China leads the way in electric vehicle batteries

China is the industry giant More than a century ago, Des Moines, the capital of Iowa, was the global electric vehicle center. In 1912, when the industry reached its peak, more than 30,000 'horseless carriages' were produced. In the following century, the 'automobile' (that is, old-fashioned car) invented by Scottish immigrant and chemist William Morrison was replaced by internal combustion engine vehicles. Now, exhaust emissions and their impact on climate change are forcing governments to look for alternatives to fuel vehicles, and the world has renewed its sights on electric vehicles. The Chinese passenger car market, which just started 20 years ago, is not only in the popularization and manufacturing of electric vehicles, but also in the world's leading position in terms of its most important component, batteries. Batteries account for 30% to 50% of the total value of electric vehicles. Ryan Castillo, general manager of Adamas Business Intelligence, a Dutch rare earth and battery metal consulting company, said: 'China is the current industry leader. In the next 15 years, it will continue to develop rapidly and dominate every step of the value chain, while Europe will dominate every step of the value chain. Close behind. Tesla will remain a giant in the field of electric vehicles, but as far as the country is concerned, China is also a giant.' Europe and the United States are stepping up to catch up To maintain the leading position in the industry, the production capacity already possessed and planned to be built may more than triple within ten years. Bloomberg New Energy Finance's energy storage department head James Frith said that the next decade will be 'extraordinarily interesting' because Europe and the United States are trying to build their own battery industry leaders to challenge the current Asian leaders. Bloomberg New Energy Finance said last month that China has the world’s most competitive lithium-ion supply chain, replacing Japan and South Korea’s ten-year leading position in this field. Boosting factors for competitiveness include China’s 72 GWh of domestic battery demand and the control of 80% of global raw material extraction capacity, 77% of battery production capacity and 60% of parts and components. Although ranked 11th in terms of innovation and infrastructure, this industry in China is investing heavily in improvements. Ningde Times, the world's second-largest electric vehicle battery manufacturer, is preparing to invest 3.3 billion yuan (about 495 million US dollars) to build a research center with 1,000 employees within five years. The company, based in Ningde City, Fujian Province, said its focus is on next-generation lithium-ion, solid-state and nano-ion battery technologies. According to the certification issued by the Ministry of Industry and Information Technology in April, Xiaopeng Motors’ P7 medium-sized electric car uses the company’s batteries and has a maximum mileage of 706 kilometers on a single charge. Another competitive advantage China has accumulated over the years is its control over a large number of global resources and its ability to extract lithium, cobalt, nickel, manganese and other key materials required for batteries. The sales of electric vehicles in the Chinese auto market also surpassed everywhere else. According to Credit Suisse, China's electric vehicle sales last year was 1.05 million, equivalent to 54% of the global total, 2.3 times higher than the second-ranked United States. Driven by the government's policy support, the continuous decline of battery costs and the rapid expansion of charging infrastructure, the sales of electric vehicles may reach 4.5 million by 2025. The cost of batteries will fall. According to South Korea’s SNE research company, the current oversupply of electric vehicle batteries is likely to fall into shortage before 2023, when demand will increase about four times this year to 916 GWh. The continued decline in battery costs will promote this increase in demand. According to data from Esson Huamai, the average cost of lithium-ion batteries has fallen by 82% in the past eight years, and is expected to be further reduced to US$100 per kilowatt-hour by 2023, and to US$73 by 2030. Castillo said that the average price in two years (US$100 per kilowatt-hour) will be an important milestone, which will allow unsubsidized electric vehicles to compete with petrol vehicles in cost. It is estimated that the global supply of electric vehicle batteries will be in the hands of manufacturers in China, Japan and South Korea. David Merriman, a battery and materials analyst at Roskill Information Services, said: “Much of the production capacity under construction in Europe is ultimately owned by Asian manufacturers.” According to data from SNE Research, South Korea’s LG Chemical Company and China’s CATL has its own factories in Europe. The former produced 24.6% of global electric vehicle batteries in the first eight months of this year, and the latter had a market share of 24%. As the global production capacity of electric vehicles and batteries increases, regional supply chains are gradually established to cut costs. Merriman said: “If lithium concentrate is to be shipped to China for processing, then to South Korea, then back to China, and then shipped to Europe, the cost will be too high to sustain. In addition, the supply of important industries is also subject to certain geographical constraints. Political influence.' He said: 'Europe is now very tense because the internal combustion engine is gradually inadequate, and it is the main force supporting the economy. We are working hard to develop electric vehicle technology and increase production capacity in the region to maintain strong employment and economic growth. .'