Winter in power battery industry

The decline in the production and sales of the new energy vehicle market is directly affecting the survival of power battery companies.

According to the latest data released by the China Association of Automobile Manufacturers, the sales volume of new energy vehicles in November 2019 was 95,000, a year-on-year decrease of 43.7%, continuing the downward trend in the market since the subsidy subsided. At the same time, Korean power battery companies LG Chemical and SK Innovation (\"SKI\") have announced expansion of production capacity in China to meet the decline in new energy vehicle subsidies in the Chinese market.

Power battery manufacturers are looking for breakthroughs, and many small and medium-sized enterprises are struggling on the brink of life and death.

sucker Punch

Recently, during the 7th battery\"Davos\" forum, Mr. Wang, a person in charge of a small and medium-sized power battery company, told First Financial reporter that his company has not received any information for nearly 2 months. Orders from auto companies, and some OEMs have required power battery companies to reduce the cost of their batteries from 3 to 5% per year to 10% or more in order to ensure profit after subsidizing the decline. As for many companies, they can't afford the current cost pressures, and they can't even take orders.

\"Because according to the reduction of this cost, large factories with certain financial support can barely survive, but many small factories cannot even guarantee normal production. According to the current market trend, the power battery companies that can survive, There may be only about 20 at most. \"Mr. Wang said.

The power battery industry also prospered for a time, but in recent years, whether in China or the global market, the trend of the concentration of the power battery market to head companies has become increasingly apparent. Data show that since 2016, the top battery companies in the global market for installed capacity are basically a few companies such as Ningde Times, Panasonic, LG Chemical, and BYD. 60% to nearly 80%. In September 2019, the global installed capacity of power batteries was 10.0GWh, a decrease of 10.5% compared with the same period of last year. Among them, the total installed capacity of power battery companies other than the top ten in installed capacity declined by nearly 50%, while the installed capacity of LG Chem increased year-on-year. The range is nearly 70%. And small and medium power battery companies are getting harder and harder.

The report launched by the power battery market research organization SMM also shows that since the beginning of 2019, as the market competition has further intensified, more than 100 power battery companies have stopped production or closed down; and the Secretary-General of Zhongguancun New Battery Technology Innovation Alliance Yu Qingjiao estimates After that, there are about 80 companies remaining in the domestic power battery market, of which only 40 can truly achieve installed capacity, which also means that nearly 60% of domestic power battery companies have been eliminated.

Demand increase

Regarding the current situation of small and medium-sized enterprises being eliminated, Yao Jie, deputy secretary general of the China Association of Automobile Manufacturers, believes that it is currently in the transition period from new energy vehicle policy-oriented to market-oriented. \"To be alone\".

Yao Jie told the First Financial Reporter that 40% to 50% of the cost of a pure electric new energy vehicle comes from power batteries and other\"three-electricity systems\", so it is subsidizing the decline and\"double points\" \"Under the combined effect of stricter policies, OEMs will definitely consider the cost of power batteries. Under this background, large enterprises and multinational enterprises with research and development capabilities and collaborative industrial manufacturing experience will have certain advantages.

SNEResearch CEO Jin Guangzhou (Transliteration) pointed out in an interview with CBN reporters that the energy density of NCM811 (high nickel battery) promoted by LG Chem and SKI is about 25% to 30% higher than previous products. The NDC range can exceed 500 kilometers, and the highest energy density of the square batteries used by Ningde Times and BYD is also maintained in the 150-180WH / kg range. The NDC range is generally around 300-450Km. At present, the domestic small and medium-sized power battery companies The highest energy density is generally around 140-160WH / kg. This standard can barely meet the threshold for obtaining subsidies, and even many companies cannot produce batteries that meet this index.

Peking University professor Qi Lu also believes that the power battery industry has developed rapidly in the past, which has led to low-quality development. The most important thing in how to shift to the market is to improve product competitiveness, and in the process, increase energy density In order to increase the cruising range and alleviate the pain points of charging difficulties, it has become an inevitable choice for new energy automobile OEMs.

\"Power battery research and development involves a relatively long industrial chain, which will involve a variety of disciplines and different technical levels. In the future, the battle over the energy density of energy batteries and the dispute over technology routes will continue to appear. It is difficult to resolve all The pain point will pose a high degree of challenge to the technical coordination and industrial chain integration. From this point of view, foreign power battery companies with integrated industrial experience occupy a certain advantage. \"Qi Lu told the First Financial Reporter that before Tess La has successively acquired three power battery industry chain companies, and head companies such as Ningde Times and LG Chemical have also acquired multiple material companies, which is sufficient to illustrate the importance of industrial chain integration.

At the same time, in the process of producing new energy vehicles, major OEMs have announced the establishment of electric vehicle platforms, including the E-GMP platform of Hyundai Motor and the MEB platform of Volkswagen, in order to improve performance and integrate effects at the R & D level. Etc., and launched research and development and production cooperation with large power battery companies. Automotive industry analyst Zhang Qiang believes that, for example, Tesla has been rumored to try square batteries instead of cylindrical batteries that Tesla has always used, which will inevitably lead to changes in the technical route and chassis design. Appearing among small and medium-sized battery manufacturers, it is likely that they will not be able to bear the costs associated with design changes and product lines.

Scramble for market segments

First Financial reporter learned that the current power battery industry is mainly divided into two types: lithium iron phosphate batteries and ternary lithium batteries, which are used in low-end passenger cars, some commercial vehicles and high-end passenger cars, Yu Qingjiao said, At present, many domestic power battery companies are returning to market segments such as 3C batteries or transforming to other industries such as the energy storage industry in order to\"survive\". In addition, some companies are turning to other niche companies such as lithium iron phosphate batteries. The market is transforming.

Yang Hongxin, general manager of Honeycomb Energy, believes that although foreign power battery companies are fierce, Honeycomb has a close relationship with Great Wall Motors. They have a better understanding of the needs of OEMs, and believe that from the needs of vehicle manufacturers, private cars, Internet-based cars, and operations The vehicles have different usage scenarios and battery requirements, so car-grade power battery production workshops can be tailored to the needs of the entire vehicle.

In addition, some small and medium-sized enterprises set out to solve the pain points of the new energy automobile industry. According to Eurovision's\"2019 Global Automotive Disruption Speedometer\" survey report, 94% of Chinese consumers are willing to consider electric vehicles when they next change cars, but 55% of potential consumers believe that charging issues are affecting their purchases Important factor. Wanxiang One Two Three is a power battery company headquartered in Hangzhou, Zhejiang Province. The company's vice president Chen Yan said that considering the pain points of many car owners about the car charging experience, the company focuses on launching new batteries in fast charging and cycle performance. It can realize that the mainstream fast charging pile is fully charged with 80% of electricity in 30 minutes to help the OEM to meet the pain points of consumers.

With the demand growth of other power markets such as mobile power and electric two-wheelers, many power battery companies have begun to transform into subdivided fields. In particular, the implementation of the new national standard has accelerated the lithium-ionization of electric bicycles, which has led to a surge in demand for related lithium batteries. Taking Penghui Energy as an example, according to its public announcement, the company expects third-quarter net profit to increase by 12% to 24% year-on-year, and It is mentioned that due to the company's focus on the electric two-wheeler market, the demand for lithium batteries for electric bicycles is expected to increase explosively in the third and fourth tier cities in the next few years.