In the era of trillion-dollar solid-state batteries, an epic showdown before the dawn

In the era of trillion-dollar solid-state batteries, an epic showdown before the dawn 

 Any disturbance in the solid-state market, which is known as the "Holy Grail of the electric vehicle industry", will almost inevitably lead to a market frenzy or a capital storm. After entering 2024, the global solid-state battery industry has significantly accelerated the industrialization and mass production process, and the competition among enterprises is likely to be a decisive battle.

In early August, according to foreign media reports, lithium battery giant Samsung SDI demonstrated its latest battery technology at the SNE Battery Day exhibition held in Seoul, South Korea. Samsung SDI said its first batch of solid-state batteries have been delivered to electric vehicle manufacturers and have been tested for about six months. 

The vice president of Samsung SDI said that car manufacturers have a strong interest in solid-state batteries because they are smaller, lighter and safer than current electric vehicle batteries. He also added that the production cost of solid-state batteries is relatively high, so they will mainly be used in high-end luxury electric vehicles with a range of more than 600 miles (about 966 kilometers) in the initial stage. 

It is understood that Samsung SDI has developed Super-Gap solid-state battery technology, which increases energy density by 40% to 900Wh/L. The Super-Gap solid-state battery uses sulfide solid electrolyte and no anode configuration, and the battery life is expected to reach 20 years. In addition, Samsung SDI has 9-minute super fast charging technology. 

A month ago, on July 11th, PowerCo, a battery company under the Volkswagen Group, and QuantumScape announced an agreement to industrialize QuantumScape's next-generation solid-state lithium metal battery technology. 

According to the author's understanding, QS solid-state battery technology uses a unique ceramic electrolyte and lithium metal anode, which can achieve high density, fast charging, and high safety. According to the authorization, PowerCo can use QS to authorize the production of 40GWh of batteries per year, and can choose to produce 80GWh, which can provide batteries for about 1 million cars per year. 

In addition, according to the report of Interface News on January 2, 2024, Japan's large battery company Maxell has developed a cylindrical all-solid-state battery with a capacity of 200 mAh, which is 25 times the capacity of the traditional ceramic package (square) type. The sample will be shipped as early as January 2024. 

Earlier, on July 4, 2023, Toyota, the world's second largest automaker, publicly stated that it had made a major breakthrough in battery technology and could produce solid-state batteries with a range of 1200 kilometers after 10 minutes of charging, which was extended to 2.4 times the range of existing EVs equipped with batteries. Moreover, by simplifying the production process of materials used in the manufacture of solid-state batteries, Toyota's solid-state batteries are expected to halve the volume, weight, and price compared to existing batteries. 

Toyota also announced that it will commercialize all-solid-state battery technology in 2027-2028 and launch pure electric vehicles equipped with all-solid-state batteries to the market. 

David Bailey, a professor of business economics at the University of Birmingham, believes that if Toyota's statement is true, it may be a milestone moment for electric vehicles in the future. “Usually there are some breakthroughs in the prototype stage, but it is difficult to expand the production scale.” He added, “If this is a real breakthrough, it may be a disruptive change, and it can even be said to be the holy grail of the electric vehicle industry.” 

In order to compete for the right to speak of the "Holy Grail", domestic giants are also accelerating the industrialization process of solid-state batteries. At the first extraordinary general meeting of 2024 held by SAIC Motor on July 29, Jia Jianxu, the new president of SAIC Motor, revealed that the all-solid-state battery of SAIC Motor has started a 500-day production plan and entered the countdown to production; Secondly, Wu Kai, the chief scientist of Ningde Times, publicly stated that the company's all-solid-state battery is expected to be produced in small quantities in 2027; In addition, GAC Group also announced that the all-solid-state battery has passed the experimental stage and will be mass-produced and installed in 2026. 

In fact, the application of solid-state battery technology has also accelerated in the first half of this year. For example, on March 25th, I-MOTOR announced that the L6 model will be equipped with semi-solid battery products from Qingtao Energy, which have the performance of "over 1000km endurance + quasi-900V super fast charging + whole package without heat spread and no fire, super safe" and the price is only 30,000-60,000 yuan higher than the high-end version of ternary battery. I-MOTOR L6 has become the first model to use solid-state battery technology in mass production; Overseas, Power Co., a subsidiary of Volkswagen Battery, has recently achieved excellent performance attenuation performance of maintaining more than 95% capacity after more than 1000 charging cycles using Quantum Scape solid-state batteries. 

In terms of downstream demand applications, in addition to new energy vehicles, solid-state batteries are used in various application scenarios. On March 26th, vivo's new X Fold3 series was equipped with a semi-solid "Blue Ocean Battery" jointly developed with Ningde Times. It uses second-generation silicon anode materials with an energy density of up to 780Wh/L, and can maintain stable discharge performance at -20℃, effectively solving the problem of battery life in low-temperature environments; The semi-solid products of Weilan New Energy are applied to energy storage, and the orders of Dongchi New Energy come from electric ships and energy storage projects. In addition, eVTOL (electric Vertical Take-off and Landing) is also one of the potential application scenarios for solid-state batteries. 

Dongxing Securities believes that solid-state battery technology may enter a channel of cost reduction and speed-up, and is expected to achieve accelerated penetration in existing applications such as new energy vehicles and consumer electronics, with its multiple advantages of energy density, fast charging performance, long cycle life, and high safety. In addition, from the perspective of the long-term trend of electrification, solid-state batteries are also expected to be widely used in applications with high energy density requirements and difficult to penetrate in the current stage of electrification, such as ships, aircraft, and low-altitude drones and eVTOL in the low-altitude economy, with performance advantages far exceeding current lithium battery technology, expanding the application boundaries of lithium batteries and opening up the growth ceiling of the lithium battery industry. 

According to the data of China Automotive Power Battery Industry Innovation Alliance, the cumulative installed capacity of semi-solid batteries of Ganfeng Lithium Battery, Weilan New Energy and other enterprises reached 2.15GWh from January to June 2024, far exceeding the annual cumulative installed capacity of 0.80GWh in 2023. GGII predicts that the annual installed capacity of domestic (semi-) solid batteries is expected to exceed 5GWh in 2024. 

With the deep breakthrough of market demand and technology. Global enterprises are accelerating the layout of solid-state battery production capacity, and many overseas enterprises have set ambitious production capacity planning goals. For example, Quantum Scape expects to expand its production capacity to 1GWh by 2025, with a long-term plan of over 21GWh; Statevolt, headquartered in the United States, announced that its 40GWh solid-state battery super factory in the United Arab Emirates is scheduled to start production in 2026. Initially, it will focus on producing semi-solid batteries, and will switch to producing fully solid-state batteries after reaching full capacity; Nissan, Panasonic and SK on of South Korea plan to commercialize solid-state batteries by 2029. Nissan is currently building a pilot plant in Yokohama, with plans to produce the first batch of solid-state batteries in 2025. 

Return to the domestic market. According to incomplete statistics from the 24th Tide Industry Research Institute (TTIR), in 2023, domestic enterprises alone announced at least 14 major projects in the field of solid-state battery construction/planning, with a total investment budget exceeding 130 billion yuan. By the end of 2023, the domestic (semi) solid-state battery production capacity planning has exceeded 298GWh, with a production capacity of nearly 15GWh. 

According to GGII statistics, from January to July 2024 (as of July 22), the newly added capacity of solid-state batteries nationwide has exceeded 142GWh, involving an amount of 64.4 billion yuan. There are 30 investment projects involved, one of which is worth 10 billion yuan. 

Throughout the history of the lithium battery industry, it can be said that the new technology driven by innovation is the key to the success and rise of enterprises. New technologies promote the industry to continuously reduce costs and increase efficiency, and the downward trend in costs brings up demand, which in turn increases sales and feeds back to technology research and development. 

Only by relying on continuous technological innovation can the performance, cost, and safety of power batteries be unified. Wang Yu, Chairman of Fuheng Technology, said, "In the end, the increase in battery energy density must be achieved through the use of solid electrolytes in terms of safety. Only solid electrolytes can enable the application of higher energy density materials." 

"Solid-state batteries may be the ultimate form of lithium batteries in the future" is becoming a consensus among more and more people in the industry, but in reality, there are still many technical pain points and challenges in solid-state batteries. The challenges in the manufacturing process of all-solid-state batteries mainly focus on the solid-state electrodes and electrolyte film formation. For example, in the efficient densification and molding process of the battery cells, there may be problems such as pore defects, low density, and short-circuiting due to pressure on the edges of the pole pieces. In addition, both dry and wet film formation processes are not yet mature, with wet processes having problems of electrical performance degradation, while dry processes bring challenges of film dispersion and uniformity. Ningde Times said. 

It is particularly important to note that although China's lithium battery industry is currently in a leading position in the world, there is still a gap between China and Japanese and Korean companies in the field of all-solid-state technology. Taking the number of patents for all-solid-state batteries as an example, Toyota ranks first in the world with more than 1,300 patents, while the top ten are all Japanese and Korean companies. 

At present, the lithium battery industry has entered a new round of technological iteration, and it is at a historical critical point to determine the new industrial structure in the next decade. Without a doubt, whoever can solve the technical pain points of "solid-state battery" technology and realize industrialization faster in the future will have the power and historical opportunity to change or reshape the new pattern of the industry. 

The industry consensus is that improving the energy density and safety of batteries is the biggest challenge facing the power battery industry at present, but it also implies significant historical development opportunities. 

Looking back at the history of the development of new energy vehicles, thanks to the technology and innovation of power batteries, the mainstream endurance of various pure electric vehicles on the market has reached 500-600km, and the anxiety of owners about endurance mileage has been greatly alleviated. 

According to the White Paper on the Action Plan for High-quality Development of the Power Battery Industry (2023-2025), in 2022, China's power battery technology innovation capability continued to improve, with the maximum energy density of ternary battery systems increasing to 212Wh/kg and the maximum energy density of lithium iron phosphate battery systems increasing to 176.1Wh/kg; The average battery capacity of pure electric passenger vehicles has increased to 50.9kWh, and the proportion of models with a range of more than 400 kilometers has increased to 70.7%. 

However, from the perspective of technological development trends, the current mainstream lithium iron phosphate and ternary materials have already reached the ceiling of energy density. 

For example, due to the flammability, high corrosivity, poor oxidation resistance, and inability to solve the lithium dendrite problem of organic solvents in the electrolyte of liquid lithium-ion batteries, there is a risk of thermal runaway, which also limits the use of high-energy materials such as high-voltage cathodes and lithium metal anodes. The theoretical energy density limit is expected to be 300Wh/kg. The car show showcased products like the flash-charging battery launched by Sunwoda, the 4695 large cylindrical battery launched by EVE Energy, and the "top-flow battery" from China's innovative aviation, all of which have energy densities exceeding 300Wh/kg, nearing the upper limit of energy density. 

The author believes that if we want to further improve the energy density and safety performance of batteries in the future, solid-state batteries may be the best solution for the industry, with four core advantages: 

The first core advantage is that although solid-state batteries cannot improve energy density, they have more stable, safer, and wider electrochemical windows (above 5V) properties, which can help improve the energy density of batteries at the material, structural, and Pack levels. At present, the energy density of semi-solid batteries can reach 350Wh/kg+, quasi-solid batteries can achieve 400Wh/kg+, and fully solid batteries can exceed 500Wh/kg. 

The second advantage is that solid electrolytes can solve safety issues such as leakage and volatilization compared to liquid electrolytes. Due to the very high ignition point of solid electrolyte, replacing liquid electrolyte with solid electrolyte material will effectively improve safety. 

The third advantage is that solid-state batteries do not require electrolytes and separators, and can achieve the stacking of multiple layers of positive, solid-state electrolyte, and negative electrode materials. By connecting in series and then packaging and welding, the packaging is effectively simplified, resulting in a reduction in the weight and volume of the overall battery pack, thereby improving endurance. 

The fourth advantage is that solid-state batteries have a longer cycle life. The solid electrolyte is a single-ion conductor, with fewer side reactions and longer cycle life. Due to the lack of fluidity in solid electrolytes, there is no problem of repeated growth and dissolution of the SEI film, which helps to achieve stable cycling. In addition, the transition metal in the all-solid-state battery is not prone to dissolution, which can avoid the problems of positive electrode capacity attenuation caused by transition metal dissolution and the deposition of transition metal on the negative electrode side, which can catalyze the decomposition of the SEI film. 

According to Guosen Securities, the global demand for solid-state batteries (including semi-solid batteries) is expected to reach 2.3GWh in 2024, and the global demand for solid-state batteries is expected to reach 220GWh in 2030, with a compound annual growth rate of 114% from 2024 to 2030. The global market for solid-state batteries (including semi-solid batteries) is projected to be worth 1.95 billion yuan in 2024, with the market expected to reach 116.23 billion yuan by 2030, representing a compound annual growth rate of 98% from 2024 to 2030. 

A more optimistic forecast is made by the China Business Industry Research Institute, which predicts that the domestic shipment of solid-state batteries will reach 251.1GWh in 2030, corresponding to an increase of nearly 86 times from 2022 to 2030, with a CGR of 75% during period A; The Zhongyan Puhua Industrial Research Institute report predicts that the global shipment of solid-state batteries will exceed 500GWh in 2030. 

Returning to the level of corporate competition, in fact, in order to seize the next generation of battery technology, many car giants are laying out solid-state battery technology in advance by binding with battery factories. Car companies entering the market provide multiple guarantees such as capital, technology, and customers for solid-state battery companies, which helps to promote the commercialization process of solid-state batteries. 

In addition, nearly 30 international battery giants such as CATL, BYD, Samsung SDI, Panasonic, LG New Energy, Huineng Technology, Weilan New Energy, Ganfeng Lithium, and Guoxuan High-Tech have all made deep layouts in the field of solid-state batteries, and their momentum is very strong. 

In terms of capacity layout, according to the statistics of the 24Tide team, the total capacity planning of solid-state batteries for only seven companies, including Enli Power, Weilan New Energy, Huineng Technology, Ganfeng Lithium, Qingtao Energy, Jiangxi Judian, Gaole Shares, and Hongdou Shares, has exceeded 500GWh. 

For example, although solid-state batteries have unparalleled advantages in safety and energy density, they are an important direction for the future development of the lithium battery industry. But at this stage, technology and cost are still huge obstacles in the commercialization of solid-state batteries, which seriously restricts the commercialization speed of the industry and the promotion and popularization of solid-state batteries. 

As we all know, since 2020, China has included solid-state batteries in the industry's key development targets for the first time and proposed to accelerate the research and development and industrialization process. In 2023, it further proposed to strengthen the research on the standard system of solid-state batteries, but it is still mainly driven by the market. 

However, solid-state batteries are currently difficult to achieve thinness and lightness, and the use of some rare metal raw materials is expensive. Moreover, all-solid-state batteries also impose more stringent requirements on production processes, costs, and quality control. Due to factors such as high replacement rates of production equipment, their costs are significantly higher than existing liquid batteries.  

For example, according to the estimation of CITIC Securities, the cost of semi-solid battery is 0.87 yuan/Wh with a yield of 90%, while the cost of fully solid battery is 1.23 yuan/Wh with the same yield, which is still relatively high compared to the current mainstream ternary battery cost (0.4-0.5 yuan/Wh). 

 The market generally believes that scale is one of the best strategies for reducing the cost of solid-state batteries. In their article "Prospects on production technologies and manufacturing cost of oxide-based all-solid-state lithium batteries", Joscha Schnell, Frank Tietz, Célestine Singer, and others used oxide-based solid-state batteries as an example to calculate the production costs for batteries with capacities of 1MWh and 10GWh. The cost of mass-produced batteries is 65 times lower than that of non-mass-produced batteries, resulting in a more favorable price.  

Guoxin Securities believes that in the medium term, with the continuous expansion of the scale of the high-performance liquid battery and semi-solid battery industries, the prices of materials such as solid electrolytes and silicon-based anodes are expected to accelerate downward. At the same time, after the scale expansion, the production line operation experience will be more abundant, and the production line yield is expected to reach over 90%. At that time, we estimate that the total unit cost of semi-solid batteries will be about 0.50 yuan/Wh; In the long run, all-solid-state batteries are expected to be equipped with lithium metal anodes, and the electrolyte will be completely replaced with solid electrolytes. We estimate that the total cost per unit of all-solid-state batteries will be about 0.78 yuan/Wh. 

In addition, from the perspective of technical route, in the field of domestic solid electrolyte research and development, start-ups are represented by Weilan New Energy (oxide), Qingtao Energy (oxide), and Eneng New Energy (sulfide); Traditional lithium battery giants include Ningde Times (sulfide), BYD (sulfide), and Ganfeng Lithium (oxide). However, it is worth noting that the mature all-solid-state electrolyte solution has not yet been implemented at this stage, and there is still great uncertainty about the layout effectiveness of the above enterprises and the mainstream route in the future all-solid-state era. 

Moreover, the research on electrolyte materials in all-solid-state systems is still in the exploratory stage, and the technology is not yet mature, making it difficult to achieve large-scale commercialization in the short term. 

Due to the high interfacial impedance between the solid electrolyte and the electrode, the relatively low bulk ionic conductivity of the solid electrolyte, and the significant differences in production processes and procedures compared to liquid batteries, solid-state batteries require the purchase of a large number of new process equipment, which is one of the obstacles to accelerating the industrialization process. 

According to the analysis, for example, the all-solid-state route of sulfide that Ningde Times focuses on, although there are already experimental samples of high-energy density solid-state batteries, it may still take more than 5 years to achieve commercialization. 

CLPC also believes that solid-state batteries are currently in their infancy and industrialization still requires time. It is expected that "China's solid-state battery shipments will reach 251.1GWh in 2030, and the market space is expected to reach 20 billion yuan in 2030." 

Therefore, the domestic short-term focus is on the more compatible and economical semi-solid route: the first breakthrough in semi-solid battery loading will be achieved in 2020, but the energy density is at the level of 260Wh/kg, and the performance improvement is limited. In 2023, the loading of 360Wh/kg+ will be achieved. Many new energy vehicle companies at home and abroad have announced plans for semi-solid battery loading. 

Among them, Dongfeng, NIO and Celestica have announced that they will achieve the installation of semi-solid batteries in 2023, while Changan Shenlan, Zhiyi, Aion, Gaohuo and other car companies generally plan to install semi-solid batteries before 2025. 

A few days ago, on December 17, 2023, the live broadcast of the 150kWh ultra-long-endurance battery pack by CEO Li Bin of NIO also made headlines on social media.

The actual measurement results show that the energy consumption of the NIO ET7 is about 13kWh per 100km, with a remaining battery capacity of 3%. It is expected that the remaining CLTC mileage will be 30km+. The 150kWh battery pack tested this time is currently the largest capacity battery pack in the domestic passenger car field. The product was first released at NIO Day in 2021, using a semi-solid battery solution with a cell energy density of up to 360kWh/kg and a battery pack density of 260Wh/kg (Ningde Qilin battery density of 255Wh/kg); It can still achieve a range of thousands of kilometers during cold waves, which is sufficient to prove that the energy density and low-temperature performance of semi-solid batteries are ahead of mainstream liquid lithium-ion batteries. In addition, the safety of semi-solid batteries will also be improved. The product is expected to be mass-produced in April next year, and will be compatible with all NIO models, which will significantly enhance the competitiveness of car companies. 

This may further enhance the market's confidence in the application prospects of semi-solid batteries. However, it should be noted that the current semi-solid battery technology is still immature, with poor cycle times and rate performance, and has not yet achieved mass production at a high cost price. Therefore, there is a risk that downstream application progress may fall short of expectations. 

In order to seize the next generation of technology, China, the United States, Europe and other countries have issued relevant policies and set up long-term strategic goals for batteries, making a global competition inevitable. 

It should be noted that although China's lithium battery industry is currently in a leading position in the world, there is still a gap with Japanese and Korean companies in the field of all-solid-state technology. Taking the number of patents for all-solid-state batteries as an example, Toyota ranks first in the world with more than 1,300 patents, while the top ten are all Japanese and Korean companies. Because of this, in January 2023, the Ministry of Industry and Information Technology and other six departments clearly proposed in the Guiding Opinions on Promoting the Development of the Energy Electronics Industry that the research and development and application of solid-state batteries should be promoted. 

At present, the global core solid-state battery industry is mainly concentrated in Europe, America, Japan, South Korea and China. Among them, European and American countries mainly rely on entrepreneurial companies that independently develop solid-state battery technology; Japan and South Korea mainly focus on the cooperation between traditional automobile enterprises and battery enterprises; Chinese enterprises have invested heavily in research and development, supported by scientific research institutions or universities, and have achieved rapid industrialization. 

At the level of enterprise competition, power battery enterprises in China, the United States, Europe, Japan, South Korea and other countries have also made in-depth layouts in the field of solid-state batteries, and many enterprises have formulated ambitious production capacity planning goals. 

Among them, there are many start-ups in the United States, and companies such as QuantumScape and Solid Power have become the main force in the industry through cooperation with scientific research institutions. Its representative enterprise QuantumScape was founded in 2010 by Stanford University scientists Jagdeep Singh, Fritz Prinz, and Tim Holme, and has more than 200 solid-state battery patent technologies. 

QuantumScape has received investments from Bill Gates, Volkswagen Group, Continental Group and SAIC Motor, and has become a leading enterprise in the research and development of solid-state battery technology. 

Compared to traditional lithium batteries, its product performance has improved by 80% in terms of endurance mileage, with a maximum endurance of nearly 2000 kilometers; The charging time is significantly shortened. Compared to traditional lithium batteries that require 40 minutes to charge to 80%, its products only need 15 minutes to charge. 

It is understood that QuantumScape has begun to build a production plant, and plans to start trial production of some solid-state batteries in 2023, and achieve mass production in 2025. 

According to media reports in early April last year, Tesla recently hired Matt Tyler, a solid-state battery expert, as its "director of battery technology". Tyler graduated from the Milwaukee School of Engineering and has more than ten years of experience in battery design. His previous job was as the vice president of battery start-up company 24M, which focuses on the research and development of semi-solid lithium batteries. 

European companies mainly invest in start-ups, such as Volkswagen investing $100 million to form a new joint venture with QuantumScape, and BMW joining hands with Solid Power to jointly develop new solid-state batteries. 

Japanese and Korean companies often choose to cooperate in groups. Mitsubishi, Nissan, Panasonic and other Japanese companies have established joint research and development centers while maintaining independent research and development teams. 

The three leading battery companies in South Korea - LG Chem, Samsung SDI and SKI - also formed an alliance to cooperate in the research and development of solid-state batteries. On July 28, 2023, according to BusinessKorea, Samsung SDI is in negotiations with several automakers to mass produce all-solid-state batteries by 2027. 

The most representative enterprise Nissan has proposed the "Nissan Automobile 2030 Vision", which plans to build a solid-state battery pilot plant by 2024. By 2026, a total of about 112.8 billion yuan will be invested to accelerate the transformation of electric technology. Meanwhile, Nissan plans to achieve mass production of solid-state batteries in 2028 and launch the first electric vehicle equipped with the company's all-solid-state battery in the same year. In addition, Nissan announced on April 9, 2022 that it will cooperate with NASA to develop a new type of all-solid-state battery as a battery for product release in 2028 and pilot plant adoption in 2024. 

In terms of product performance, Nissan's solid-state battery has an energy density nearly twice that of traditional lithium batteries, with a charging time that is one-third of that of lithium batteries. Additionally, it reduces the use of expensive rare metals, effectively lowering battery costs. The all-solid-state battery is only half the size of the current battery and takes only 15 minutes to fully charge. According to the plan, the company's all-solid-state battery will reduce the battery cost to 75 US dollars/KWh in 2028 and further reduce it to 65 US dollars/KWh in the future. 

At present, the domestic solid-state & semi-solid battery manufacturers mainly include Qingtao Energy, Weilan New Energy, Ganfeng Lithium Battery, Fucheng Technology and Guoxuan High-Tech, all of which have achieved the industrialization of semi-solid batteries. 

For example, Weilan has planned four production bases in Beijing Fangshan, Jiangsu Liyang, Zhejiang Huzhou and Shandong Zibo, and has currently launched a 350Wh/kg semi-solid battery; Guoxuan High-Tech released its first semi-solid battery product in May 2022, with a single energy density of 360Wh/kg; Qingtao Energy built the first solid-state battery production line in China in 2018, and then invested 5 billion yuan in the Kunshan solid-state battery project in 2022; The first generation of semi-solid battery products with an energy density of 330Wh/kg from FonEnergy has achieved industrialization, boasting advantages such as high energy density, high safety, resistance to low temperatures, high-rate discharge, and long lifespan. Coupled with fast charging that can provide a range of over 400 kilometers in just 10 minutes, it will alleviate consumers' concerns about range and charging. 

Previously, according to media reports, China may invest about 6 billion yuan to encourage qualified enterprises to carry out research and development on all-solid-state battery related technologies. Six companies including Ningde Times, BYD, FAW, SAIC, Weilan New Energy and Geely may receive basic research and development support from the government. This unprecedented project in the industry is led by relevant government ministries and commissions, and encourages qualified enterprises to carry out research and development on all-solid-state battery related technologies. It is reported that after strict screening, the project is finally divided into seven specific projects, focusing on different technical routes such as polymers and sulfides. 

During the industry's most frenzied period, such as the period from 2013 to 2016, domestic power battery companies rapidly grew from the initial 40-plus to more than 200, with the number of players increasing more than fourfold in a few years. But after the frenzy, with the adjustment of national policies, the industry also suffered a major impact in the short term. According to statistics from Orient Securities, in the past five years, after a major reshuffle, the number of battery manufacturers capable of supporting vehicle models in China's power battery industry has decreased from 81 in 2017 to 36 (April 2023), a decrease of 55.56%. 

Industrial competition is so cruel! In the ups and downs of previous industrial technology cycles, a large number of companies have fallen, countless companies have been unable to recover, and some once-prosperous industry leaders have gradually left the scene; In the end, only a few companies successfully cope with the cyclical changes, taking the technology iteration cycle as an opportunity to make a strong layout and achieve counter-trend growth.  

At present, low-carbon economy and digital economy have become an irresistible global development trend. The lithium battery industry seems to have entered a new round of competition and reshuffle cycle. 

For example, according to the statistics of the 24th Tide Industry Research Institute (TTIR), in the past two and a half years (from the beginning of 2022 to June 2024), there were more than 700 major manufacturing projects with a total investment budget of over 3.5 trillion yuan announced on the China lithium battery industry chain alone, with a total investment budget exceeding 3.5 trillion yuan; According to market statistics, since the passage of the US Inflation Reduction Act, automakers and suppliers have announced investments of over $50 billion in electric vehicles and batteries in North America. According to the statistics of the 24th Tide Industry Research Institute (TTIR), Tesla, Northvolt, LG Chemicals, QuantumScape, Italvolt, SKI, Samsung SDI and other 13 companies will have a battery production capacity of 387.3GW and 971.3GW in Europe by 2025 and 2030 respectively. According to comprehensive statistics, the investment plan for the global lithium battery industry has exceeded 4 trillion yuan since 2022. 

 According to EVTank data, by the end of 2026, the total planned production capacity of 46 power (energy storage) battery companies included in the statistical scope will reach 6730.0GWh. From the perspective of actual demand, EVTank estimates in the White Paper on the Development of China's Lithium-ion Battery Industry (2023) that the global demand for power (energy storage) batteries will be 1096.5GWh and 2614.6GWh in 2023 and 2026 respectively, and the nominal capacity utilization rate of the entire industry will decrease from 46.0% in 2023 to 38.8% in 2026. 

Under the continuous impact of the crazy expansion and price war, the global lithium battery industry has inevitably shown signs of a major retreat (see the article "Global Lithium Battery Industry Retreat"). The future lithium battery industry reshuffle has become inevitable, and the timing and intensity of the competition may exceed everyone's imagination. 

The author believes that in the next 3-5 years, the development of the lithium battery industry will also focus on the pain points of new energy to create demand through technological iteration and achieve new penetration. The change in the competitive landscape of the lithium battery industry will also stem from whether companies have kept up with the development and transformation of the industry. 

Therefore, technology-driven will become a more important driving force for enterprises and even the entire industry. Some technology-leading enterprises will gain higher market share and profit levels, while enterprises with only mid-to-low-end product production capabilities will be deeply immersed in the competitive red sea, and the differentiation of the industry will further intensify.  

Throughout the history of the lithium battery industry, there have been lessons learned from the consequences of blind expansion. In the future, efficient and high-quality production capacity will still be in short supply. With the accelerating technological iteration in the market, lithium battery companies should make in-depth research and strategic planning based on market direction to remain invincible in the ever-changing industry cycle.