Sanyuan Battery will unify Lithium Iron and Lithium Iron Phosphate Battery or gradually withdraw from next year

If current policy trends remain unchanged, it is expected that lithium iron phosphate batteries will gradually exit the electric vehicle market in 2018 and beyond.

On April 12th, Mo Keke, chief analyst of True Lithium Research, published the above viewpoint at the 3rd Nickel-Cobalt Lithium Industry Chain Summit and Cathode Materials Trading Seminar. He said that in 2019, it is expected that lithium iron phosphate battery will completely withdraw from the pure electric passenger car market, the proportion of pure electric passenger cars will also decline year by year, its focus on low-speed electric car market, but the market will also face three yuan battery Strong competition.

According to the type of car, pure electric vehicles can be divided into pure electric passenger cars, pure electric passenger cars and pure electric special cars.

In 2017, the proportion of lithium iron phosphate batteries in the pure electric bus market is still very large, close to 90%. However, Merck expects that this proportion will drop to 75%, 50% and 25% respectively in the next three years (2018-2020).

According to the data from the Institute of Advanced Industrial Science and Technology (GGII), in 2017, the domestic installed capacity of battery power was approximately 36.39 GWh, which was a year-on-year increase of more than 20%. The lithium battery technology roadmap has undergone tremendous changes in the past year. Sanyuan Power Battery accounted for more than 44% of the market share and doubled from 2016.

Ningde era, BYD (002594.SZ), Guoxuan Gaoke (002074.SZ) and other lithium iron phosphate battery companies have begun to expand the three yuan battery capacity. In August last year, Guoxuan Hi-Tech announced that its subsidiary will cooperate with China Metallurgical Group Co., Ltd., BYD, and Tangshan Caofeidian Development Investment Group Co., Ltd. to jointly construct ternary cathode materials. The registered value of the newly established joint venture company is 937 million yuan. . In addition, BYD is expected to expand its Sanyuan battery capacity of 10GWh in Qinghai this year.

Meike believes that the lithium battery industry began to adjust in depth in 2017, with the center of gravity shifting to pure electric passenger vehicles. After the subsidies are linked to battery energy density, the rapid growth of ternary lithium batteries exceeds industry expectations and the ternary battery line will quickly occupy Dominance.

"Pure electric passenger cars will be the focus of growth in the next few years, and it is expected that the year-on-year increase in 2018 will be close to 50%," said Mo Ke. According to his prediction, the total installed capacity of power batteries will exceed 100GWh in 2020.

The adjusted new energy subsidy policy will be officially implemented on June 12 this year. The new policy divides the subsidy into six gears according to mileage. The calculation method is: subsidy amount of bicycle = mileage subsidy standard × battery system energy density adjustment coefficient × vehicle energy consumption adjustment coefficient.

The new subsidy policy will promote the accelerated reshuffle of the power battery industry. In 2017, the battery capacity with an energy density of less than 105Wh/kg accounts for 50.7%, and this part will not be subsidized in the new program.

Mo Ke said that the new subsidy policy has a greater impact on pure electric passenger cars, and the competent authorities are intensifying their efforts to stimulate technological progress. “In pure electric passenger vehicles, the new program’s 100 km power consumption requirement has been reduced by an average of 12.6% and will be phased out. Nearly 30% of products."

According to the China Battery Network statistics, in 2017, there were 35 mergers and acquisitions in the lithium battery industry chain, and the transaction amount exceeded 46.5 billion yuan. The degree of industry concentration has also been enhanced. In 2016, the top ten power battery companies in the shipment volume totaled 69.8% of the market share. In 2017, this figure increased to 82.4%. Among them, only the Ningde era alone accounted for nearly 30% of the overall market share.

The decline in subsidies also led to a decline in the profits of battery companies. In 2017, BYD’s net profit fell 19.51% year-on-year. In the first quarter of this year, net profit is expected to decline by 75.24%-91.75%.

In addition, Mo Ke also said at the meeting that in terms of technology development, Chinese battery companies have caught up with foreign companies, but there are still gaps in the quality of production. Overall, in 2020, China's battery industry level will be comparable to South Korea.