my country's power battery production capacity expansion cycle has ended and will enter a contraction cycle

On March 4, the Ministry of Industry and Information Technology released the operation status of the national lithium-ion battery industry in 2023. Overall, although the production of power lithium batteries still maintained growth year-on-year, the growth rate plummeted by 84%. This shows that my country’s power battery production capacity expansion cycle has ended and will enter a contraction cycle in 2024.

In 2023, the country's total lithium battery output will exceed 940GWh, a year-on-year increase of 25%, and the industry's total output value will exceed 1.4 trillion yuan.

Among them, the output of power lithium batteries is 675GWh, a year-on-year increase of 23.65% compared with 2022 (545.9GWh). However, compared with 2022, the output of power lithium batteries will increase by 148.5% year-on-year in 2021, and the growth rate will plummet by 84%.

In addition, product prices in the lithium battery industry have dropped significantly throughout the year, with battery cell and battery-grade lithium salt prices falling by more than 50% and 70% respectively from January to December.

According to data from the China Automotive Power Battery Industry Innovation Alliance, between January and December 2023, the cumulative installed capacity of power batteries in my country was 387.7GWh.

These data show that the current overcapacity problem in my country's power battery industry is prominent.

In addition, the two leading companies CATL and BYD occupy more than 70% of the market share, and the differentiation of power battery companies has intensified.