A brief analysis of the logic behind the expansion of BYD power battery

In 2018, China's sales of new energy vehicles rose steadily. In August, the sales of new energy passenger vehicles sold 84,000 vehicles, an increase of 61.7 kilometers year-on-year. In contrast, the installed capacity of power cells is also growing rapidly year-on-year. According to statistics, in August, the installed power battery capacity of new energy vehicles in China was about 4.17 GWh, an increase of 24.9 %, a year-on-year increase of 43.44 %

With the rapid development of the new energy automotive market, the polarization of the Chinese power battery market has become increasingly evident. On the one hand, power battery production capacity has been further concentrated in the Ningde era and BYD and other industrial giants. On the other hand, the power battery companies of the second echelon are speeding up the reshuffle. Then there will be a similar crisis for companies like Woterma.

It is worth noting that in this context, the head power battery company is still stepping up its capacity expansion. Take BYD as an example, from the expansion of the 24GWh project in Xining, Qinghai Province in June this year, to the recent construction of the 30GWh power battery project in Xi'an. BYD's capacity to invest in power cell expansion projects reached 74GWh in a short period of three months from June to September.

Next, take a look at three major new power cell projects that BYD built from June to September this year.

Qinghai Xining 24GWh Power Battery Project

On June 27, BYD's 24GWh power battery factory officially went offline in Xining, Qinghai. At the same time, BYD announced that the total power battery capacity will increase to 60 GWh by 2020.

The logic behind the 74GWh BYD power battery expansion

It is understood that the production capacity of the first-phase project of this giant battery factory has been successfully delivered. After it is fully put into operation in 2019, the annual production capacity of Qinghai Xining Nan chuan Power Battery Factory can reach 24 GWh, which will become the world's largest power battery factory. If BYD's newly launched new generation of "Don"(plug-in hybrid version) batteries are calculated as 20K Wh/vehicle, it is equivalent to meeting the battery demand of 1.2 million "Tang" units.

In order to prepare for the full opening of the power battery business, BYD is actively stockpiling in product technology and production capacity. On the one hand, it has increased the proportion of ternary power batteries. Its Xining Nan chuan Power Battery Plant plans to produce ternary batteries. On the other hand, in terms of production capacity planning, Its planned power battery capacity is expected to reach 60 GWh by 2020, which exceeds the 54GWh planned in the Ningde era.

Construction of 20GWh Power Battery Project in Bishan, Chongqing

On August 23, BYD signed an investment cooperation agreement with Chongqing Bishan District and plans to invest 10 billion yuan to build a power cell project with an annual capacity of 20 GWh, which mainly includes core power cell cores, modules, and related supporting industries. Product manufacturing. At the same time, the Southwest Regional Headquarters will be built through projects such as priority layout Motors, electronic control systems, and rail transit equipment manufacturing.

Xi'an Investment and Construction of 30 GWh Power Battery Project

On September 9, the construction of the Yun-rail demonstration line project and the signing ceremony of the BYD 30 GWh power battery project were held in Xi'an High-tech Zone.

The logic behind the 74GWh BYD power battery expansion

The annual investment of BYD's 30 GWh power battery project in Xi'an is 12 billion yuan. It is the largest power battery project currently invested and planned by BYD. After completion, it will become a "super factory" in the industry. It can further ease the shortage of production capacity of high-end power batteries in the world and promote the healthy and high-speed development of the new energy automotive industry.

Production expansion preparation to contain the Ningde era a dominant family?

Judging from the investment in the above three major power battery projects, BYD's planned new power battery production capacity reached 74GWh in just three months. If the existing production capacity of BYD is added, if the proposed production capacity is put into production, BYD's total power battery production capacity will reach 100 GWh.

Why is BYD so aggressively expanding its capacity? This has much to do with its own surge in new energy car sales.

In the newly released August sales of new energy vehicles, BYD's new energy passenger vehicles showed a continuous trend of sales. Sales exceeded the 20,000 mark for the first time, reaching 20,845 vehicles, a year-on-year growth of 85 vehicles, and continued to lead the new energy industry.

In addition, BYD power batteries began to be supplied to the outside world and cooperated frequently with the host factory. Such as Chang 'an, Dong feng, Great Wall and so on. BYD is also preparing to split the power battery business, and there will be significant demand for BYD's power batteries in the future. This has further boosted its capacity expansion. The main machine factory is also happy to add a powerful power battery supplier to avoid being a dominant situation in the era of Ningde.

Big effect shows power battery industry accelerates polarization

BYD's large expansion is in line with the rapid expansion of the power battery industry and the rapid reduction of costs.

According to statistics, in 2017, China's power type lithium battery shipments reached 39.1 GWh, accounting for the total size of the lithium industry about 50 <UNK>. Among them, the shipment of automotive power batteries reached 38 GWh, accounting for 65.4 <UNK> of global automotive power battery shipments. There have also been some breakthroughs in technology. For example, the energy density of the power cell monomer exceeds 240Wh / kg, while the battery monomer decreased from 5 yuan per watt in 2012 to about 1.2 yuan per watt.

On the other hand, the global power battery production capacity quickly concentrated on the top companies. According to statistics, the top ten companies in 2017 accounted for 80 shipments. Industry competition has extended from downstream customers to upstream materials and resources industries. Japanese and Korean companies will accelerate their competition for China's market share, and Chinese battery companies will also compete with international mainstream companies through mergers, acquisitions, restructuring, and standard setting.

In this context, the power battery market is tight and overcapacity coexists. According to the data, in 2017, China's power battery capacity has exceeded 200 GWh, but the overall capacity utilization rate is only 40. There is marked polarization, excess structural capacity, insufficient supply of high-quality production capacity at the high end and insufficient orders for low-end production capacity.

"The market will be more concentrated in the dominant companies, and small, low-level power cell companies will be eliminated in the competition. According to the data, the number of Chinese power battery companies has dropped from about 150 in 2015 to about 100 in 2017, and one-third of them have been eliminated. "Chen Qingtai, chairman of the China 100 Electric Vehicles Association, believes that as competition intensifies, the power battery industry will accelerate polarization under the giant effect.

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