Overcapacity in the power battery market opens the "mode of elimination"

Fang Jianhua, president of the National Science and Technology Achievements Fund Fund for New Energy Automotive Venture Capital, believes that by the end of this year, China's power battery capacity will reach 180GWH-200GWH, but sales will not exceed 40GWh. The deepening structural surplus in the power battery market has not affected the expansion enthusiasm of major battery manufacturers.

For example, the Ningde Times plans to raise another 30 billion yuan by 2020 to increase the company's battery capacity by 5 times to 50GWh, and BYD's new 10GWH capacity in Qinghai is also progressing in an orderly manner. It is expected that the capacity will reach 34GWH by 2020. According to statistics, the capacity expansion of the top ten power battery manufacturers will reach 225 GWH in total by 2020, and if the sales volume of electric vehicles in that year is 2 million, the market demand will be less than 120 GWH.

On the one hand, the expansion of production capacity of major battery manufacturers lies in the good expectations for the development of the power battery market, and the rapid growth in demand for high-end power battery capacity and the current status of the industry in short supply; secondly, the power battery market has entered a key transition period and concentrated outbreak period. The intense competition in the industry and the acceleration of elimination have given smaller and smaller companies and new entrants opportunities.

First, the pace of development of SMEs and new entrants is difficult to synchronize with the market. At present, the energy density of the power battery is climbing at a rate of 50wh/kg per year. Most battery companies previously used lithium iron phosphate as the main product. In turn, the development and production of triple batteries require a relatively long period of accumulation, but the market does not Sufficient transition time;

Secondly, the price of the power battery drops at a rate of 20% to 30% per year. Under the pressure of cost reductions and raw material prices, the power battery expansion boom is basically limited to the top ten manufacturers, while other small and medium-sized companies Enterprises and new entrants are unable to expand production, and the gap in capacity between the two will continue to widen.

The cost advantages under the large-scale production of large-scale battery manufacturers have become increasingly prominent. The price advantages possessed by small and medium-sized enterprises and new entrants have disappeared. Large-scale battery manufacturers have even taken the initiative to drastically reduce their battery prices, accelerating the elimination of SMEs and new entrants.

Secondly, the application areas of SMEs and new entrants are out of line with the mainstream market. Passenger cars have become the mainstay of the new energy automotive market, but there are not many high-end battery manufacturers that can truly meet the needs of passenger vehicle companies.

Industry insiders pointed out that in the application of passenger vehicles, there are only a few companies that have a ternary line of dynamic battery products that are in line with the future trend and have large-scale production capacity, such as the Ningde Times, Lishen, and Bick. The introduction of the dual-point system will lead to a further outbreak of the passenger car market. The market concentration of high-end production capacity will continue to climb. Large-scale business operations will extend to mid- to low-end markets, and the market space for SMEs and new entrants will continue to be compressed.

In the end, SMEs and new entrants lack advantages in the heated competition environment. On the one hand, as the openness of the domestic power battery market continues to increase, multinational battery manufacturers have come to China to build plants to prepare for the full marketization of 2020; on the other hand, new energy car companies continue to reserve power battery technologies for their own battery factories. Preparations, including Geely, BAIC, Changan Automobile, and Daimler, have announced their technical reserves and production plans for power batteries.

Recently, Desai battery revealed during the survey that Huizhou Xinyuan (secondary subsidiary), which mainly manages power management systems and packaging integration businesses for large-scale power batteries and energy storage batteries, is not operating satisfactorily and has not yet formed a continuous sales scale. As expected, it lost nearly 70 million yuan in the first three quarters.

When Battery Power Network interviewed the heads of many battery companies, they talked about a common feeling that the future of companies in the market is still full of uncertainty. However, for companies with core technologies and competitiveness, the introduction of market capital has become a shortcut for most companies to break through.

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