Chen Qingtai: 1/3 of power battery companies have been eliminated

The number of Chinese power battery supporting enterprises has dropped from about 150 in 2015 to about 100 in 2017, and one-third of them have been eliminated. The market is further concentrated on dominant enterprises, and small and low-level enterprises will be eliminated in the competition. On June 27, Chen Qingtai, chairman of the China Electric Vehicle 100 Association, introduced the above information at the China (Qinghai) Lithium Industry and Power Battery International Summit Forum.

『Chen Qingtai, Chairman of China Electric Vehicle 100 Association』

Chen Qingtai introduced that the global competition in power batteries is becoming increasingly fierce. Chinese companies will gradually expand from the domestic market to the international market, while Japanese and Korean companies will further expand into the Chinese market. China will become the main battlefield for power battery competition. Although European and American companies have lost their position in this round of competition, they are already making plans for the next stage of competition and are potential strong competitors.

Chen Qingtai also pointed out that the development of China's power battery industry faces a series of prominent problems:

■ Global lithium, cobalt and nickel resources present oligopoly characteristics. Although China is rich in lithium resources, its endowment is poor and its utilization rate is relatively low. In addition, nickel and cobalt resources are scarce and the external dependence is high. In the long run, there is a risk of resource security.

■ In recent years, the prices of upstream materials such as lithium and cobalt have risen rapidly, while subsidies for new energy vehicles have been declining. The cost transfer by car companies has put battery companies under double pressure. This has put a lot of financial pressure on battery companies, and some companies have begun to experience operating difficulties.

■ The power battery market is experiencing tight supply and overcapacity. Relevant data show that China's power battery production capacity exceeded 200GWh in 2017, but the overall capacity utilization rate was only 40%, and the market polarization was very obvious. The high-end and high-quality production capacity was in short supply, the low-end production capacity orders were insufficient, and production and operation were difficult, showing a structural overcapacity.

■ Battery recycling technology and system construction are not in place. At present, recycling technology is not mature enough, the acquisition network is not perfect, the management measures are not sound enough, the support policies are not in place, and the business model and profit model are yet to be explored.

Based on the above problems, Chen Qingtai believes that the country should formulate medium- and long-term resource planning, regard lithium, nickel, cobalt and other resources as strategic resources, strengthen resource exploration, evaluation, mining and resource recycling, strengthen market supervision, guide prices to return to rationality, encourage enterprises to deploy upstream resources globally, and reduce resource risks.

At the same time, the state should strictly control resource mining and battery production projects. In the mining process, it is necessary to formulate mandatory standards, raise the entry threshold of mining enterprises, eliminate large mines and small mining, and improve resource recovery efficiency and environmental protection standards. Those enterprises that do not meet the standards should be closed, the overall level of resource utilization should be improved, and the technical standards and supervision of the battery industry should be strengthened to prevent bad money from driving out good money.

In terms of building a power battery recycling and reuse system, Chen Qingtai suggested that relevant technical, safety and environmental protection standards should be formulated, the development of power battery recycling and cascade utilization enterprises should be encouraged, and an incentive mechanism for power battery recycling and utilization should be studied and introduced.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.