China owns EV battery manufacturing – for now

An article written by George Leopold for OJO & YOSHIDA REPORT, in collaboration with Shalu Agarwal and Milan Rosina from Yole Développement (Yole) – Laser-like focus, perseverance and plenty of cash have enabled Chinese manufacturers to dominate the electric-vehicle battery sector.

What’s at stake?

Chinese manufacturers command the global electric-vehicle battery market. Indeed, about three-quarters of the world’s EV batteries are made in China. But competition is fierce, and the search for new battery chemistries based on plentiful materials may chip away at China’s lead.
The opening round of the strategic competition for electric vehicle battery dominance is over: China has won.
Unmatched access to battery materials, manufacturing know-how, scaling capability, assured domestic demand and plenty of government support for market leaders like Contemporary Amperex Technology Co. Ltd. (CATL) mean aspiring EV battery producers will be playing catch-up for the foreseeable future. That reality is accelerating shifts away from current battery chemistries based on lithium, manganese, nickel and cobalt to future combinations based on more plentiful materials.
The hope is that the shift not only will lower the barriers to entry but will eventually yield high energy densities and greater EV ranges.
For Chinese battery makers, “The common threads seem to be patience, perseverance, focus and a ton of capital,” said Tu Le, managing director at Sino Auto Insights.
CATL, battery supplier to Tesla and China’s Nio, grabbed about half of the booming Chinese EV battery market in March, according to data released by the China Automotive Battery Innovation Alliance. “Can anyone dethrone CATL?” asked analyst Le “Not likely in China unless the Chinese sees them as too big to control.”

Along with funding, well-heeled Chinese EV manufacturers like BYD Co. and CATL possess high-volume production expertise and the ability to scale battery manufacturing to millions of cells per month, noted Milan Rosina, principal analyst for power electronics and batteries at Yole Développement.

Among the factors in China’s favor are that “they can move very rapidly, they have governmental and financial support to do so, and they have the advantages of low cost” for labor and electricity, Rosina said. But “the biggest advantage in this field is that [Chinese EV companies] have an end market” for EV applications, providing assured demand.

The Chinese government has also leveraged rationalization of its overall manufacturing infrastructure to advance its EV ambitions. Meanwhile, Chinese EV companies have applied the lessons learned through decades-old joint ventures with Western partners. A key step was securing global supply chains for lithium and other battery materials. That move has enabled CATL and others to dominate production of the NCM (lithium nickel magnesium cobalt oxide) cells that power most high-end EVs.

… Read the full article

Source: https://ojoyoshidareport.com/

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