China’s output of EV to grow by 100 percent YoY in 2016 04-19-2016

In March 2016, the Chinese government said that the domestic output and sales volume of EV are supposed to grow by 100% YoY this year. This will definitely drive up the demand for power Li-ion battery and accelerate the structure adjustment in China’s Li-ion battery industry.


             Source: Baidu


On 14 March, 2016, Miao Wei, the minister of Ministry of Industry and Information Technology of the People’s Republic of China (MIIT), said that China’s electric vehicle (EV) industry is developing rapidly, and this year the output of EV is expected to be twice of the 379,000 units in 2015.

 

Growth rate of EV output is beyond expectation



According to the Chinese government’s previous plan, the EV penetration in China should reach 5 million units by 2020. But it is very likely that the result will go far beyond this target. Suppose a 100% YoY growth rate in 2016, and a CAGR of 30% in 2017-2020, then by 2020, the domestic EV penetration will reach 6.6 million units, much higher than expectation, according to MIIT’s latest estimation.


 


However, the production of EV has slowed down slightly in Jan.-Feb. 2016, because the Chinese government was strictly fighting against subsidy cheating and suspended the application of ternary Li-ion battery in passenger cars. Given this, to achieve the goal of doubling the output from 2015, the government may need to introduce some more policies to support the further development of EV industry.


 

Strong demand for power Li-ion battery



The rapid development of EV will also drive up the demand for power Li-ion battery. And the production of battery won’t be dragged by the bottleneck problem of technology. MIIT promised that it would help solve this problem and provide solutions to improve battery capacity, security and life span, so as to guarantee a long driving range.


 

Prices of lithium carbonate and LiPF6 will continue to rise



Recently in China, the prices of lithium carbonate and lithium hexafluorophosphate (LiPF6) have been rising continuously as a result of the strong demand and the tight supply. It is beneficial for those enterprises engaged in relevant businesses.


Currently, the domestic quotations of industrial grade lithium carbonate and battery grade lithium carbonate are USD19,882–22,941/t (RMB130,000–150,000/t) and USD26,000/t (RMB170,000/t), respectively, with the MoM growth rates >5%.


And the quotation of LiPF6 is mainly about USD64,235/t (RMB420,000/t).


In addition, domestic electrolyte producers also significantly raise the quotations of their products, so as to make up the rising cost of raw materials.




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Tag: electric vehicle, Li-ion battery




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