Chinese Companies: Switching to the Production of Lithium Batteries is Imperative

1. The price advantage of lithium-ion battery companies

China started to study lithium-ion batteries in 1990 and successfully developed 18650 batteries for mobile phones and video cameras in 1996. However, because Japanese companies have long occupied a leading position, the Chinese trend at the time was also nickel-hydrogen batteries, and lithium batteries did not have much room for development.

In 2005, Panasonic withdrew from the European and Chinese mobile phone markets, and then many manufacturers began to shrink their smartphone business. While China is taking advantage of the trend, the number of smartphones held by the whole people is increasing, and it has gradually become a global consumer electronics manufacturing center. Supporting lithium-ion batteries also have a huge market prospect, and lithium-ion battery companies also have local advantages because of their low prices.

2. The development of lithium-ion battery technology

In 2002, although Chinese lithium battery companies did not match the technological content of Japan, they already had the capital to grab the cake of Japanese companies. The fate of ignoring the Chinese market is that in just 10 years, China's global market share has expanded from 11% to 33% in 2011, and then in 2012, Japan has slipped to the third place in the world, and China got the leading place.

Although Japan has a leading position in lithium-ion battery technology, it is understandable that Japan has bet on hydrogen fuel cell vehicles in the electric vehicle market. The raw materials required for the production of hydrogen fuel cells in Japan can almost be supplied domestically, but almost all raw materials for lithium-ion batteries need to be imported. It is understandable that electric vehicles are listed as alternatives.

On the contrary, China is rich in resources, has a huge market, and has the world's largest and most complete lithium-ion battery industry chain. China's power battery industry entered a major explosion in 2015. The electric vehicle industry increased from an annual output of 247,500 vehicles to 972,000 vehicles in 2019, which boosted the manufacture of power batteries and finally completed the surpassing of Japan and South Korea.