Power batteries showed growth momentum in July

In July 2024, China's power battery market showed significant growth momentum and structural adjustment. When battery prices remained at a low level, market demand remained relatively active.

Track key data such as battery production, sales, exports and installations in July to gain insight into the latest developments in the new energy vehicle industry and the complex changes in the battery industry.

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In July 2024, China's total production of power batteries and other batteries reached 91.8GWh, up 8.6% from the previous month and 33.1% from the previous year. The cumulative output from the beginning of the year to date is 521.8GWh, up 36.2% from the previous year. The growth was mainly driven by the surge in demand in the new energy vehicle market, driven by policy support and technological progress in new energy vehicles.

In July, total battery sales were 86.3GWh, down 6.4% from the previous month and up 49.9% from the previous year. Sales of power batteries were 62.2GWh, down 10.3% from the previous month and up 19.0% from the previous year. The proportion of power batteries in total sales has dropped to 72.1%, down 3.1 percentage points from the previous month.

In comparison, sales of other batteries showed extremely strong growth, with sales in July reaching 24.1GWh, a month-on-month increase of 5.3% and a year-on-year increase of 351.9%.

This shows that in addition to traditional power batteries, market demand for other battery types is also increasing rapidly, especially the growth of applications in energy storage and consumer electronics.

In July, China's total battery exports were 15.6GWh, a decrease of 15.5% month-on-month and an increase of 28.9% year-on-year.

● The export volume of power batteries was 9.6GWh, down 27.2% from the previous month and 13.1% from the previous year. The export of power batteries accounted for 61.5% of the total export volume, but its proportion decreased by 10.0 percentage points compared with the previous month. As the development of pure electric vehicles in Europe and the United States has stagnated, the international market demand for Chinese power batteries may be undergoing adjustments, especially at the current sensitive stage.

● In contrast, the export volume of other batteries increased significantly, reaching 6.0GWh in July, a month-on-month increase of 13.9% and a year-on-year increase of 471.6%. As the route of energy storage is determined, there is a demand for Chinese batteries in the fields of renewable energy and energy storage systems.

In July, China's installed capacity of power batteries was 41.6GWh, a decrease of 2.9% month-on-month and an increase of 29.0% year-on-year.

● The installed capacity of ternary batteries was 11.4GWh, accounting for 27.3% of the total installed capacity, a month-on-month increase of 2.3% and a year-on-year increase of 7.5%.

● The installed capacity of lithium iron phosphate batteries was 30.1GWh, accounting for 72.5% of the total installed capacity, a decrease of 4.8% month-on-month and an increase of 39.2% year-on-year. Lithium iron phosphate batteries occupy a dominant position in the market.

Zhineng Comment: Based on these data, we can see that the battery industry will now enter a very brutal elimination round. The overall customer demand is to gradually shift from high growth to low growth. In particular, it is difficult for vehicle manufacturers to make money from pure electric products, and they are all switching to plug-in/extended-range tracks. Even if the scale of new energy vehicles continues to grow, this is very important for the battery situation.

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● From January to July, the cumulative output of power and other batteries was 521.8GWh, a year-on-year increase of 36.2%.

● From January to July, the cumulative sales volume of power and other batteries was 488.9GWh, a year-on-year increase of 41.9%.

◎ The cumulative sales volume of power batteries was 380.3GWh, a year-on-year increase of 25.3%, accounting for 77.8% of the total cumulative sales volume, a decrease of 1.2 percentage points compared with the same period last year;

◎ The cumulative sales volume of other batteries was 108.6GWh, a year-on-year increase of 165.3%, accounting for 22.2% of the total cumulative sales volume.

● From January to July, the cumulative exports of power and other batteries reached 89.2GWh, a year-on-year increase of 28.9%. The total cumulative exports accounted for 18.3% of the cumulative sales in the first seven months.

◎ The cumulative export volume of power batteries was 69.6GWh, a year-on-year increase of 5.2%, accounting for 78.0% of the total cumulative export volume. Compared with the cumulative volume of the previous month, the proportion of power batteries decreased by 3.5 percentage points;

◎ The cumulative export volume of other batteries was 19.6GWh, a year-on-year increase of 153.7%, accounting for 22.0% of the total cumulative export volume.

● From the cumulative data, from January to July 2024, the cumulative installed capacity of China's power batteries was 244.9GWh, a year-on-year increase of 32.8%.

◎ The cumulative installed capacity of ternary batteries and lithium iron phosphate batteries is 73.6GWh and 171.1GWh respectively. The market share of ternary batteries is about 30.1%, and the market share of lithium iron phosphate batteries is 69.9%.

Zhineng Comment: Today's battery companies need to find other areas to offset the lack of momentum in the growth of power batteries. Demand is the first priority, and only by finding certain demand can we further improve capacity utilization.

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