Shulou(Shulou.com)12/24 Report--

In the past two years, the production capacity of power battery has increased rapidly.

According to the China Automobile News, news of the start of power battery projects or industry investment and financing will be reported almost every week at the end of 2022. Existing power battery companies, such as BYD, Ningde era, China New Airlines, Yiwei Lithium Energy, Guoxuan Hi-Tech, Honeycomb Energy, Funeng Technology, Xin Wanda, and Ganfeng Lithium Industry, have announced plans to expand production in the past year.

As a result, there is a large gap between the output of power batteries and the amount of cars installed today. According to data from the China Automotive Power Battery Industry Innovation Alliance, from January to October this year, China's cumulative production of power and energy storage batteries was 611.0GWh, an increase of 41.8 percent over the same period last year, while the number of power batteries installed was 294.9GWh, an increase of 31.5 percent over the same period last year.

From January to November 2023, the capacity, installed capacity and year-on-year growth rate of power batteries: in this context, the competition in the power battery industry is fierce. According to the survey of Hongxing Capital Bureau, some small and medium-sized power battery enterprises have difficulties in survival, or even shut down production. Therefore, the worry about the overcapacity of power batteries has become the focus of public opinion from time to time over the past year.

What is the future of the power battery industry? will it really fall into the "trap" of overcapacity?

In fact, the research on the capacity and demand of power batteries in China should not only pay attention to the Chinese market, but also need to pay attention to the global market. At the Global New Energy and Smart vehicle supply chain Innovation Conference in 2023, Zhang Yongwei, vice chairman and secretary-general of the China Electric vehicle Association of 100, said that at this stage, about 70% of the global battery capacity is in China, and the big market driving its future is still an important development area.

The China Electric vehicle Association of 100 recently released a report on "Innovation-driven New Generation Battery Development" (hereinafter referred to as the report), which has been expanded and updated on the basis of previous research. among them, the future development of the power battery industry is predicted, and suggestions for the development of the industry are put forward.

1. Overcapacity in power battery industry? For the discussion of power overcapacity, the most common point of view in the industry is phased excess, structural surplus, rather than overall excess.

With regard to the view that power battery capacity is in phased excess, Dai Ying, executive director and senior vice president of China Chuangxin Airlines, gave an explanation: the influx of a large amount of capital into the power battery industry may lead to the centralized release of some phased capacity, resulting in nominal overcapacity, which is a necessary process behind the law of the development of the market economy. From the side, it shows that the power battery industry is still in the early stage of development, and has not yet reached a relatively mature, stable, healthy and sustainable state. "only when the tide recedes will we know who is swimming naked," Dai said. "in fact, real high-quality production capacity is still scarce."

The structural overcapacity of power batteries is the view of Jia Hongtao, chief of power battery systems in Geely Automobile Group Research Institute. He said that the reason why there has always been structural overcapacity in power batteries is that backward capacity has been eliminated, but not necessarily excess capacity that can really meet customer or market demand. Zhu Ke, executive director of the China Information Association and founding director of the National Research Institute of New Economics, believes that some power battery enterprises with relatively less competitive advantages may be eliminated by the market, but this is a normal phenomenon.

In addition, some media have come to the judgment standard of power battery overcapacity, which is not scientific. Zeng Duohong, chief executive of Soochow Securities Dianxin, believes that the judgment of overcapacity needs to look at effective capacity, not the total capacity in the production expansion plan issued by power battery companies. It is reported that the production expansion plans of power battery enterprises are often divided into multiple stages, and in their production expansion projects, the first phase of the project will be landed strictly according to the plan, while the follow-up projects will often consider the landing according to the development of the enterprise itself and the market demand.

Zeng Duohong estimates that in 2023, the global effective supply of lithium batteries is 1500GWh, the demand is 1000GWh, and the capacity utilization rate is close to 70%, slightly lower than the normal level. In 2024, the effective supply of 1900GWh for the whole year is close to 1300GWh, and the capacity utilization rate decreases slightly.

Moreover, the matching relationship between power battery output and vehicle loading, only looking at short-term indicators, may also be meaningless. Wu Hui, general manager of the research department of Yiwei Economic Research Institute and director of China Battery Research Institute, said: "the matching relationship between power batteries and car companies usually takes two or three years to verify." it is also necessary to take into account some potential orders, strategic agreements between battery companies and car companies, intention orders, and so on. "

Therefore, Dong Yang, chairman of the China Automotive Power Battery Industry Innovation Alliance, believes that the current power battery production capacity is not out of control.

For the research on the capacity and demand of power batteries in China, we should not only pay attention to the Chinese market, but also need to pay attention to the global market. At the Global New Energy and Smart vehicle supply chain Innovation Conference in 2023, Zhang Yongwei, vice chairman and secretary-general of the China Electric vehicle Association of 100, said that at this stage, about 70% of the global battery capacity is in China, and the big market driving its future is still an important development area.

For the future of the power battery industry, 100 people will report that the global demand for power batteries is booming for a long time. The report predicts that by 2030, the total global demand for power batteries will reach 3800GWh, with China, Europe and the United States accounting for 28.9%, 26.3% and 23.7%, respectively.

Global power battery demand forecast data source: IEA2, technological innovation is the key to competition undeniable fact is that facing the future of power battery industry, the international competition situation of Chinese power battery enterprises is intensifying.

According to the hundred people's meeting report, although China's power battery is in a leading position in the world, Europe and the United States have issued a lot of protection and support policies for the battery field which will have a great impact on the global automobile industry in the future. The European Union has introduced a "new battery law" and the United States has introduced an "inflation reduction bill" in order to establish an independent and controllable local battery industry and its supply chain.

Source: public data collation and, by formulating strategic objectives, such as Japan's "Battery Industry Strategy" and South Korea's "2030 Secondary Battery Industry Development Strategy", governments focus on the layout of new-generation batteries, with a view to using subversive technology to change the existing industry pattern and win the leading edge of future development.

From some policies on the battery industry issued by Europe, America, Japan and South Korea and some plans for the commercial application of the new generation technology, we can see that the pattern of China's power battery in the whole international competition in the future is very fierce.

Therefore, the Bairen report believes that although at the current stage, many power battery enterprises focus on capacity expansion and other aspects, but facing the future, improving the technological competitiveness of power batteries is the key factor that determines the competitive advantage of enterprises.

This is because the power battery industry has the characteristics of technology-intensive, capital-intensive, economies of scale and so on. Throughout the development of the global power battery industry chain, technological innovation has always been the key driving force to promote the evolution of the market pattern.

In addition, the cost reduction of power battery is the consistent demand of both the supply side and the demand side, which is realized by means of stabilizing the price of upstream resources and large-scale production, while technological innovation is an important method of cost reduction. such as system structure innovation, new generation of low-cost material application, introduction of new technology of limit manufacturing, etc.

The source of the average price trend of global lithium battery system from 2013 to 2022: the report of BloombergNEF3, iterative upgrade and New system Development clearly points out that power battery technology is still in an active period of innovation and there is room for development in the future. The technological innovation of power battery is mainly reflected in the iterative upgrading of the existing system and the development of the new system.

First, how to iteratively upgrade the existing technology. Increasing its energy density, improving its cycle life and improving its fast charging are all further improvements and iterations on the existing system, and the optimization and innovation of "material + structure" in the existing battery system is the key breakthrough direction of power battery technology.

On the one hand, material innovation is the key basis of lithium-ion battery technology iteration, especially the impact on performance. For cathode materials, high nickelization is an important development trend of ternary materials; lithium manganese ferromanganese phosphate is a new generation of iron-lithium cathode materials with high energy density and high safety; lithium-rich manganese-based specific capacity is high. Technological research and development and industrial application are being promoted continuously. For composite current collector, the application of composite aluminum foil and composite copper foil can effectively improve battery safety and energy density, and the market space is expected in the future.

On the other hand, structural innovation is an important supplement to the iteration of lithium-ion battery technology, which is reflected in the structural optimization of cells, modules and systems, in order to improve the energy density of the battery system and reduce the manufacturing cost. At present, the structural innovation of battery system is still in the stage of sustainable development, and has evolved to the direction of non-modularization and high integration. Large cylindrical cell has both performance and economic advantages, can better integrate a number of new technologies and processes, and is moving towards the stage of mass production.

Second, the development of new system battery is an important strategic layout for the development of power battery technology, and sodium ion battery and solid-state battery are the hot spots.

Sodium ion battery has the advantages of rich resources, low cost and high safety, which can be compatible and complementary with lithium battery. At present, the multi-technology route of sodium ion battery is developing in parallel, and the industrialization tuyere is coming, but it still needs continuous improvement in technology, cost, industrial chain and so on. In the future, it is expected to be the first to cut into two-wheeled vehicles, energy storage and other application fields, and gradually move towards power.

Source: industry chain research, public data collation solid-state battery has both high energy density and high safety, is regarded as a new generation of battery technology to break through the bottleneck of traditional lithium-ion battery. Among them, the industrialization process of hybrid solid-liquid battery is relatively fast, and it is expected to enter a new stage of mass production in 2023. Due to many technical and technological problems to be solved, it will take at least 5-10 years to realize industrial application of all-solid-state battery.

What is gratifying is that in recent years, the leading companies in the power battery industry have continued to increase their R & D investment, such as the R & D investment of China's power battery and four major materials leading enterprises in 2022, most of which have more than doubled compared with the same period last year.

In recent years, Ningde era and LGES R & D investment (left axis) and R & D expenditure rate (right axis) sources: annual reports of various companies, from the level of industry development, the 100 people report recommends that in order to stabilize and enhance the competitiveness of China's new generation battery industry, actions should be taken from the top-level design, financial support, technology reserve, standard construction, intellectual property protection, upstream resource protection and personnel training. To promote the sustained and high-quality development of the power battery industry.

For more data and opinions on the development of the power battery industry, please refer to the report "Innovation drives the Development of a New Generation Battery" released by the China Electric vehicle Association of 100, as well as other related reports.

[full text reference]

[1] "exclusive interview with Soochow Securities Dianxin Chief Zeng Duohong: phased overcapacity in the lithium battery industry will meet the inflection point as soon as next year, and the strong leading enterprises will be Hengqiang", Securities Times.

[2] "the battery industry cools down and Cheng Ningwang saves his life in overseas markets", see Zhi Research

[3] "investigation | Jiewei Power stopped production, small and medium-sized lithium battery factories" spent the winter, head enterprises warmed up, what about overcapacity ", Red Star News

This article comes from the official account of Wechat: che Bai think Tank (ID:EV100_Plus). Author: Chen Zhongshan.

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