Cox Automotive, which operates used-car auctions and tracks car trade-in values, bought a battery recycling startup called Spiers New Technologies as it seeks to cash in on growing electric car sales.
Cox, which owns car-shopping sites Kelley Blue Book and Autotrader, didn’t disclose how much it paid for Spiers. The Oklahoma City-based startup helps automakers repair, replace, or recycle EV batteries when consumers bring them in to dealerships for service. It works with most carmakers, including General Motors Co., Ford Motor Co., Stellantis NV, Toyota Motor Co. and Nissan Motor Corp., according to founder Dirk Spiers. It doesn’t work with Tesla Inc.
Battery recycling could become a big business — by 2030, the world’s drivers are expected to buy almost 26 million EVs a year, and junkyards will take in almost 1.7 million metric tons in scrapped batteries, according to BloombergNEF. In the U.S., battery-powered vehicles will make up 30% of new car sales by 2030, according to IHS Markit.
Cox used data from Spiers to create a software algorithm that estimates the value of an electric vehicle based on the health and longevity of the battery. It plans to incorporate that tool into its car-shopping sites to help consumers value used EVs more accurately, said Lea Malloy, head of research and development at Cox Automotive’s mobility unit.
“Electric vehicles transact at about a 10% discount to their combustion peers, because consumers are skeptical about the health of the battery,” Malloy said. Instead of miles on the odomoter, Cox’s method looks at “how much energy goes into and out of battery, and at what speed and what temperature.”
Cox also plans to build battery service centers across the U.S. and in Europe to complement its existing network of about 75 Manheim car auction sites in the U.S. The centers will service and store batteries, as well as refurbishing and repairing them. They will also carry out root-cause analysis of battery failures. They could support individual car owners and electric commercial fleets, said Joe George, president of Cox Automotive’s mobility unit, which made the acquisition.
Cox Automotive is a subsidiary of Atlanta-based Cox Enterprises Inc., a century-old company that started out owning newspapers in the late 1890s. Combined with its auto and cable holdings, Cox claims $20 billion in annual revenue.
© 2021 Bloomberg L.P.