Media Watch - NVX related, page-11365

I think it’s important to stand back & look at the sequence of events over the past few years because it changed the course of action for Novonix.

Dec 2019 : Samsung SDi 500t supply contract signed.
Jan 2020 : Sanyo engage in MOU for material evaluation.

Dec 2020 : Harper International entered into a Strategic alliance for New Generation Furnace technology.
Jan 2021 : $5.57m grant from DOE to help fund $11m project for High Efficiency Furnace technology.
This is the collaboration to design & build Gen 3 Furnaces, This also involved Phillips 66 as the precursor supplier (prior to them investing in Novonix).
Project : DE-EE0009429 Dated 17/05/2021

Mid 2021 Sanyo & Samsung would be expecting samples from Gen 2 equipment. (Increased order to 2000t in Samsungs case).
This was also at the heart of COVID so disruptions affected labour & shipping/transportation worldwide.

This is where things changed.

It’s not logical Samsung would continue with their order considering Novonix were now in discussions for new furnace technology.
A logical decision would be to pause production until the product can first be internally validated using those new Gen 3 furnaces. It’s not rocket science, it just makes sense.
Also, even if the order did proceed, 2000t is hardly a realistic order from a Tier 1 Battery manufacturer let alone Gen 2 furnaces not being capable of producing anything beyond that volume without tying up all their future testing capacity so a decision was made not to further invest in Gen 2 Furnaces but still send samples for testing.

Gen 3 Design & Build appears to have taken Harper approximately 12 months.
Setting up of the furnaces including the Milling & Pulverising equipment, also including product testing to be able to validate a sample product to send to customers would take approximately 12 months.
Overall roughly 2 years which I consider more than acceptable. They’re not making pencils, this is high tech industry and Novonix are right at the heart of it so quality control is paramount.

IMO Big Blue (Riverside) was never going to achieve mass production capacity from 2023-2025. Obviously easier to say that in hindsight but logically it would’ve created it’s own problems.
I see Big Blue as more of a mass Production testing Plant.
This is where Novonix will complete internal validation at mass production level for each particular Anode product.
All processes are simply recorded & replicated at the next chosen production site, in this case likely to be Greenfield Chattanooga.
I estimate over time Novonix will be producing between 5-7 different Anode products so they need to have a mass production test site & Big Blue suits that purpose.
It will also cater for the Kore contract until it outgrows the facility.

Most of us understand there are existing contracts with Chinese Synthetic Graphite producers so it was unlikely a Tier 1 company would sign into a large volume supply contract with a small company with a new product using untested equipment.
Many of those contracts will be up for renewal 25/26 so this has been well timed to take advantage of the biggest growth stage. Also factoring in the increased tax credits & the potential graphite tariff being reintroduced that will have more of an affect from 2025 on.

So after a painful 2 years Novonix can finally send mass production samples from equipment they will be using now & in the future (Gen 3 Furnaces).
These next 4 months should see a contract signed, my guess is still Panasonic but there’s a handful in the running so we will wait patiently until an announcement comes.