Battery Race between Korea and China Heating Up

Competition in the electric vehicle (EV) battery market is narrowing to a two-runner race between Korea and China. While Korean battery makers are joining forces with U.S. automakers, Chinese battery companies are also bulking up based on subsidies and tax support from the Chinese government.

The total amount of EV battery usage registered in 80 countries around the world reached 216.2 GWh between January and October 2021, an increase of 116.1 percent from a year earlier, SNE Research said on Dec. 5.

According to the battery usage ranking, CATL came in first with 67.5 GWh (31.2 percent), followed by LG Energy Solution with 45.8 GWh (21.2 percent) and Panasonic with 28.5 GWh (13.2 percent). They were followed by BYD with 18.4 GWh (8.5 percent), SK On with 12.6GWh (5.8 percent), Samsung SDI with 10.0GWh (4.6 percent), CALB with 6.0GWh (2.8 percent), Guoxuan with 4.6GWh (2.1 percent), AESC with 3.2GWh (1.5 percent) and SVOLT with 2.1GWh (1.0 percent).

Chinese companies showed remarkable growth. SVOLT grew 890.2 percent year-on-year, ranking first in terms of growth rates. Chinese companies swept all of the top five growth rate rankings in the order of BYD with 196.2 percent, CATL with 188.0 percent, CALB with 178.2 percent, and with Guoxuan 176.9 percent. In Korea, SK On logged the largest growth rate of 120.2 percent, while LG Energy Solution and Samsung SDI posted 99.4 percent and 63.6 percent, respectively.

On the other hand, most Japanese companies including Panasonic saw their market share fall as their growth rates were below the market average.

Increased sales of vehicles running on batteries from the three Korean companies drove their growth. LG Energy Solutions benefited from strong sales of the Tesla Model Y (made in China), the Volkswagen ID.4, and the Ford Mustang Mach-E. SK On enjoyed battery sales growth thanks to strong sales performances of the Hyundai IONIQ 5, the Kia Niro EV, and the Kia EV6. Samsung SDI’s sales growth resulted from rises in sales of the Fiat 500, the Audi E-Tron EV, and the Jeep Wrangler PHEV. However, a sharp drop in Volkswagen e-Golf sales offset Samsung SDI’s overall sales increase.

Korean battery makers are expanding their market shares in the U.S. LG Energy Solution has partered with GM to set up battery plants in the U.S. In addition to GM, the company has established a battery joint venture company with Stellantis.

SK On plans to establish a joint venture company with Ford to secure an annual production capacity of 150.5GWh in the United States as early as 2026. The company is scheduled to annunce the launch of a battery joint venture in Europe early next year.

Meanwhile, global EV battery usage in October hit 26.2GWh, up 70.0 percent from the same month of the previous year. Despite the COVID-19 incident, the EV battery market continued to grow for 16 consecutive months.