A quick talk on overcapacity of lithium batteries - Lithium - Ion Battery Equipment
With the end of the 2018 interim report disclosure period, several domestic power lithium battery head companies such as CATL, BYD and Guoxuan Hi-Tech have all handed in their transcripts for the first half of 2018. Judging from the situation of several leading companies, many companies in the industry have shown the common feature of "increasing revenue and reducing profits" in the past six months.(Lithium - Ion Battery Equipment)
On the one hand, new energy vehicles are in a period of great development. According to the country's plan to add 2 million new energy vehicles and retain 5 million new energy vehicles in 2020, the annual new increase can bring about a 30%-40% growth rate of the industry. If you consider the replacement of stocks, the actual growth rate is even higher. , So that the income of each company has increased with the continuous expansion of the industry.
On the other hand, the industry is also in a moment of tragic reshuffle. Not only the ranking of top companies is constantly changing, but companies that have left behind and new dark horses are also emerging in an endless stream. With the drastic changes in the industry structure, the degree of concentration has increased significantly and the oligarchic situation has become increasingly obvious.
▍It is imperative to clear the industry with a production capacity three times the demand
Stimulated by both policies and demand, since 2017, major power lithium battery manufacturers have begun to vie for financing, continue to increase investment in new plants and new production lines, and expand production capacity to seize the market. As a result, various battery companies quickly fell into a "prisoner's dilemma" and entered a state of capacity competition, with a serious overcapacity overall.
Take the top listed companies in the industry as an example.
CATL's production capacity exceeded 17Gwh at the end of 2017. After that, only the IPO fundraising project part will add another 24Gwh of production capacity. At the end of 2018, the company's total production capacity will reach 38Gwh. By the end of 2020, according to the existing capacity planning of CATL, the total production capacity will reach 80Gwh. Even if conservatively estimated, the total production capacity will be above 50Gwh.
BYD once stated in the Investor Relations Activity Record that as of the end of 2017, the battery production capacity was 16Gwh. It is expected to expand the ternary battery capacity of 10Gwh in Qinghai in 2018, and the total production capacity will reach 26Gwh by the end of 2018. The production capacity is expected to reach 40Gwh.
Another listed company, Guoxuan High-Tech, said that it is expected that the output of power batteries can reach 8-9Gwh in 2018, and the overall production capacity can reach 13-14Gwh. By the end of 2020, the production capacity is expected to be around 20Gwh.
According to statistics, the above three leading companies, plus other large and medium-sized power battery manufacturers including Yiwei Lithium Energy, BAK Power, Tianjin Lishen, Penghui Energy, Beijing Funeng, and Mengshi Technology, will have the capacity by 2020 The total will be close to 300Gwh. If an average charge of a new energy vehicle is estimated at 50 degrees (50Kwh), these capacity alone can meet the battery demand of nearly 6 million new energy vehicles.
According to the "Medium and Long-term Development Plan for the Automobile Industry" jointly issued by the Ministry of Industry and Information Technology, the National Development and Reform Commission, and the Ministry of Science and Technology, and the related "Thirteenth Five-Year Plan", by 2020, the domestic production and sales target of 2 million new energy vehicles , The production capacity is three times the demand, and the surplus is serious.
Due to oversupply, especially the overcapacity of low-end products, the price of power batteries including ternary and lithium iron phosphate has plummeted from more than 2.8 yuan/wh in early 2014 to about 1.2 yuan/wh in mid-2018. wh, it fell by 60% in 4 years, and it is imperative to clear the industry.
On the one hand, new energy vehicles are in a period of great development. According to the country's plan to add 2 million new energy vehicles and retain 5 million new energy vehicles in 2020, the annual new increase can bring about a 30%-40% growth rate of the industry. If you consider the replacement of stocks, the actual growth rate is even higher. , So that the income of each company has increased with the continuous expansion of the industry.
On the other hand, the industry is also in a moment of tragic reshuffle. Not only the ranking of top companies is constantly changing, but companies that have left behind and new dark horses are also emerging in an endless stream. With the drastic changes in the industry structure, the degree of concentration has increased significantly and the oligarchic situation has become increasingly obvious.
▍It is imperative to clear the industry with a production capacity three times the demand
Stimulated by both policies and demand, since 2017, major power lithium battery manufacturers have begun to vie for financing, continue to increase investment in new plants and new production lines, and expand production capacity to seize the market. As a result, various battery companies quickly fell into a "prisoner's dilemma" and entered a state of capacity competition, with a serious overcapacity overall.
Take the top listed companies in the industry as an example.
CATL's production capacity exceeded 17Gwh at the end of 2017. After that, only the IPO fundraising project part will add another 24Gwh of production capacity. At the end of 2018, the company's total production capacity will reach 38Gwh. By the end of 2020, according to the existing capacity planning of CATL, the total production capacity will reach 80Gwh. Even if conservatively estimated, the total production capacity will be above 50Gwh.
BYD once stated in the Investor Relations Activity Record that as of the end of 2017, the battery production capacity was 16Gwh. It is expected to expand the ternary battery capacity of 10Gwh in Qinghai in 2018, and the total production capacity will reach 26Gwh by the end of 2018. The production capacity is expected to reach 40Gwh.
Another listed company, Guoxuan High-Tech, said that it is expected that the output of power batteries can reach 8-9Gwh in 2018, and the overall production capacity can reach 13-14Gwh. By the end of 2020, the production capacity is expected to be around 20Gwh.
According to statistics, the above three leading companies, plus other large and medium-sized power battery manufacturers including Yiwei Lithium Energy, BAK Power, Tianjin Lishen, Penghui Energy, Beijing Funeng, and Mengshi Technology, will have the capacity by 2020 The total will be close to 300Gwh. If an average charge of a new energy vehicle is estimated at 50 degrees (50Kwh), these capacity alone can meet the battery demand of nearly 6 million new energy vehicles.
According to the "Medium and Long-term Development Plan for the Automobile Industry" jointly issued by the Ministry of Industry and Information Technology, the National Development and Reform Commission, and the Ministry of Science and Technology, and the related "Thirteenth Five-Year Plan", by 2020, the domestic production and sales target of 2 million new energy vehicles , The production capacity is three times the demand, and the surplus is serious.
Due to oversupply, especially the overcapacity of low-end products, the price of power batteries including ternary and lithium iron phosphate has plummeted from more than 2.8 yuan/wh in early 2014 to about 1.2 yuan/wh in mid-2018. wh, it fell by 60% in 4 years, and it is imperative to clear the industry.
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