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Overcapacity warning sounded! Power battery production expansion plan this year has exceeded the load of 10 times, "Ning Wang" and other first and second line manufacturers can "turn the corner"?

Overcapacity warning sounded! Power battery production expansion plan this year has exceeded the load of 10 times, "Ning Wang" and other first and second line manufacturers can "turn the corner"?

  • Categories:News
  • Time of issue:2022-12-05 10:55
  • Views:

(Summary description)According to the Economic Information Daily, the supply and demand of domestic lithium ion battery industry chain has attracted much attention recently. Some links of power battery have experienced blind expansion of production capacity, hoarding and unfair competition.

Overcapacity warning sounded! Power battery production expansion plan this year has exceeded the load of 10 times, "Ning Wang" and other first and second line manufacturers can "turn the corner"?

(Summary description)According to the Economic Information Daily, the supply and demand of domestic lithium ion battery industry chain has attracted much attention recently. Some links of power battery have experienced blind expansion of production capacity, hoarding and unfair competition.

  • Categories:News
  • Time of issue:2022-12-05 10:55
  • Views:
Information

According to the Economic Information Daily, the supply and demand of domestic lithium ion battery industry chain has attracted much attention recently. Some links of power battery have experienced blind expansion of production capacity, hoarding and unfair competition. Experts suggested that the development and utilization of domestic lithium resources should be accelerated, the production scale should be appropriately expanded, and the technical breakthrough should also be accelerated.

With the rising prosperity of the downstream new energy vehicle industry, the heat of the whole power battery industry chain has increased in recent years, and the current worries about overcapacity gradually emerge.

Recently, Wang Zidong, Deputy Secretary General of China Automotive Power Battery Industry Innovation Alliance, pointed out at the 2022 High tech Lithium Battery Annual Conference that "in 2023, the growth rate of new energy vehicles in China's local market is likely to decline. With the release of new capacity of power battery enterprises, the battery supply will surely be surplus."

In fact, as early as March this year, Ouyang Minggao, an academician of the CAS Member, issued an early warning of battery overcapacity. He said that China's battery capacity may reach 3000 GWh in 2025, when the battery shipment will reach 1200 GWh, there will be a large overcapacity.

Power battery capacity has far exceeded downstream demand

At present, power battery manufacturers are stepping up their preparations for the capacity competition, throwing tens of billions at the head, and the second tier is fast catching up, while downstream capacity digestion seems to be a problem.

Since this year, many battery manufacturers, including Ningde Times (300750), BYD (002594), Guoxuan Hi Tech (002074), Yiwei Lithium Energy (300014), Xinwangda (300207), Funeng Technology, have announced several expansion plans. According to incomplete statistics, at least 75 investment plans were announced in the field of power battery this year, with a total investment amount of more than trillion yuan. According to the report of China Automobile News, the planned new capacity this year has exceeded 1000GWh, about 10 times of the total power battery load this year.

It is worth noting that the second tier manufacturers seem to have a stronger momentum of production in order to seize the market share. According to the calculation of the research report of Zheshang Securities (601,878) on December 2, 2023-2025, the compound growth rate of domestic second-line power battery manufacturers' planned capacity is 46%, significantly higher than that of first-line manufacturers (28%) and the overall industry (35%). In this regard, the analyst of Everbright Securities (601788) pointed out in the research report on October 27 that while the current leading pattern is stabilizing, domestic second tier battery manufacturers such as Guoxuan Hi Tech, Yiwei Lithium Energy, AVIC Lithium, Honeycomb Energy are gradually entering.

According to Zheshang Securities, the planned capacity of major power lithium battery manufacturers in the world will reach 4335GWh by 2025, of which Ningde Times has disclosed that the planned capacity will exceed 900GWh; BYD's planned capacity reaches 290GWh; AVIC Lithium, Yiwei Lithium Energy, Honeycomb Energy and Guoxuan Hi Tech have the capacity planning targets of 360GWh, 311GWh, 376GWh and 187GWh respectively in 2025, and the second tier manufacturers plan nearly 1700GWh in total.

However, from the demand side, according to the data disclosed by Deloitte, by 2025, the battery demand of China Power (600482) will be only 360GWh. In addition, signs of shrinking downstream demand appear to have emerged. According to the recently disclosed data, in October, the cumulative sales of new energy vehicles in China exceeded 550000, down 9.2% month on month. At the same time, the power battery loading in October was 30.5 GWh, a 3.5% month on month decrease, including 3.5% month on month decrease in ternary battery and 3.6% month on month decrease in lithium iron phosphate battery.

Recently, Cui Dongshu, the secretary-general of the Passenger Transport Federation, reminded that at present, China's new energy (600617) car sales in the middle end are not ideal, and it is the largest increase in the later stage. If the penetration rate of new energy vehicles cannot be greatly improved in the later period, the power battery market will be further affected.

Structural surplus brings technical challenges

However, as for the huge gap between demand and supply at present, some analysts believe that it is largely due to structural overcapacity, that is, poor quality overcapacity, while high-quality capacity is still insufficient, which also brings a new round of tests on technology and cost control to power battery manufacturers.

According to the insiders, when the production capacity is stacked too much, one of the consequences is that the product quality is mixed up. The utilization rate of backward production capacity is low, and the quality cannot keep up with the upstream and downstream demand, which will result in waste of production capacity. On the other hand, the production capacity targets announced by power battery manufacturers are often relatively high, and some production capacities cannot be implemented normally.

China Merchants Bank Research Institute said that the continuous expansion of power battery manufacturers has led to continuous excess nominal capacity, and high-quality capacity is still scarce. For the supply side, not all enterprises can enjoy the dividend of industry growth. According to the capacity utilization data of mainstream power battery manufacturers, the capacity utilization of leading manufacturers (such as Panasonic and Ningde Times) and high-quality second tier manufacturers (such as AVIC Lithium) are still in the forefront. Therefore, focus on the comprehensive competitiveness of battery enterprises in terms of technical strength, product structure, etc. Even if there is overcapacity, high-quality battery enterprises can still maintain a certain market share and revenue scale.

According to the research report of Zheshang Securities on December 1, power battery enterprises are currently overweight new technologies, accelerating the breakthrough of 4680 batteries, sodium ion batteries and other technical routes. It is reported that Ningde Times, Guoxuan Hi Tech and Funeng Technology have all started to deploy more advanced battery materials - lithium manganese iron phosphate battery. In addition, the next generation battery technologies such as sodium battery and vanadium battery are expected to weaken the demand for backward battery capacity.

From domestic internal volume to overseas external volume

In addition to technical efforts, the sea going layout has increasingly become a competition venue for power battery manufacturers.

The data shows that the export of domestic power batteries has grown very rapidly this year. From January to October, the export volume of power batteries in China has exceeded 100GWh, reaching 105.3GWh. Market analysts pointed out that most of the difference between domestic production and loading was used for export.

At the recent meeting, Wang Zidong also suggested that battery enterprises should speed up their journey to the sea and form a joint relationship with foreign vehicle enterprises, which will help solve overcapacity.

It is reported that Ningde Times, Xinwangda, Yiwei Lithium Energy, Guoxuan Hi Tech and other enterprises have announced that they have won orders for power batteries from overseas car enterprises this year, and have stepped up their overseas factory building mode. According to public information, Guoxuan Gaoke's Gottingen factory in Germany held the unveiling ceremony in June, becoming the company's first European battery production and operation base; Ningde Times announced in August that it planned to invest no more than 7.34 billion euros to build a factory in Debrecen, Hungary; In September, Honeycomb Energy announced the construction of its second overseas factory in Germany.

Wang Qing, deputy director of the Market Economy Research Institute of the Development Research Center of the State Council, believes that the judgment of overcapacity is questionable due to factors such as rising overseas exports. However, he also said frankly that the current power battery industry does have the problem of excessive expansion.

As for the late development trend of the industry, Wang Zidong analyzed that the most direct impact of overcapacity of power battery on the industry will be market integration. Second and third tier battery manufacturers with insufficient experience in large-scale supply may suffer from imbalance between supply and demand. Some enterprises may be merged and reorganized due to low capacity utilization. At that time, the battery enterprises will no longer compete for capacity advantages.

Source: cailianshe

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