October 10, 2011 — BUSINESS WIRE — CCID Consulting released a white paper on China’s lithium-ion (Li-ion) battery industry, as the country seeks to promote new energy technologies for automobiles (electric vehicles) and other needs.
In 2010, China’s lithium ion battery market hit RMB 27.61 billion, an increase of 37.9% compared with 2009. China produced 3.67 billion lithium ion batteries in 2010, an increase of 33.9% compared with 2009. China determined in October 2010 to cultivate new energy technologies to lead the national economy. China’s lithium-ion battery industry will grow rapidly in the country’s Twelfth Five-Year Plan, CCID Consulting reports.
The country will spend RMB100 billion on new-energy vehicles between 2011 and 2020, with lithium-ion batteries at the heart of the sector. Shanghai’s strong automotive industry will capitalize on this focus.
Regional competition will push local governments to develop high-end technologies. The industry is concentrated on the Pearl River Delta, with a production base for raw materials and low-cost labor for assembly of lithium ion batteries. In 2010, the output value of lithium ion battery in this region is RMB 7.48 billion, accounting for about 27% of the nation. However, as the inland increasingly lowers the labor costs, the labor-intensive links such as battery core assembly and PACK will gradually move from coastal areas to inland areas.
Map of China’s Li-ion battery industry.
The Bohai Bay is the material and production base of lithium-ion batteries in China. In 2010, the output values of lithium ion battery for these areas reached RMB 4.56 billion. Beijing has achieved remarkable growth in anode materials for lithium ion batteries. Tianjin will become an essential base for the lithium-ion battery industry in the future.
Main upstream ores of lithium ion battery include lithium carbonate, iron, manganese, cobalt, and nickel. China is rich in lithium, next only to Chile and Argentina. The central and western regions offer rich ore fields producing lithium-ion battery raw materials. Regions with rich lithium ore reserves (Yichun Jiangxi, Ngawa Sichuan, Qinghai, Tibet) have "unrivaled conditions" for Li-ion battery development. CCID Consulting believes that with the rapid development of lithium ion battery industry and the expanding of downstream productivity, resource companies will face increasing pressure of supplying. As demand exceeds supply, upstream mineral resources will be of high investment value. Battery material is the bottleneck of lithium ion batteries industrialization.
With high barrier in threshold of market access, technology and other intelligence factors are the major drivers for the rapid development of high-end material of lithium ion battery such as membrane and lithium hexafluorophosphate. Intelligence-intensive eastern regions represented by Beijing, Jiangsu, and Shanghai, therefore, will maintain their monopoly position in high-end battery material based on their leading technologies. Eastern regions will hold even more power as new-energy automobiles gain prominence.
The output of lithium ion batteries from Japan, China, and South Korea accounts for over 90% of the global output. Before 2000, more than 80% of lithium ion batteries were produced in Japan, but China’s good investment environment and cheaper labor is driving an industry shift. Many Japanese, South Korean and Taiwanese enterprises go to China to build their lithium factories. In 2010, China produced over 30% of the global output, and growing.
The development of battery core assembly depends on capital and scale. With mature production technique and technology, most lithium ion battery manufacturers in China can produce cores of lithium ion batteries, on the condition that the raw material supply is guaranteed. However, the production of motive-power battery involves combination of cores, which requests core consistency, more advanced battery production equipment and more investment as a result. Compared with other upstream battery material industries, this industry is labor-intensive, and many domestic and foreign enterprises have stepped into this field.
And what about recycling? As Li-ion production and consumption increase, scrapped lithium ion batteries will create environment pollution. Cobalt in lithium ion batteries offers huge economic value if recovered. With the development of battery recycling and recovery technology, especially the maturity of microorganism metallurgy in handling lithium ion batteries, cobalt, graphite, electrolyte and other metals contained in lithium ion batteries can be recovered.
CCID Consulting summarizes the distributing characteristics of world Li-ion battery industry and its successful development mode; and analyzed the features of domestic distributing and resources. CCID Consulting examines the trends for future development of China’s lithium ion battery industry and the assorted investment values of lithium ion battery in every links of the chain. This provided important guidance for the layout design of the national and local lithium ion battery industry as well as decision making of enterprises. Obtain the white paper at http://en.ccidconsulting.com.