China’s global battery ram will be hard to stop.
China’s electric cars have zoomed into a new era of battery-powered driving. Now models such as BYD’s (002594.SZ), opens new tab Seal and Great Wall Motor’s (601633.SS), opens new tab Funky Cat face an international backlash. The U.S. is quadrupling duties on imports of electric vehicles from the People’s Republic to more than 100%, while the European Union is lifting total tariffs close to 50% for some marques. The Chinese-made batteries that power the vehicles are an obvious next target for trade restrictions. But that battle will be even harder for the West to win.
China is a battery powerhouse. The $115 billion Contemporary Amperex Technology (300750.SZ), opens new tab and its smaller compatriots accounted for two-thirds of the global market for power cells used in electric cars in the first half of 2024, Bernstein analysts reckon. Companies from the People’s Republic are also growing faster: installations by SVOLT Energy Technology more than doubled in the period from January to June, while those from rivals CALB (3931.HK), opens new tab, Guoxuan (002074.SZ), opens new tab, CATL and BYD all grew by more than a fifth compared to 2023. They’re profitable too, with CATL raking in more than 40 billion yuan ($5.6 billion) in earnings last year.
Much of that output is exported: the total volume of lithium battery units leaving China roughly doubled between 2015 and 2023, according to the International Trade Centre. The U.S. and Europe have become major buyers of Chinese cells, squeezing local operators like Sweden’s Northvolt.
THE BACKLASH
LEAP OF FAITH
BRAWN AND BRAINS
NO ROOM FOR COMPLACENCY
READ the latest Batteries News shaping the battery market
China’s global battery ram will be hard to stop. source