In 2015, the investment into 18650 power Li-ion battery sees an upsurge in China, thanks to the rapid development of the alternative energy vehicle industry, according to CCM. As new production lines are put into operation, the current industry pattern will be broken - small- and mid-sized enterprises only reliant on price advantages will be knocked out successively.
Source: Bing
In 2015, China's alternative energy vehicle industry sees explosive growth. According to statistics from the Ministry of Industry and Information Technology, the cumulative output reached 279,200 units in January-November, up by 400% YoY. Under this, the supply of power Li-ion battery is short. "The supply shortage should reach about 2 Gwh', said Fang Jianhua, president of Hefei Guoxuan High-Tech Power Energy Co., Ltd.
In H2, the upsurge of investment into power Li-ion battery appears. Specifically, 18650 battery, featured with mature technology, great flexibility in different battery packs and distinct cost advantage, becomes the favourite in the market. According to CCM's monitoring, from August to mid-December, there were 5 listed companies, such as Hengdian Group DMEGC Magnetics Co., Ltd. and Zhejiang Great Southeast Corp Co., Ltd., invested in 18650 battery by means of project construction, M&A, capital increase for share participation, etc. In total, the input into their new projects reached over USD1.02 billion (RMB6.50 billion).
In view of application, 18650 battery has already been used mainly in mini electric vehicle, and gradually in electric logistics vehicle and electric passenger vehicle, according to CCM research. "In the future, it may be applied in high-speed electric vehicle and even alternative energy bus fields', stated Dai Zheng, general manager of Cham Battery Technology Co., Ltd.
New 18650 power Li-ion battery projects launched by 5 listed companies in China, August-December 2015
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Company
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Time for announcement
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Investment
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Remark
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Hengdian Group DMEGC Magnetics Co., Ltd.
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2015.12.18
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USD65.65 million (RMB420 million)
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Capacity designed to reach 100 million unit/a;
Sales expected to hit USD126.93 million (RMB812 million) annually
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FSPG High-Tech Co., Ltd.
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2015.12.17
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USD86.88 million (RMB558 million)
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Capacity designed to reach 100 million unit/a
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EVE Energy Co., Ltd.
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2015.11.12
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USD93.79 million (RMB600 million)
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Capacity designed to reach 328 million unit/a
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Guangdong Dynavolt Power Technology Co., Ltd.
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2015.10.7
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USD468.95 million (RMB3 billion)
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Capacity designed to reach 6 billion Wh/a, including battery cell and battery pack;
Output value expected to hit USD1.09 billion (RMB7 billion)
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Zhejiang Great Southeast Corp Co., Ltd.
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2015.8.30
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USD312.63 million (RMB2 billion)
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Capacity designed to reach 750 million Ah/a
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Source: Company announcements & CCM
The investment craze facilitated by listed companies probably will lead to overcapacity in the domestic power Li-ion battery segment in 2016. According to statistics from the research institute EVTank, the production capacity under operation of major Chinese power Li-ion battery companies totalled 21.7 Gwh/a by the end of 2015. Further, there is 59.6 Gwh/a under construction, excluding those launched by small- and mid-sized enterprises (SMEs). However, the demand for power Li-ion battery will be about 30 GWh in 2016, according to industry experts.
CCM believes that, the SMEs reliant on price advantages but lack of advanced technology will be knocked out of the market, whilst those competitive in capital, technology, brand and channels, will grow stronger rapidly, as the new 18650 battery production lines are put into operation.
If you would like to know more about the 18650 power Li-ion battery market, you could have a look at: China Li-ion Battery News.
About CCM:
CCM is the leading market intelligence provider for China's agriculture, chemicals, food & ingredients and life science markets. Founded in 2001, CCM offers a range of data and content solutions, from price and trade data to industry newsletters and customized market research reports. Our clients include Monsanto, DuPont, Shell, Bayer, and Syngenta. CCM is a brand of Kcomber Inc.