Chinese NEV companies accelerate global foothold, from lithium mine exploration to car production facilities

Photo: NEV

Chinese electric vehicle (EV) manufacturer NIO on Friday celebrated the shipment of its first battery swap station from Biatorbagy, Hungary, to Germany, produced by NIO Power Europe, the first overseas factory of the society.

NIO said the facility will support its commitment to install 1,000 battery swap stations outside of China by 2025. In the second half of this year, integrated power services and automotive products from NIO will be available in Germany, the Netherlands, Sweden and Denmark, according to a statement from NIO.

NIO’s overseas plant is the epitome of Chinese enterprises’ approach to the New Energy Vehicle (NEV) industrial chain expanding its overseas footprint.

Analysts said the industry chain of NEV, from upstream to downstream, can be roughly divided into four parts: batteries, including battery materials and battery manufacturing, production and sales of NEV, use of NEVs, including charging batteries and battery swapping stations, and recycling.

In all respects, Chinese enterprises have taken a leading position in the industrial chain of NEVs, especially electric vehicles, and are accelerating their overseas expansion, which will further strengthen the dominant position, a veteran veteran told the Global Times on Sunday. of industry based in Shenzhen, surnamed Zeng. .

Increase battery power

China has already dominated the entire downstream supply chain of NEV batteries, namely cell component manufacturing, battery cell manufacturing and NEV manufacturing according to the International Energy Agency. China produces 75% of all lithium batteries and is home to 70% of production capacity for cathodes and 85% for anodes, two key components used in batteries.

Among the world’s top 10 electric battery suppliers, Chinese companies account for half, with a market share of 37.3%. But Chinese companies are still accelerating their global rollout to increase capabilities in mining and materials processing, upstream components of battery production.

Since lithium is an indispensable material for making battery cells, Chinese companies, including battery makers and automakers, have sought to expand material exploration. It is also about securing the supply of raw materials, Zeng said.

For example, Ganfeng Lithium, China’s top battery metal producer, began construction of Mariana Lithium in Argentina in June. Zijin Mining Group acquired Canadian lithium miner Neo Lithium Corp in January. It is also reported that BYD was in talks to buy six lithium mines in Africa in June, with total reserves of 2.5% lithium oxide estimated at more than 25 million tons.

As Chinese battery makers pledged to increase raw material supply, their battery production continued to increase.

Major lithium battery makers in China invested more than 439 billion yuan ($63.1 billion) to build new production lines in the first half of 2022, which were expected to generate 1,069 gigawatt hours of production capacity, according to industry data. China’s lithium battery production exceeded 280 GWh in the first half of 2022, up 150% year-on-year.

According to customs data, in the first half of 2022, China exported 1.903 billion lithium batteries, up 36.76 percent year on year, with the export value reaching more than $20.22 billion, up of 76.35% over one year.

Chinese battery manufacturers are also building overseas workshops, which will greatly reduce transportation costs, because lithium battery is considered dangerous goods during shipment, which requires special packaging. Lithium batteries should be shipped at a state of charge no more than 30 percent of their rated capacity, according to Zeng.

At the same time, Chinese battery manufacturers have continued to innovate. For example, CATL launched Qilin, a third generation of its cell-to-pack technology, in June. With a record volume utilization efficiency of 72% and an energy density of up to 255 watt-hours per kilogram, Qilin achieves the highest level of integration in the world to date, capable of delivering a battery life of more than 1 000 kilometers in no time.

Graphic: Tang Tengfei/GT

Graphic: Tang Tengfei/GT

Manufacture and sale of NEVs

Within the downstream industry chain, China’s NEV production and sales have ranked first in the world for seven consecutive years. And Chinese NEV sales have increased 270 times between 2012 and 2021. According to the China Passenger Car Association, it is estimated that some 6.5 million NEVs will be sold in China this year, up more than 80% from 2021.

Meanwhile, Chinese NEV exports continued to grow. From January to August this year, 341,000 NEVs were exported, contributing 26.7 percent to China’s auto exports, according to the latest data from the China Association of Automobile Manufacturers.

At the same time, Chinese automakers are also actively building overseas vehicle production plants to increase capacity and reduce transportation costs. BYD, for example, said on Sept. 8 that it would build its first overseas passenger car plant in Thailand, fully invested by the company.

BYD’s Thai plant will use the most advanced straight-steer vehicle technology and is expected to start operations in 2024, with an annual capacity of around 150,000 vehicles. Car production will initially supply the Thai market, before expanding to neighboring ASEAN members and other regions, according to a statement sent by BYD to the Global Times.

BYD also sounded out initial plans to build an assembly plant in India in the future.

Growing intelligence

As a high-end terminal in the NEV industry chain, intelligent vehicles and the Internet of Vehicles are key areas for the entire industry. Smart NEVs will be part of building smart cities.

“China’s self-driving technology is now in full swing in the freight industry. In addition, realizing autonomous driving requires the basics of smart transportation and building smart cities, and China already has the basic development conditions,” said Zheng Lei, chief economist of Samoyed Cloud Technology Group, told the Global Times.