Lithium power investment has increased, and domestic power battery demand is about 100 GWh in 2020.

With the rise of new energy vehicles, China's power battery industry has entered a rapid growth phase since 2014, with shipments increasing from 3.7 GWh in 2014 to 30.5 GWh in 2016, with a compound growth rate of 288 %. Affected by the receding of new energy subsidies in 2017, the growth rate of power battery shipments dropped to 19 %, and the annual shipment volume was 36.2 GWh.

According to statistics, as of the end of 2017, the total domestic power battery production capacity reached 135GWh, and the effective production capacity was 110 GWh. However, the annual power battery shipment volume was only 36.2 GWh, and the average capacity utilization rate was less than 40 %. The capacity utilization rate of leading enterprises can be estimated at 80 %, and the capacity utilization rate of some small and medium-sized enterprises is only 10 %. The low-end excess capacity is obvious. In the next two years, first-line battery manufacturers will still have new production capacity. It is expected that the total power battery production capacity in 2018 and 2020 will reach 206 GWh and 285 GWh, respectively. In the same period, the demand for power batteries will be 47 GWh and 97 GWh, respectively. Technical backwardness, lack of stable vehicle customers small production capacity will be eliminated.

In November 2016, the Ministry of Industry and Information Technology issued the "Standard Conditions for the Automobile power battery Industry"(2017)(Consultation Draft), which significantly increased the annual production capacity of lithium-ion power battery monomer enterprises from 0.2 GWh to 8GWh. At present, only five enterprises have reached the production capacity standard. According to the plans announced by various manufacturers, 14 companies will meet the production capacity targets by 2020. The number of power battery companies dropped for the first time in 2017, and the effect of small production capacity was first realized. Under the background of low prices and profit bearing pressure, it is difficult for small and medium-sized enterprises to expand production. It is expected that domestic power battery demand will be about 100 GWh in 2020, and there will be no more than 20 power battery manufacturers.

More than 90 % of global power cell production capacity is concentrated in China, Japan and the ROK. Japan has invested heavily in lithium battery research since the 1990s. South Korea quickly followed suit in the 21st century, and China came to the top nearly two years later. Japanese Panasonic, South Korean LG Chemical, and Samsung SDI basically monopolize the supply of power batteries for Japanese and Korean and European mainstream car companies. With the promotion of technology and policies, sales of new energy vehicles in China rose rapidly to 49 % of the global total sales of new energy vehicles in 2017, which led to a rapid increase in upstream power battery production and sales. In the top 10 global power battery sales in 2017, domestic companies accounted for seven seats, totaling 47 % of the global market share. Among them, CATL power cell sales of 11.82 GWh, the global market share of 17 %, surpassing Panasonic Electric to become the world's largest power battery manufacturer. In addition to supplying domestic vehicle manufacturers, Chinese companies began to seek cooperation with world-class vehicle companies. CATL has entered the BMW and Volkswagen supply chains and has directly competed with Japanese and Korean companies in the international market.

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