Currently, CATL is the largest power battery manufacturer in China and the world. In the Chinese power battery market, CATL accounts for almost half of the market share; in the global market, CATL also occupies a relatively high share, approximately one-third. Even so, if CATL wants to maintain its position as the market leader for a long time and does not want to be counterattacked or surpassed by its opponents, it is obvious that it needs to continue to work hard and move forward, especially in terms of technology and production capacity, to continue to maintain its leading edge over its peers.
An article on the Internet wrote that anyone who knows the history of CATL’s fortune knows that CATL was able to rise rapidly due to the popularity of ternary lithium batteries, and even once surpassed lithium iron phosphate batteries. BYD, the leader in the field, was trampled underfoot. Taking into account the market environment and policies at that time, CATL can be said to have fully exploited the dividends brought by the high energy density of ternary lithium batteries.
However, in April this year, CATL Chairman Zeng Yuqun said that CATL will gradually increase the proportion of lithium iron phosphate battery production capacity in the next 3 to 4 years, while the production capacity of ternary lithium batteries will gradually decrease. So, for what reason did Ningde Times, which previously regarded lithium iron phosphate batteries as "stinking shit", now turn to regard lithium iron phosphate batteries as "hot cakes"?
After three years, lithium iron phosphate batteries have overtaken ternary lithium batteries for the first time. The latest data shows that in May this year, domestic power battery production totaled 13.8GWh, a year-on-year increase of 165.8% from May 2020, and a month-on-month increase of 6.7% from April 2021. Among them, the output of lithium iron phosphate batteries was 8.8GWh, accounting for 63.6% of the total output this month, a year-on-year increase of 317.3%, and a month-on-month increase of 41.6%; during the same period, the output of ternary lithium batteries was 5.0GWh, accounting for 36.2% of the total output this month, a year-on-year increase 62.9%, a month-on-month decrease of 25.4%. In other words, in 2021, the output of lithium iron phosphate batteries will exceed that of ternary lithium batteries for the first time. It is worth noting that from January to May 2021, the cumulative output of lithium iron phosphate batteries was 29.9GWh, accounting for 50.3% of the total output, a cumulative year-on-year increase of 360.7%; the cumulative output of ternary lithium batteries was 29.5GWh, accounting for 50% of the total output. 49.6%, a year-on-year cumulative increase of 153.4%. It can be seen that with the production overtake in May, lithium iron phosphate is currently temporarily leading the ternary lithium battery in total production.
In May this year, domestic power battery installed capacity was 9.8GWh, a year-on-year increase of 178.2%. Among them, the installed capacity of lithium iron phosphate batteries was 4.5GWh, accounting for 45.9% of the total installed capacity; at the same time, the installed capacity of ternary lithium batteries was 5.2GWh, accounting for 53% of the total installed capacity. According to predictions by industry insiders, the installed volume of lithium iron phosphate batteries is expected to exceed that of ternary lithium batteries in June 2021, returning to the top position in the power battery market. From January to May 2021, the cumulative installed volume of lithium iron phosphate batteries reached 17.1GWh, accounting for 41.3% of the total installed volume; the cumulative installed volume of ternary lithium batteries reached 24.2GWh, accounting for 58.5% of the total installed volume.
As the two major technical routes in the current power battery field, there is almost a trade-off between lithium iron phosphate batteries and ternary lithium batteries. Because of their higher energy density, ternary lithium batteries have become popular in recent years and even tend to overshadow lithium iron phosphate batteries. But in comparison, lithium iron phosphate batteries have two obvious advantages-lower cost and higher safety.
In fact, since the market share was surpassed by ternary lithium batteries for the first time in 2018, the market share of lithium iron phosphate batteries has gradually declined. According to data from the Power Battery Alliance, the cumulative production of domestic power batteries in 2018 reached 70.6GWh, of which ternary batteries accounted for 55.5% and lithium iron phosphate batteries accounted for 39.7%; during the same period, the installed volume of ternary lithium batteries and lithium iron phosphate batteries They were 33.1GWh and 22.2GWh respectively, accounting for 58.1% and 39% of the installed capacity respectively. Industry insiders pointed out that behind the "twisting and twists" in the market share of lithium iron phosphate batteries, perhaps the most critical factor is cost.
At the end of 2016, the state adjusted its subsidy policy for the promotion of new energy vehicles and included battery energy density into the subsidy reference index for the first time.
At that time, the energy density level of lithium iron phosphate batteries was mainly concentrated around 70Wh/kg~80Wh/kg, which was consistent with "the mass energy density of pure electric passenger car power battery systems is not less than 90Wh/kg, and for batteries higher than 120Wh/kg There is a big gap in the standard of "1.1 times subsidy", so they are unable to enjoy this wave of policy preferences, and are gradually being surpassed by ternary batteries with higher energy density.
However, subsidies for new energy vehicles will be reduced by an average of about 50% in 2019, making it possible for lithium iron phosphate batteries to compete with ternary lithium batteries again. In April 2020, the "Notice on Improving Fiscal Subsidy Policies for the Promotion and Application of New Energy Vehicles" proposed to extend the subsidy period to the end of 2022. In principle, the subsidy standards from 2020 to 2022 will be reduced by 10% and 20% respectively based on the previous year. ,30%. As a result, more and more companies are beginning to consider lithium iron phosphate batteries, which have more cost advantages than ternary batteries. Not only that, after BYD's blade battery came out in 2020, lithium iron phosphate batteries have been enthusiastically sought after by the market, demand has increased, and the production of lithium iron phosphate batteries has also continued to rise.
Data from the Power Battery Alliance shows that throughout 2020, domestic power battery production totaled 83.4GWh (including the production part of power battery companies’ overseas bases), a cumulative year-on-year decrease of 2.3%. Among them, the output of lithium iron phosphate batteries increased against the trend, with the cumulative output reaching 34.6GWh, a cumulative increase of 24.7% year-on-year; the cumulative output of ternary lithium batteries reached 48.5GWh, a cumulative decrease of 12% year-on-year.
CICC’s latest research report points out that the penetration rate of lithium iron phosphate batteries is expected to increase to 45~50% in the future. In addition, in overseas markets, giants including Tesla, Volkswagen, Apple and other companies have stated that they are beginning to consider the possibility of installing lithium iron phosphate batteries in new energy models in the future. Some international market research institutions even predict that lithium iron phosphate batteries are expected to surpass ternary lithium batteries and dominate the market in the next 10 years.
At the 2021 China Automobile Chongqing Forum on June 13, Wang Chuanfu, chairman and president of BYD Co., Ltd., said that China’s own brand electric vehicles have surpassed foreign investment in technology. In May of this year, the output of lithium iron phosphate batteries has surpassed that of ternary lithium batteries. BYD Blade Battery has single-handedly pulled lithium iron phosphate batteries back from their marginalized position in the market. The battery production capacity of the Chongqing Bishan factory has reached 20GWh and will reach 35GWh by the end of the year.
According to a research report from Huaan Securities, under extreme calculations, lithium iron phosphate batteries have 55% and 22% cost advantages over ternary batteries at the cathode and cell levels respectively. Under the current subsidy plan, even taking into account the difference in subsidies, switching from ternary to iron-lithium batteries will bring about a 9 to 11% cost reduction. This cost reduction effect will be more significant after the subsidy is reduced in 2021. . Driven by cost, major car companies have launched lithium iron phosphate models one after another.
In addition to the increasing number of car models equipped with lithium iron phosphate batteries, the price of lithium iron phosphate can also reflect the surge in market demand. Data from Guohai Securities Research Institute shows that the price of lithium iron phosphate has rebounded since October 2020, increasing from a low of 32,000 yuan/ton to 51,000 yuan/ton in May, an increase of more than 59% in more than half a year. . According to the Huaan Securities Research Report, 2021 will be a big year for demand growth for lithium iron phosphate, with an expected year-on-year growth of 80%.
A few years ago, before charging piles and fast charging technology became popular, the actual cruising range of pure electric vehicles could basically determine the user's travel range. As charging piles and fast-charging technology continue to become more popular, consumers' requirements for new energy vehicles' battery life are no longer as strong as they were in the early days, so the biggest advantage of ternary lithium batteries has gradually become less dazzling.
Also because endurance is no longer the only requirement for new energy vehicles, the safety weaknesses of ternary lithium batteries have become increasingly prominent. In recent years, lithium iron phosphate batteries have not only given full play to their safety advantages, but also made up for the lack of energy density through CTP technology.
CATL now chooses to increase its lithium iron phosphate battery production capacity and reduce its ternary lithium battery production capacity, basically in order to remain invincible in the market. As Zeng Yuqun himself said before: "The entire industry chain of Ningde era is doing this. As a role that builds a platform, you can't be biased.
Nowadays, with the increasing popularity of charging piles, the cruising range of electric vehicles is no longer required to be very long. At this time, the growth rate of lithium iron phosphate batteries will accelerate due to their low cost. Therefore, in terms of proportion, lithium iron phosphate batteries may gradually increase in the future, while ternary batteries have a smaller percentage, but they will not disappear completely. Because some high-end cars with high energy density and high endurance still need the support of ternary batteries. However, lithium iron phosphate must be of great use. ”
From a technical perspective, CATL is quite competitive in the entire battery industry. (Quote from a report issued by Century Securities)
First of all, CATL attaches great importance to Research and development of products and technical processes. The absolute value of the company's R&D expenses is significantly higher than that of other companies in the industry. In 2020, the expenditure was 3.569 billion yuan, with a five-year compound growth rate of 33.2%. The proportion of R&D expenditures in operating income remained at around 7%, which was low after 2017. Compared with peer companies, this is mainly due to the fact that the company's operating revenue scale and growth rate lead the industry. Compared with another major international power battery giant, South Korea's LG Chem's R&D investment in the battery sector in 2020 was 2.42 billion yuan, with a five-year compound growth rate of 9.7%. The expense rate is only 3.3%. The company has a complete R&D system covering product research and development, engineering design, testing verification, process manufacturing and other fields, and maintains the company's product competitiveness by continuously improving product performance and product quality.
Secondly, as of the end of 2020, the company has 5,592 R&D technicians, accounting for 18.16%, including 127 with doctoral degrees and 1,382 with master's degrees. The overall R&D team size and strength are leading the industry. Mainly, supplemented by extensive and in-depth cooperation, it has established a multi-department, internal and external collaborative R&D model, and built a standardized, standard, efficient and sustainable R&D system. As of the end of 2020, the company and its subsidiaries *** have 2,969 domestic patents. and 348 overseas patents, and 3,454 domestic and overseas patents are being applied for. We believe that the company's technological advantages will still be maintained in the long term.
Third, the company already has four major R&D centers and five major production lines. base, R&D strength and production capacity. Domestically, the company has completed a layout with Ningde Times as the center and subsidiaries such as Qinghai Times, Jiangsu Times and Sichuan Times as important pillars. At the same time, in 2014, the company occupied half of the domestic power battery industry. In 2018, the company established its first overseas subsidiary, Time in Germany, and then gradually improved its global layout, successively establishing subsidiaries such as Time in America, Time in France, and Time in Japan. In 2018, the company started building its first overseas production base in Germany to expand globally. Strengthening, the company has successfully transformed into a global leader in the power lithium battery industry in 10 years.
Finally, the company has a clear long-term technical roadmap, and the current product performance upgrades are basically in line with expectations. The core idea of ??developing the battery business is that ternary lithium products are mainly used in high-end passenger cars. Currently, a pattern of NCM523 products being the main product and NCM811 being the high-end products has been formed, while lithium iron phosphate products are mainly used in mid- to low-end passenger cars. , commercial vehicles and energy storage fields. The cost of battery packs mainly comes from cell materials and structural parts, and both of them affect the performance of the battery system. The company firmly grasps the concept of "high specific energy, long life, and ultra-fast charging." , true safety, self-temperature control" five core competitiveness of power batteries, innovating battery structure and material technology, supplemented by intelligent system management, achieving cost reduction and efficiency improvement, and solving the problem of short cruising range, short battery life, long charging time and poor low temperature performance. , poor safety performance and other user pain points.
Finally, I have to mention the next generation of battery technology—all-solid-state batteries. All-solid-state batteries use solid materials as electrolytes that move lithium ions back and forth that carry electricity. Compared with lithium batteries using electrolyte, they are less prone to short circuit and have less risk of fire. It is characterized by the alternating arrangement of electrodes and electrolytes, making it easy to stack. Therefore, the energy density per unit weight is higher than that of existing lithium batteries. When the battery size is the same, the cruising range of pure electric vehicles can be improved.
However, one of the important problems with all-solid-state batteries is that the current cost is considered by the industry to be more than four times higher than that of lithium batteries. According to estimates by Ford Motor Company in the United States, the current cost of lithium batteries for pure electric vehicles is about 13,000 yen per kilowatt-hour, and will drop to less than 10,000 yen by 2030.
Some overseas manufacturers hope to take the lead in mastering all-solid-state battery technology and enter mass production into the market earlier, thereby trying to save the situation in the power battery market.
(I organized it for technology geeks)