Panasonic/Samsung/LG 2018 expansion plan, how will domestic batteries respond?

　　After the Spring Festival, the popularity of the new energy industry has soared rapidly. Domestically, a number of policies such as power battery recycling have been released, and the documentary of CATL has been popular. Meanwhile, Japanese and Korean battery companies, unwilling to be left out, have begun to take action. Samsung and LG have successively announced trillion-won expansion plans. Panasonic has expanded production in China, the United States and Japan. In addition, news from BAIC Motor revealed that it is seeking to expand cooperation with Panasonic on new energy and batteries . Let's learn about the relevant content with the power management editor below.    

　　Panasonic: Opening up new areas and deepening cooperation with BAIC

　　On March 3, BAIC Chairman Xu Heyi said that BAIC is seeking to expand cooperation with Japanese companies such as Panasonic on new energy and batteries. BAIC may make a profit by selling its own brands in 2019 and will significantly reduce losses this year.

　　Although the news is short, it contains a huge amount of information. BAIC New Energy sold 103,199 vehicles in 2017, ranking first in China and second in the world. The cooperation between BAIC and Panasonic has been going on for a long time. After withdrawing from the TV LCD panel production business in Japan, Panasonic strengthened its business in power batteries and auto parts. In 2016, BAIC and Panasonic established a joint venture to produce electric compressors, the main components of electric vehicle air conditioners. In the news of the joint venture in 2016, it was stated that the two sides will deepen cooperation in batteries and intelligence in the future, but "the content is still under negotiation and it is not convenient to disclose to the outside world at present."

　　BAIC's main battery supporting companies in China are Guoxuan High-tech and Farasis Energy. At the end of 2017, the "Five-Year Strategic Procurement Framework Agreement for 1 Million Battery Packs" between BAIC and Farasis Energy became the largest order in the industry's history.

　　Panasonic will reportedly increase production in Japan, China, and the United States, where it has lithium-ion battery production bases for pure electric vehicles. Panasonic's Dalian plant is scheduled to start production by the end of March 2018, and Panasonic has already started construction of a second plant. The investment is estimated to be tens of billions of yen, and production will start as early as 2018. If the second plant is completed, the overall production capacity is expected to double.

　　The second phase of the large-scale factory in Nevada, USA, which is being jointly built by Panasonic and Tesla, has begun construction. It is said that once the second phase of the project is completed, the maximum production capacity can reach about 1.5 times the current level.

　　Panasonic will celebrate its 100th anniversary in 2018 and officially become a century-old brand. In the field of power batteries, Panasonic has become an industry benchmark by cooperating with Tesla and Volkswagen. However, Panasonic is not close to Volkswagen and Tesla. Volkswagen is committed to reshaping its leading position in the electric field and has widely issued "hero invitations" on the MEB platform. Chinese and Korean battery giants are eyeing it. Tesla's spokesperson also issued a statement saying that all major battery manufacturers in the world are partners of the company, but it is inconvenient to disclose which suppliers they are.

　　Faced with the pressure from Korean companies and the rise of Chinese companies, what is the way out for Panasonic?

　　Obviously China.

　　Panasonic President Kazuhiro Tsuga said in an interview with the media this year that batteries for Tesla may be produced in China.

　　So, will BAIC launch a more affordable electric car using the same battery as Tesla?

　　Samsung SDI, LG Chem: Crazy expansion of production

　　Research firm B3 estimates that demand for small batteries will increase by 13% to 7.2 billion units this year, driven by demand for power tools, electric vehicles, and smartphones, among which small cylindrical batteries will be particularly popular.

　　According to BusinessKorea, Samsung SDI has started to expand its small rechargeable battery factory in Cheonan, South Korea, with an estimated investment of 200-300 billion won (about 180-270 million U.S. dollars). The main purpose is to increase production of cylindrical batteries, which are in great demand recently.

　　The 21700 battery is used in Tesla Model 3 and has attracted attention in the industry. Influenced by Tesla Model 3 orders, 21700 battery orders have begun to surge, and Samsung SDI and LG Chem have planned to increase production.

　　Due to some issues with Panasonic’s battery supply, the Model 3 mass production target has been repeatedly lowered, so Tesla’s secret meeting with LG and Samsung is very obvious, and the intention to replace Panasonic is very obvious. Korean media reported that Samsung SDI plans to change the old 18650 battery production line to the new 217000 battery production line.

　　According to industry estimates, including the investment in medium-sized batteries, Samsung SDI will invest 1 trillion won to expand battery production, and LG Chem will invest 1.5 trillion won in expansion, with plans to increase production capacity to 70GWh by 2020.

　　How do Chinese companies respond?

　　With the decline of China's new energy subsidies and the implementation of the double-credit policy, sales have become the focus of attention for automakers. Batteries remain the key to maintaining core advantages.

　　Limited by technology, experience and other factors, China's power battery industry started late. With the support of new energy policies and a large amount of capital pouring in, the power battery industry has also ushered in a new era. However, the help of capital has promoted the prosperity of the industry on the one hand, but it has also brought bubbles on the other hand. The low-end production capacity is in excess, and the high-end is insufficient. The industry reshuffle is accelerating.

　　The new energy subsidy policy in 2018 was repeatedly delayed, and finally a four-month buffer period was reserved. On the one hand, it was a rectification of the industry's development, and on the other hand, it was also a concession to the sales target for the development of new energy vehicles.

　　The subsidy policy has won time for Chinese battery companies to develop, but only after going through wind and rain can they truly grow into towering trees.

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