Around thirty years ago, three engineering students took a small combustion micro car apart and put an electric drivetrain into it. They designed the inverter and the motors themselves, tested them on a bench, then fitted them to the car. The first drive ran off a cable from a generator. When that worked, they fitted lead acid batteries and discovered, in Frank Blome's words, that this is not a good solution.
Nobody believed in electric vehicles then. Blome is careful to name the exceptions, and there are only a handful.
He is now the chief executive of PowerCo, Volkswagen Group's battery company. The distance between those two points is the interesting part of his story, because most of it was spent working on a product that was technically sound and commercially early.
Being right too soon
After the student project came the powertrain years: inverters, motors, and the first lithium-ion battery systems for hybrids. Then cell production, at a point when the market for cells did not yet exist in any meaningful volume.
Blome's account of that period is unsentimental. The product was good. The quality was good. It was also very early, and the Japanese, Korean and Chinese manufacturers were already producing at scale for laptops, phones and consumer electronics. That scale showed up in their prices. Producing at low volume against competitors who were producing at high volume is not a fight you win on quality.
His summary of the outcome: from a business point of view, it was not a successful adventure. His summary of the same asset today: it would be worth a great deal.
That gap between technical success and commercial timing runs underneath everything else he says. It is why he joined Volkswagen. His reasoning was simple. If electric vehicles were going to happen, he wanted to be somewhere that did mass production.
Building the competence before building the plant
What Blome did first at Volkswagen was not build a factory. He built the Center of Excellence for Batteries: hiring, test benches, buying cells from wherever in the world they were available, assembling battery systems in-house, and putting them into cars. The ID.3, the ID.4, the Taycan, the e-tron, Skoda and Cupra models.
Charging infrastructure came with the job, and it was new to Europe in a way that is easy to forget now. Nobody except Tesla had anything comparable. Specifications had to be written so that every car would work at every charging station, which meant collecting the relevant competence from across the Volkswagen brands and pointing it at a single outcome.
Only after that did the cell work start, with a small pilot line and development centre in Salzgitter. The site matters to the story. Salzgitter is a traditional combustion engine location, and the transition there meant moving buildings, people and skills into cell manufacturing rather than starting somewhere new. PowerCo came out of that in 2022, with a mandate to develop and produce battery cells at scale.
The first cells from the large Salzgitter plant are due this year, with Spain and Canada following, roughly one plant every other year.
Why one cell format
The decision Blome returns to most often is the unified cell: a single format, carrying different chemistries for different applications, producible in every PowerCo plant.
The reasoning is about risk rather than elegance. A cell plant is an enormous, inflexible investment. If you build it around a product tied to a particular car and that car does not sell, you have a problem that does not resolve itself. The unified cell breaks that link. If one model outsells another, PowerCo can still supply the cells. If the chemistry roadmap moves, the plants can produce the new chemistry.
He compares it to the module and platform logic Volkswagen has long used for combustion engines and axles, and credits the wider group, and Thomas Schmall in particular, with pushing it through. His own framing is that it makes the investment pay back regardless of what changes in the car strategy above it.
The other half of the same argument is about being a fast follower. Blome accepts the label and is clear about what it demands: a fast follower has to do a great many things right, and better than the companies already in the business. That means getting the technical roadmap right and being quick and reliable at delivering samples into test benches and cars.
The point of Line Zero
Which is why PowerCo's first production line went up in China, using almost entirely Asian equipment. Blome describes the competence available there as genuinely impressive, and the practical benefit was speed: build the line, scale it, get product into test fleets, all in a short window.
The commercial logic underneath is worth stating plainly, because it explains a lot of behaviour in this industry that looks impatient from the outside. Until you can show, in a car, that your product is reliable and hits the right cost, nobody will release it and nobody will buy it. Getting to that proof point quickly is not a vanity milestone. It unlocks everything downstream.
Solid state, and what still has to be proved
PowerCo's definition of solid state is stricter than the common one. A cell without liquid electrolyte is not enough. Going down that path properly means a lithium anode and no graphite at all.
The advantages follow from that. Weight comes down. Cost can come down too, because you are no longer paying for graphite, though Blome adds the necessary caveat that if the rest is not done right the other components eat the advantage. Charging improves, because lithium no longer has to travel into the graphite.
PowerCo is industrialising this with QuantumScape now, with teams working together on site. Blome's assessment is measured in a way that is unusual for the topic. The proof of concept has been shown, and he says he strongly believes in the technology because it is genuinely remarkable to see it working without graphite. What remains is quality, production system and cost, plus how the cell holds up under stress, since higher energy density raises the bar on thermal propagation and related behaviour. He would not give a date, but said PowerCo may be able to announce how it moves on within the next year.
Alongside it, PowerCo is producing its own LFP cells for affordable vehicles, with fast-charging LFP on test benches charging in around ten minutes, and discussions under way with the car side about when to bring it.
Dry coating, and the rare case where everything improves at once
Most process changes trade one thing against another. Blome singles out dry coating as an exception, and the list of what it improves is why PowerCo is working on it with Koenig & Bauer.
The machinery is simpler, so the process is less complex, so quality improves and scrap falls. The machines use considerably less energy. And it avoids chemicals that PowerCo wants out of the product anyway. Every one of those also reduces cost. Less energy is less cost, less critical chemistry is less cost, less scrap is less cost.
He is visibly pleased that this is happening with a German supplier, and makes a broader point about it. The history and the high-volume machinery production sit in Asia, but new technologies change the picture, and European machinery companies have a way back in through them.
What the board actually talks about
Roughly 80% of what the PowerCo board discusses in its weekly meetings is cost.
That figure is the most useful thing in the conversation, because it corrects an impression. Cells are the single largest block of value in a car, so a product that is more expensive and only slightly better is a difficult proposition. Performance and quality and lifetime have to meet the specification. Then you have to show up with a cost structure that works. Blome calls this standard automotive business, and he means it as a description rather than a boast.
He is also specific about the downside. A cell plant running high scrap rates takes years to recover in margin, and he has watched that happen over the last twenty years. It goes into the balance sheet and, in his words, probably never comes back.
On Europe
Blome thinks a mass production carmaker has to understand battery technology and hold at least part of it in-house, because the battery now determines customer satisfaction the way the combustion engine used to: charging performance, acceleration, weight, range. Cost matters more than it ever did for engines and transmissions.
He does not think PowerCo should supply 100% of Volkswagen's volume, and says so directly, adding that he would love the business but that getting there within ten years would be close to impossible anyway. It is competence, speed and money at the same time.
On why the technology sits in Asia, he is matter-of-fact. Asia invested heavily and early, with government funding, tax relief, free electricity, free buildings. There is no European mechanism that balances that out. So Europe has to do a number of things considerably better to become competitive. He thinks it is on a good way, which from someone who spent a decade building cells too early reads as a considered judgement rather than optimism.
This piece draws on the full conversation, which is available with a complete transcript on the episode page.