Chinese Battery Manufacturers Increasing Their Ternary Battery Production Volume

It has been found that Hefei Guoxuan High-tech, one of the five largest battery manufacturers in China, began to produce ternary lithium ion batteries for use in electric vehicles in Hefei, Anhui on August 1.

This Chinese company, which currently has a market share of approximately 10% in the Chinese market, has supplied lithium iron phosphate (LFP) batteries to SAIC Motor, BAIC Motor and the like and this is the first time that Hefei Guoxuan High-tech manufactures ternary batteries. Recently, JAC Motors selected Hefei Guoxuan High-tech instead of Samsung SDI as its partner for battery production. Hefei Guoxuan High-tech recently obtained certification regarding power battery standards from the Ministry of Industry and Information Technology of China, too.

At the same time, CATL, the second-largest battery manufacturer in China behind BYD, is currently producing the same type of batteries in a small scale and Shenzhen Optimum Battery and Tianjin Lishen Battery, another two of the top five in the country, are also producing both ternary and LFP batteries. “It is said that BYD is trying to manufacture ternary batteries these days as well,” said an industry insider, adding, “In addition, some Chinese companies are looking to produce lithium air batteries, which even South Korean companies have yet to produce in quantity.”

A ternary battery using nickel, cobalt and manganese as positive electrode materials can store more energy with a smaller size than an LFP battery. This means a ternary battery requires a higher level of technology for mass production. Up to now, South Korean battery manufacturers such as LG Chem, Samsung SDI and SK Innovation have produced mainly ternary batteries while Chinese companies have concentrated on LFP batteries.

Nowadays, however, Chinese companies are trying to catch up with their South Korean counterparts in the field of ternary battery production and Chinese electric vehicle manufacturers are also increasing the ratio of vehicles equipped with ternary batteries. According to the Gaogong Industry Research Institute (GGII) in China, the local demand for ternary batteries is estimated to increase from 4 GWh to 12.5 GWh between last year and this year and soar to 90 GWh for four years to come.

Under the circumstances, the South Korean companies there are in the face of various regulations imposed by the Chinese government while the Chinese battery suppliers are shoring up their competitiveness. The Ministry of Industry and Information Technology of China is planning to release its fifth list of companies satisfying the power battery standards next month. Not a single South Korean company has succeeded in putting its name on the first to fourth lists in spite of its superior technological strength and it is said that this has to do the Chinese government’s policy to foster local companies.