"There is no good alternative to 'Made in China'. Recently, South Korea's ** "Korea Economy" reported on the difficulties faced by Korean auto companies. As the United States continues to escalate export controls to China, South Korean car companies, which are highly dependent on Chinese battery materials, are having a hard time. To this end, these companies have submitted submissions, calling on the United States to relax the so-called restrictions on China and allow them to purchase key battery materials in China.
On the other side of the globe, the American company Tesla is facing the same problem. Due to the impasse in the mass production of batteries for the Cybertruck, Tesla had to urgently turn to Chinese manufacturers for support from battery components.
At the same time, Mississippi Governor Tate Reeves has also touted on various occasions the second-largest economic development project in the state's history: four companies will spend $1.9 billion to build a power battery factory, of which Chinese battery companies will hold a 10% stake. This is in stark contrast to his previous claims that Chinese technology is an "existential threat."
From Korean companies to American companies, to the business community, they all sent such a message: the development of new energy vehicles cannot be separated from China.
How strong are Chinese batteries?
More than 100 years ago, when Henry Ford revolutionized modern automobile production, engineers from all over the world flocked to the United States. Today, Volkswagen of Germany has sent nearly 300 employees to China to learn battery manufacturing, the Chinese company CATL has helped Ford build a battery factory, and Chinese companies have begun to export technology and brand ...... to foreign capitalThe rise of China's battery industry is bringing profound changes to the global automotive industry.
According to the latest data recently released by China's Ministry of Industry and Information Technology, China's power battery exports will be 127 in 20234 GWh, up 87 percent year-on-year1%, the market size has ranked among the top in the world for 7 consecutive years. Among them, the largest export market is Europe, followed by the United States and Southeast Asia. Not only that, among the top 10 power battery companies in the world in terms of vehicle loading, Chinese companies occupy 6 seats.
Nikkei News has captured the information of more than 13,000 companies related to Tesla from Tesla's financial reports and related press releases through big data, and found that nearly 40% of the materials used in Tesla's electric vehicle batteries are from China. According to the New York Times, because of China's strength in manufacturing power batteries, "the United States cannot even achieve a green economy without China."
The data picture shows workers in Jinzhong, Shanxi, producing cars. (*From China News Agency, Hong Kong).
Strong momentum comes from?
China's power battery industry has achieved such achievements, from multiple competitive advantages.
Cui Dongshu, secretary general of the China Passenger Car Market Information Association, told the "International Review" that China's power battery has irreplaceable industrial advantages. The key main materials for the production of power batteries, such as cathode materials, anode materials, and electrolytes, have all been independently produced in China, forming a complete power battery industry chain. Data shows that in the field of on-board lithium-ion batteries, the market share of Chinese companies exceeds 60%. With the production and sales of new energy vehicles in China accounting for more than 60% of the world's total, ranking first in the world for 9 consecutive years, the development of power batteries has gained more space.
China also dominates the core raw materials needed for battery production. Statistics show that in 2023, more than eighty percent of the global shipments of key materials such as lithium battery electrolytes and separators will come from China. The New York Times has used cobalt, an important metal material in power batteries, as an example, and found that China has an advantage in every link of the electric vehicle battery production chain, from mining to smelting to parts manufacturing, and it may take decades for the rest of the world to catch up.
Tao Lin, Tesla's global vice president, mentioned to the "International Review" that as China's first wholly foreign-owned vehicle enterprise, Tesla's manufacturing advantages are inseparable from China's strong and perfect first-chain system, "In the past 10 years, Tesla has worked with Chinese local enterprises to help the development of China's auto industry and economic globalization, and Tesla's success in China is the success of China's first chain on a larger scale."
At the same time, China's battery products are of stable quality and relatively low cost, especially welcomed by car companies from all over the world. In 2020, Volkswagen became the first foreign car company to directly invest in a Chinese battery manufacturer. According to Volkswagen**, by 2030, the group will reduce the overall cost of battery cells by 30% among all production models in the world, including 50% in the cost of batteries for entry-level models. A Volkswagen official told International Review, "The in-depth cooperation with China's local battery companies has helped us further optimize the cost structure, which is expected to greatly enhance our competitiveness in the battery field."
More importantly, long-term adherence to technological innovation and accelerating the global layout have become the key to the success of Chinese enterprises. According to the data released by the China National Association, at present, China has applied for 74% of the world's power battery patents and has become the largest producer of drive motors.
The relevant person in charge of BYD told the "International Rui Review" that as the world's major battery manufacturer, the company has been deeply engaged in the battery field for more than 20 years, and its products cover power batteries, energy storage batteries and new batteries, and are committed to solving various battery performance shortcomings. Previously, foreign media had tested the charging data of Tesla after being equipped with BYD batteries, and found that the high-power charging time was maintained longer, the charging power was higher, and the energy consumption was reduced.
"Decoupling and breaking the chain" will not work.
The development of China's power battery industry has promoted the green and low-carbon transformation of the global automotive industry, and has gained world reputation for global green development. This makes the attempt by some US politicians to exclud Chinese batteries from the US electric vehicle ** chain, seem out of place.
In recent years, the United States has erected a "high wall" to China's power battery through political intervention and barriers, trying to curb the development of China's emerging industries. For example, the Inflation Reduction Act signed by the United States in August 2022 proposes to provide a tax credit of up to $7,500 per electric vehicle, provided that the vehicle is assembled in North America, and a certain proportion of key raw materials for battery components must be mined or processed in North America. In addition, according to the U.S. National Defense Authorization Act for fiscal year 2024, the U.S. Department of Defense will be banned from purchasing batteries from six Chinese companies, including CATL and BYD.
Relevant experts pointed out to the "International Sharp Review" that the US measures reflect consistent hegemonism and run counter to the world's most fair rules. The United States is suppressing China under the so-called "** banner" and intends to "decouple and break the chain", but considering the unique technological advantages of China's battery industry, the United States cannot stop it. Tesla and other foreign companies urgently asked Chinese companies for help, which is the best proof of this. The active communication and cooperation between US states and China is a concentrated manifestation of public opinion.
In addition, according to the International Energy Agency, the United States has almost no mining or processing capacity for minerals such as lithium, nickel and cobalt, and the output of battery cathode and anode materials is less than 5% of the world's. If China's power batteries are excluded from the chain, it may push up the purchase of electric vehicles by Americans and deviate from the expected goal of the United States. It can be seen that the so-called protection policy of the United States not only harms its own enterprises and undermines market rules, but also makes the American people pay the bill.
Facts have proven that political forces cannot resist the laws of the market. American scholar Jane Nakano pointed out that when it comes to electric vehicle batteries, "the United States still has a lot to learn from China." Bloomberg believes that without China, there would be no "Made in America" electric vehicles, and the United States needs to remain "humble" in this area. The Center for Strategic and International Studies and other institutions in the United States have recently stated that with the strong export of China's power batteries and other products, and the rapid development of many industries, China is still an inseparable market for foreign investors, and it is a powerful driving force for world economic growth. (ENDS).