Review and Outlook of the Lithium Battery Industry Chain
Although the industry is developing rapidly, the stock price trend has been a painful year for companies upstream of lithium batteries. As the market is increasingly worried about oversupply, the share price of lithium companies eventually collapsed. But in fact, the release of supply was not as expected, while the growth of demand far exceeded expectations. 2018 is an important year for the popularization of lithium-ion battery applications. In the past year, the world has made significant progress in the use of clean energy and green transportation. Although the use of renewable energy is still in the early stages of development, this trend is irreversible and has taken root in many industries, or it will bring about disruptive changes. Although the industry is developing rapidly, the stock price trend has been a painful year for companies upstream of lithium batteries. As the market is increasingly worried about oversupply, the share price of lithium companies eventually collapsed. But in fact, the release of supply was not as expected, while the growth of demand far exceeded expectations. In the automotive field, the global non-passenger vehicle market is shifting to electric drive platforms, including buses, material handling vehicles, garbage trucks, and so on. Due to the exponential growth in downstream demand, midstream battery manufacturers are also making every effort to prepare for expansion. The main battery expansion plans for 2018 are as follows: Tesla intends to increase its production capacity by a total of 60GWh; LG Chem intends to increase its production capacity by 32GWh; CATL intends to increase its production capacity by a total of 38GWh, and its long-term capacity plan exceeds 100Gwh; BYD intends to increase its production capacity by 60GWh in 2020 , The long-term capacity planning also exceeds 100Gwh. In addition, Tesla also promised to have a production capacity of 500,000 vehicles in China. If calculated according to US specifications, this will consume 40Gwh of battery capacity, which is equivalent to 30,000 tons of lithium carbonate LCE. In addition to the common passenger vehicle field, areas that people may not be familiar with, such as material handling vehicles, garbage trucks, and ferry fleets, are also being replaced by lithium batteries. These areas will become major opportunities for the development of the lithium supply chain. Obviously, in order to meet the demand brought by the global transition to electric vehicles and renewable energy, the increasing production capacity of battery manufacturers will drive the demand for lithium chemical products. The global battery manufacturing capacity is expected to rise from 175GWh in 2017 to 630GWh in 2022, and to 2,000GWh by 2030. In addition to the automotive sector, the global fixed energy storage and charging infrastructure market is also growing rapidly, especially the public utility-scale 'large-scale' projects and the residential market. In the German residential market, the installation of battery systems has exceeded 100,000, and the South Australian state government continues to promote its residential energy storage plan, and it is expected to install 40,000 sets of lithium energy storage systems in the next few years. At the same time, the Caribbean market has also made breakthroughs. Puerto Rico and other islands quickly restored power supply after hurricanes Irma and Maria relying on lithium energy storage systems. According to reports, all new solar power plants in Puerto Rico are now equipped with lithium battery energy storage systems, and many owners of existing systems are retrofitting the systems to include energy storage capabilities. Entering 2019, the trend of popularization of lithium batteries will continue. It is expected that the sales of electric vehicles in the global passenger transport market will continue to hit record highs; the number of electric vehicles available to consumers will continue to increase; municipal bus fleets will continue to be electrified; basic large-scale energy storage projects for public utilities will continue to increase; Europe, the United States , The residential energy storage market in the Caribbean and Australia will continue to maintain high growth; electric vehicle charging infrastructure will continue to maintain rapid growth; there will still be new participants or countries entering the lithium supply chain. For lithium companies, because the supply is indeed increasing, 2019 may not easily usher in a major reversal of stock prices, but the long-term future is still very good and it is worth looking forward to.