then we're considering along.
From the perspective of the final vehicles. So some of the milestones wooden pool. For example, we are setting up the line and we will begin operating the <unk> lines and then we expect second half of this year, we will have to be simple lines running.
Chi-Chau Hu: And then, in the first half of 2025, we will have data from cells coming off the B-sample lines. And then these cells will likely be different from the original designs in terms of product design. For example, some will have high nickel cathodes for the premium vehicles, while some will have LFP cathodes for the economy cars.
And then in the first half of 2025, we will have.
Data from the cells coming off the B simple lines and then the sales will likely be different from the original designs in terms of product designs could come with some will have high nickel cathodes for the premium vehicles. Some will have LLC titles for the economy cars and then and then also benchmark costs.
Chi-Chau Hu: And then also benchmark costs of LFP lithium metal with high nickel lithium ion batteries, just showing that these LFP lithium metal B-sample cells can actually be low cost but also achieve very high energy density. And then, yes, also in the first half of 2025, then the quality, the number of quality control points, the incident prediction, and then integrating the speed sample line with Avatar, just showing that the number of cells that we built and the number of quality checkpoints per cell, and then the product of the two, how this increased amount of data that we will have access to will help train Avatar and make Avatar more accurate. Great, thank you. That's very helpful. I have a lot of work to do. So the C-simple and Avatar, why should they tie together? That was kind of my next question about avatars and safety as well.
L F P lithium metal with high nickel lithium ion to showing the study's LCD lithium that'll be sample cells can actually be.
The low cost, but also achieved very high.
Energy density.
And then.
Yes so.
Also in the first half of trying to survive.
Quality the number of quality control points. The incident prediction and then integrating those be simple line with advertising. So it's showing that the number of cells that we built and the number of quality checkpoints per cell and then the.
Product over too.
How does increase.
Number of.
The amount of data that we will have access to how that will help train Africa, and then make avatar and more accurate.
Great. Thank you guys, so to be simpler and more in advertising.
Tie together.
That was kind of my next question was about avatars and safety as well.
Chi-Chau Hu: How, how differentiated is this 100% safety goal when you look at some of the other technologies and batteries out there and your conversations with OEMs? I mean, is this something that is very unique, you think, to SES and this goal and a realistic goal to achieve versus kind of versus what's out there today for options for OEMs? Yeah. So the goal, obviously, is a goal shared by almost all OEMs: a near 100% safety guarantee. And then, and then, And then this is really important because when you have a car or an aircraft out there, you need to make sure it's safe. So what's unique about SCS is that all this data is actually for lithium metal. And then Avatar AI. Any AI that I use is actually quite dependent on the quality of the data.
How how differentiated is this 100% safety goal when you look at some of the other technologies of batteries out there and we've had conversations with Oems.
This is something that is very unique you think to see asset that this goal is to be realistic goal to achieve versus kind of versus what's out there today for options for Oems.
Yeah. So the goal obviously is the goal sure by almost all Oems near 100 per center.
Safety guarantee and then and then.
And then this is really important because when you have a car or an aircraft out there for you to make sure. It's safe so what's unique about Ses is.
All of this data issue for lithium metal and then avatar AI and you add that use is actually quite dependent on the quality of the data and then no. One else has the amount of lithium metal data that we do and the reason actually actually we actually don't care about the the OEM JD as well the reason that we build it.
Chi-Chau Hu: And then no one else has the amount of lithium metal data that we do. And the reason, actually, we actually don't care about the OEM JDAs. The reason that we build these B-sample lines is to collect more data, to generate more data.
Simple lines is to collect more data as we generate more data so for us the be simple lines are alike.
Chi-Chau Hu: So for us, the B-sample lines are like a mine of data. So, no one else has these B-sample lines, and no one else has the quality and the quantity of lithium metal cell data that we do, so we can use all this data to train this avatar. So, our data is specific to lithium metal, and our avatar is specific to lithium metal, and so it's unique in the sense that no one else has access to the kind of lithium metal data that we do. Therefore, our avatar is the most accurate for lithium metal. Now, in terms of is this approach unique, it's also unique, because even if you look at lithium ion today, most OEMs still have access to car data, but they won't have access to battery data, or most car batteries – or most battery companies will have access to manufacturing data, but not car data.
A a mine of data.
So no one else has has these be centralized in and no. One else has the quality and the quantity of lithium metal cell data that we do so that so that we can use all these data to train the sabotage. So so our data are specific to lithium metal and our avatar is specific to lithium metal and then so so.
Unique in the sensor.
No one else has access to the kind of lithium all data that we do so our avatar is most accurate forward lithium metal now.
In terms of is this approach unique.
Also unique because.
Even if you look at lithium ion today, most Oems they will have access to two car data, but they won't have access to better data or most car better almost.
The better companies, what will have access to manufacturing data, but now car data, but then so what are you trying to do is as you integrate the battery manufacturing data with the card data and then this Patrick. This approach is also quite unique some larger companies are in the process of doing this but then but then because they have a.
Chi-Chau Hu: But then – what we're trying to do is actually integrate the battery manufacturing data with the car data, and then this – actually, this approach is also quite unique. Some larger companies are in the process of doing this, but then, because they have a large – And it's quite expensive for them to change, so they have not implemented this approach yet.
Large.
Inertia and then it's quite expensive for them to change to that.
They have not implemented this approach yet, but so for us it's unique because we have the highest quality and highest quantity of lithium metal data and also this approach of combining.
Chi-Chau Hu: So for us, it's unique because we have the highest quality and highest quantity of living metal data and also this approach of combining cell manufacturing and also vehicle data. Thanks. And my last question is regarding the UAM market, an opportunity. Obviously, you seem pretty excited about the opportunities, having some commercialization there. Can you help us understand how you think about the market, the development, and the commercialization there?
So manufacturing and also vehicle data.
Great. Thanks, and my last question is regarding the UAE market.
The opportunity obviously.
We're pretty excited about the opportunities having some commercialization there could you help us understand how you think about the market the development and commercialization. There I mean, obviously you know you were talking about very few units.
Chi-Chau Hu: I mean, obviously, you're talking about very few units but going out over the next year or so, but why does this make you excited when you look at this as being an important part of SESC? Yeah. So, I mean, the focus is on EV, and all the developments that we're doing are not really targeted at UAM. They are for EV. It's just that these batteries actually happen to have very good usage in UAM. And what's exciting about this is really two things.
And out over the next year or so.
Why does this make you excited when you look to this will be an important part of Ses's future.
Yeah. So I mean, our focus is on EV and <unk> and all the development that we're doing are not really targeted for U N. Therefore, EV is just that these batteries actually happen to have very good usage in UAE and it was exciting about this is it's really two things one is from the <unk>.
Chi-Chau Hu: One is from the customer perspective. So, UAM currently, this market doesn't really exist, or it's in a very early stage because without a high energy density, high power density battery, it's not practical. You can only carry two people, or you can fly for 10 minutes, less than 20 minutes. The whole market is not economical.
Customer perspective, so uhm currently.
This market doesn't really exist or it's very early stage because without a high energy density high power density battery.
Practical.
You can only carry two people or you can fly 10 minutes less than 20 minutes. The whole market is not economical, but with lithium metal. So you can carry more people you can carry more more payload and then you kind of try.
Chi-Chau Hu: But with lithium metal, you can carry more people, you can carry more payload, and then you can fly for longer; then the business actually becomes more economical. So, from the customer's perspective, UAM Lithium Metal really enables UAM, and that's why it's really exciting. And then from our perspective, because once we get the design in, once we go through all the qualification, all the testing, FAA certification, then this battery pack actually becomes FAA certified. And then you are there; you set the standards for many years to come.
For longer than the business as it becomes more economical so so.
From the customers' perspective uhm.
As a matter of really enables you add and then that's why it's really exciting and then from our perspective.
Because once we get designed in once we go through all the qualification of the testing the FAA certification due.
Then.
This battery this battery pack actually becomes FAA certified and then you are there you used you set a standard for.
Chi-Chau Hu: So from both the customer's perspective and also ours, it's a very good fit. And the volume is small, so we can actually produce using our B-sample lines and also A-sample lines. That's why it's a good fit in terms of a near.
Many years to come so from both a customer's perspective and also al perspective, that's a very good fit and an evolving is small so if we can assume as it produced using our be simple lines and also a simple lines. That's why it's a.
In terms of the near term.
Sean Severson: Great, thank you, that's very helpful. Thank you. The next question comes from the line of Jed Dorshmeyer with William Blair. Please proceed. You have Mark Shooter on for Jed Dorsheimer here today.
Great. Thank you that's very helpful.
Thank you.
The next question comes from the line of Jed door Schneider with William Blair. Please proceed.
He have mark shooter on for Jaguar Xiaomi here. Thanks.
Jed Dorshmeyer: Q-Chao, a question for you on the progress of the prismatic cells. That was one of the main takeaways from Battery World. I'm wondering, has there been any more progress there? Any other color on that?
<unk> a question for you on the progress of the prismatic cells that was one of the main takeaways from battery World I'm wondering.
Has there been any more progress there any other color.
Chi-Chau Hu: Any other, anything from the other JDA partners on the prismatic cells? Yeah, so the prismatic cell, we have made some progress. And we plan to update that in the second half of this year. And the prismatic cell is actually for one of the B-sample JDA partners. So they use the combination of LFP lithium metal in the prismatic format. We'll have more updates later this year.
Any other anything from the other JV partners on the prismatic cells.
Yes. So the present itself, we have made some progress and we plan to update that in second half of this year and the prison either sell it is actually for one of the be simple GDA partners. So they use the combination of <unk> lithium metal in the prismatic format.
We'll have more updates later this year.
Okay, great. Thank you.
Chi-Chau Hu: Okay, great. Thank you. Next, switching gears a bit to UAM. You talked about a 60% increase in energy density versus the incumbent. So if I take you know, around 700 watt hours per liter for traditional cells, which is a rough benchmark, are you looking to target over 1100 watt hours per liter for these cells? Is that a target you need for that B sample line?
Switching gears a bit to uhm.
You talked about a 60% increase and energy density versus the incumbent so if I take an hour and 700 watt hours per liter for traditional cells.
Rough benchmarks are you looking to target and over 1100 watt hours per liter for these cells is that is that a target.
Need for that B sample line conversion.
Chi-Chau Hu: Yeah. Right. So the current lithium ion battery, we're talking about 720-750 watts per liter and then 260-280 watts per kg.
Right so.
The current lithium ion returned about 720 750, <unk> wants to leader and then $2 62 81.
Chi-Chau Hu: So for the UAM cells, we're targeting at least 440 and higher watts per kg and 1100 to 1200 watts per liter. So these will have very high energy density at the cell level. Okay, and are there, you know, the latest 100 amp hour data was around 860 watt-hours per liter. So are there, what are the puts and takes there?
So for the UN sells were targeting at lease for 40 and higher loss per kg in the $1100 12 under what's called either so.
This will have very high energy density at the cell level.
Okay and are there the latest 100 empower data, whereas around eight.
860 waters later, so are there what are the puts and takes there that just general materials improvement or can you make tradeoffs.
Chi-Chau Hu: Is that just general materials improvement, or can you make trade-offs versus cycle life to achieve that? Right, so the UAM will not use the exact same cell design as the 100m-powered A-sample cell. So the A-sample and the B-sample EV cells are designed for long cycle life and then EV cycling conditions, typically silver III charge and discharge, 3-hour charge and discharge. But then for UAM, the cell designs will be different because we're going to target a much higher energy density, and then the charge and discharge profiles will be different. We're going to use relatively slower charging or battery swapping. This is one business model that we are actually discussing with several UAM customers. And also the UAM discharge profile. So takeoff, climb, cruise, descend, and then landing.
Cycle life to achieve that.
Right. So so the the uhm will not use the exact same cell design as the 100 empower the a sample cell. So the Asa nickel in the B simple EV cells. Those are designed for long cycle life, and then EV cycling conditions, typically silver three charge and discharge three hour charge and discharge.
But then for U a N a.
Then the cell designs will be different because we're going to target a much higher energy density and then the charge and discharge profiles will be different we're going to use relatively slower charged or battery swapping. This as one business model that we are at.
Actually discussing with several European customers and also the uhm discharged profile so take off a crime cruise design in their mind and also the.
Chi-Chau Hu: And also the depth of charge and discharge are different. So because of the difference in the UAM mission profile and the EV mission profile, we will design the cells differently. So the materials will still be the same, but then, for example, capital loading, and thickness of the lithium, the cell design will be different.
The depth of charter discharge are different so because of the difference in the UAE in.
Mission profile and the and the E V emission profile, we will design itself differently.
So the materials will still be the same but for example, catheter loading thickness of lithium.
The cell designs will be different.
Chi-Chau Hu: Got it. Thank you very much. Thank you. Thank you. Again, to ask a question, please press star 1. There are no additional questions left at this time. I will hand it back to Carol Pickerton for any closing remarks. Thanks. I'll turn it over to Chi Chou for any closing remarks before we end the call. Yeah, thanks, Kyle.
Got it thank you very much.
Thank you. Thank you.
Again to ask a question please press star one.
There are no additional questions left at this time I will hand the.
Back to Cao Pinkerton for any closing remarks.
Thanks, I'll turn it over to Chi Chow for any closing remarks before we ended the call.
Yes, I think so.
Chi-Chau Hu: Yes, basically, I just want to reiterate the three main focuses for us. One is our absolute focus on EVB sample JDA. We signed the world's first, and we expect to sign more later this year.
So basically I just want to reiterate the three main focus for US one is absolute focus on ABB sample JD, we send the world's first and we expect to sign more later this year. So the ABB sample and be simple lines will be critical to improve our manufacture ability and also generate more data.
Chi-Chau Hu: So the EVB sample and B-sample lines will be critical to improve our manufacturability and also generate more data. Second, we identify UAM as a stepping stone to EV, and we're going to deliver the first batch of UAM cells this year. And then third, we'll try to achieve near 100% safety prediction. And this year, our goal is 95%. And then we really want to improve the quality and quantity of our lithium metal cell data, both testing data as well as manufacturing quality data. So these are the three focuses, and I'm really excited about this year as we continue to make progress towards commercialization of lithium metal for EV and UAM and also integrate the use of AI as a core part of SES.
<unk> is we identify uhm as a steppingstone to EV and then we're going to deliver the first batch of UA himself. This year and then third is is we'll try to achieve.
Near 100% safety prediction and this year. Our goal is 95% and then we really want to improve the quality and quantity of public and metal sell data both testing data as well as the the manufacturing quality data.
So these are the three focus and then I'm really excited about this year and as we continue to make progress towards the commercialization of lithium metal for EV and Uhm and also integrate the use of AI.
Cal Peckleton: So, thanks. That concludes today's conference call. Thank you. You may now disconnect your line.
Core part of Lcs Bill Thanks.
That concludes today's conference call. Thank you you may now disconnect your line.