Dragonfly Energy completes U.S. lithium battery cell pilot line

Dragonfly Energy Holdings completed their U.S. lithium battery cell pilot line. Deploying the Company’s patented dry deposition manufacturing processes, Dragonfly Energy has begun using its pilot line to dry deposit working anode, at a level sufficient to support large-scale production. The Company believes the establishment of its pilot line and the successful production of anode marks a critical milestone for its goal of manufacturing battery cells domestically from its Reno, Nevada, manufacturing facility. Dragonfly Energy’s patented battery cell manufacturing processes are chemistry agnostic, meaning they can be applied to various uses, which is expected to enable the Company to expand into new markets over time and to achieve its goal of domestically producing nonflammable solid state battery cells. The processes allow the cells to be manufactured within a significantly smaller footprint and without the toxic solvent present in conventional cell manufacturing, which is expected to make the process not only more environmentally friendly but also more cost effective. Dragonfly Energy estimates this pilot line is capable of producing up to 150 MWh of domestically manufactured LiFePO4 battery cells per year when operating at 70 percent efficiency. The Company believes it can rapidly scale capacity with additional production lines as demand increases. Using its patented dry deposition processes, the Company has been able to significantly reduce the manufacturing footprint required to produce lithium-ion battery cells by replacing large, energy intensive equipment such as slurry coaters, conveyor dryers, and solvent reclamation equipment. The new pilot line requires less than 150 square feet of physical space per electrode and consumes less than 6 kW of power. This significant reduction in energy and space is expected to meaningfully reduce the environmental impact of future battery production compared to conventional manufacturing. Having demonstrated the scalability of the new manufacturing process with the production of anode material, the pilot line is expected to begin producing cathode material during the third quarter of 2023. With these important milestones, Dragonfly Energy expects to produce fully American-made battery cells from its pilot line in the fourth quarter of 2023. The Company expects to provide sample cells to potential customers at that time and expects to commercialize the cells by incorporating them into new Battle Born Batteries products during 2024. With a well-established brand and customer base, the Company believes it is in a prime position to be able to not only market American-made battery cells, but also incorporate them into its existing and future battery products, reducing the Company’s reliance on imported cells and vertically integrating its battery production.