Unveiling the Versatile World of Freudenberg: From Floor Mops to Battery Packs
What do coatings for M&M chocolate candies, O-Cedar floor mops, and battery packs for electric trucks have in common?
All three come from the German industrial conglomerate Freudenberg Group. This company operates many other seemingly incongruous businesses, from filtration to home cleaning products.
A History of Handoffs
Freudenberg’s battery business is a suitable topic for Truck Tech. However, it’s not as tasty as M&Ms, for which it provides the hard shell coatings through its Capol business unit.
The heavy-duty truck and bus battery cell and pack manufacturing plant located in Midland, Michigan, is a survivor of Dow Chemical’s 2013 exit from a joint venture known as Dow Kokam.
Freudenberg ePower Systems operates in Midland, Michigan, after several name changes. (Photo: Freudenberg)
Dow determined the battery business wasn’t worth pursuing, but it continues to produce materials for batteries. South Korea-based Kokam Co. has been partly owned by private equity and real estate investor Townsend Ventures since 2008. Dow held 50.1% of Kokam when the joint venture with Townsend formed in 2009.
Back then, both established companies and startups invested heavily in powering electric vehicles, but the slow adoption of EVs forced several to close their doors.
After Dow sold its stake in Kokam to Townsend, the business was renamed Xalt Energy. In 2018, Freudenberg purchased 50.1% of Xalt, acquiring the rest in September 2023, rebranding as Freudenberg e-Power Systems.
Diversification Play
“Freudenberg decided to enter the battery industry for product diversification,” said Lisa McKenzie, president and general manager of Freudenberg e-Power Systems. “We’ve always focused on the heavy-duty market... let’s say the more niche markets, which heavy-duty still kind of is.”
Lisa McKenzie, president of Freudenberg’s ePower Systems (Photo: Freudenberg)
Freudenberg boasts $12.5 billion in 2023 total revenue, contrasting with some financially constrained competitors like startup Romeo Power, whose battery pack manufacturing assets, previously owned by Nikola, were sold to Mullen Automotive in September 2023.
The Proterra Powered battery business went for $210 million to Sweden’s Volvo Group in its parent’s bankruptcy auction in November 2023.
McKenzie explained that Freudenberg’s ability to design battery cells and the packs that contain them sets it apart from competitors that only offer packs.
“It helps to provide the pack team with all necessary information about that cell to design around it, optimize performance, and ultimately keep it safe,” she said. “Having that all under one roof is one of our unique strengths.”
Challenges Facing Battery-Powered Trucks
Freudenberg is realistic about the hurdles facing battery adoption for heavy-duty trucks. Energy density—how much charging power a battery provides—is chief among these challenges. The company has explored chemistries like sodium but found it’s not yet ready for prime time.
“We’re open to developing products with companies possessing novel technology,” McKenzie said. “We’ve had many conversations with organizations that have excellent PowerPoint presentations. But when we try to delve into their data, they’re not there yet.”
Freudenberg ePower Systems batteries in Midland, Michigan (Photo: Freudenberg)
While lithium iron phosphate (LFP) chemistry is broadly supported industry-wide, NMC (nickel, manganese, cobalt) lithium-ion chemistry is progressing in enhancing energy density.
“Now, there are cell-to-pack concepts, trying to remove as much of the structural or non-energy components from the battery pack to maximize energy output,” she said.
But the key to better batteries lies in designing vehicles specifically for battery packs. Most efforts today retrofit internal combustion engine designs, McKenzie noted.
“Trying to place battery packs on rooftops or beneath vehicles isn’t efficient. It works, but it’s not the most efficient.”
Avoiding Battery Fires
Then there’s safety, with which McKenzie is very concerned. Battery fires receive significant media attention, much more than traditional internal combustion engines powering most cars and trucks.
The euphemistic term “thermal runaway” has affected several OEMs in the early phases of Class 8 battery-electric trucks. Nikola, Volvo, and Freightliner have all recalled trucks for potential or actual battery fires.
McKenzie questions whether LFP is safer than NMC chemistry.
“NMC has a poor reputation currently, which I think is somewhat undeserved,” she said. “As long as you have a well-designed cell, manufactured with quality, a good BMS [battery management system], and a robust battery pack design, then NMC is just as safe.”
Cummins Inc., Paccar Inc., and Daimler Truck North America are investing $2 billion in building an LFP cell manufacturing plant in Mississippi.
“LFP has been heavily promoted, but it too can enter a thermal runaway situation,” McKenzie warned. “It’s not completely safe.”
Tipping the Scales for RNG
California’s recent amendments to the Low Carbon Fuel Standard give renewable natural gas (RNG) an edge over other drop-in fuels.
These changes help establish RNG as a transitional fuel in California, where the state is pressuring for all-electric commercial vehicles within the coming decade. The California Air Resources Board recently added $35 million to the electric truck purchase incentive scheme, including $5 million for the Zero Emission Truck Loan Project.
“The CARB LCFS amendments capped the use of soy and corn oil for renewable diesel production,” said Allen Schaeffer, executive director of the Engine Technology Forum. “This will compel fuel producers to find alternative, possibly more expensive, feedstocks.”
CARB’s carbon intensity reduction targets—20% by 2030, 90% by 2045—favor fuels like RNG. A CARB mandate requiring dairies to manage methane emissions could further boost RNG production.
Approximately 98% of the natural gas sold in California now comes from renewable sources like landfill gas, wastewater, and dairy waste.
Hexagon Agility Sees Future LCFS Benefits
“Overall, we view the LCFS amendments as a positive outcome and reinforcement of CARB’s endorsement of RNG,” said Ashley Remillard, Hexagon Agility’s senior vice president of legal and government affairs.