The power battery falls into the dark time in the second half of next year or welcomes the full grid revival

category:Finance
 The power battery falls into the dark time in the second half of next year or welcomes the full grid revival


Industry insiders said that the sharp decline of state subsidies led to structural adjustment of the industry is an inevitable result, and it will still be at a low ebb in the short term. However, with the end of a new round of car configuration cycle, the market is expected to see a reversal in the second half of 2020, and the full grid will revive. Among them, the price trend of upstream resources has become an important lifeline affecting the industry, and the key to solve the problem of resource source is to open the channel of battery recovery. It is worth noting that the Ministry of industry and information technology issued the new energy vehicle industry development plan (2021-2035) (Draft for comments) on December 3, which also plans to improve the ability to guarantee key resources and improve battery recovery.

Subsidy industry reshuffle

In 2019, the high subsidy of new energy vehicle industry for many years has officially become the past. In the post subsidy era, the sales volume of new energy vehicles fell to a low point, the power battery industry chain was not spared, and the industry reshuffle process was accelerated.

In late June this year, the subsidy policy for new energy vehicles will be implemented in 2019. As a result, local government subsidies for new energy vehicles have been cancelled, and the national subsidy standard has been reduced by more than 50%. The impact of weaning immediately appeared. The sales volume of new energy vehicles fell for four consecutive months from July to October this year, with year-on-year changes of - 4.7%, - 15.8%, - 34.2% and - 45.6% respectively. The decline is more and more big. According to the analysis of many insiders, the sales volume of domestic new energy vehicles in 2019 will be between 1.15 million and 1.3 million, far below the expectation.

The sharp decline of the environment has become the last straw to crush many battery enterprises. Since this year, battery companies have frequently exploded or went bankrupt, and conducted to the upstream and downstream. For example, the recent bick power is deeply in serial debt, and the former power battery giant watma has entered bankruptcy liquidation procedures. Obviously, the business life is not as good as it used to be. In the interview with the reporter of securities times u00b7 e company, we found a new detail: in the past years, the power battery industry has been booming, and enterprises are keen to actively disclose the product operation data and change range to the outside world. But this year, most companies are avoiding it.

The sharp decline in subsidies has exposed the hidden irregularities in the operation of the industry after years of rapid expansion. Among them, the capital chain and debt problems of enterprises have been paid attention to.

Shantou, an enterprise mainly engaged in aluminum-plastic film products, told reporters that from the perspective of the whole industry, as a material supplier, the upstream raw material procurement is basically based on cash or credit guarantee, but the downstream market promotion is another scene. The account period is longer and longer, and the account is more and more difficult to collect, so the capital pressure and risk are quite large. Unreasonable expansion and disordered vicious competition seriously restrict the healthy development of the industry.

Irrational market behavior will indeed accelerate the reshuffle of the industry, Yang Hongxin, general manager of honeycomb energy, expressed the same view in an interview with a reporter from securities times u00b7 e company. The financial operation of an enterprise is very important, and the choice of customers will have a significant impact. The risk control of supply chain is an important factor to test the quality of operation. From the perspective of industry, due to the fierce domestic competition and the influence of subsidy policies, many uncertain factors and irrational market behaviors will exist, which will lead some enterprises to fall into business risks.

The concentration of non-conforming enterprises has accelerated the clearing of low-end production capacity, and the improvement of industry concentration has become an inevitable result.

Li Pengcheng, vice president of Nord (600110), gave an example to the reporter: the change of customer structure is an intuitive performance. Three years ago, there were more than 50 power battery customers in the company, but now there are more than 10 main customers, among which the top five customers accounted for about 70% of the sales.

On the whole, the industry resources and market share are also moving towards the head enterprises. At the international summit of Chinas new battery energy industry held recently, the Secretary General of Zhongguancun new battery technology innovation alliance, Puritanism, gave a group of data: at present, there are about 80 power battery manufacturing enterprises in China, of which about half are able to realize the installed capacity, and the top ten enterprises occupy more than 80% of the market share. In order to survive, some domestic power battery enterprises began to return to the 3C battery field or turn to the energy storage industry. The listed companies coming from across the border either contracted investment or directly returned to the main business.

2020 ushers in a reversal?

Sales of new energy vehicles have been falling. When will the dark time pass and where is the turning point of the dawn?

According to the reporter, due to the change of subsidy standard, all links of the new energy automobile industry chain have to be calibrated again, which needs a cycle. Therefore, the industry may still be at a low ebb in the short term.

Specifically, due to the adjustment of automobile subsidy standard, the production enterprises also need to follow the trend for the product configuration of automobiles. It is necessary to adjust the vehicles mileage, power consumption, etc. according to the new standard. In order to cope with the reduction of subsidies in the future, enterprises try to absorb and digest the corresponding impact, including possible adjustment of configuration, so that some strategic adjustments can be made in terms of price. At the same time, a new round of negotiation and introduction of battery products needs a certain period, and the period of relevant calibration test certification also needs a long time.

Therefore, in the first half of next year, the market is not expected to have a particularly large growth, which will be relatively difficult. According to Yang Hongxin, general manager of honeycomb energy.

However, with the end of the adjustment cycle, new car product configurations will be launched, and with the continuous decline of battery costs, more competitive models will be launched, stimulating consumers to be more willing to buy new energy vehicles. Yang Hongxin said that the market will improve in the second half of next year, and may resume a relatively good growth momentum.

The factors supporting the reversal of the market include the acceleration of electrification in overseas markets and the production of Teslas China plant.

This year, the overseas automobile manufacturers represented by German series automobile enterprises have accelerated the groups electrification process. At present, the global power battery industry chain is mainly concentrated in three countries, China, Japan and South Korea, while Europe is relatively scarce. Therefore, the domestic leading enterprises are expected to take a share of the new market share.

As a matter of fact, there are already listed companies that are enjoying it. Just in November, BMW announced that it had ordered lithium batteries worth more than 10 billion euros, among which the order with Ningde times, the leader of Chinas power batteries, had increased from 4 billion euros in the middle of last year to 7.3 billion euros, and the contract validity period had been extended from 2020 to 2031. At the same time, another industry giant, BYD, reached an agreement with Toyota to establish a joint venture of pure electric vehicle R & D company, and Audi also confirmed that it was negotiating with BYD on battery cooperation.

It is worth noting that the acceleration of overseas market also provides opportunities for domestic power battery enterprises to go abroad. An important manifestation is that the battery companies with a keen sense of smell have targeted at Europe. As one of the largest new energy consumption markets in the world, it will be an important strategic measure to invest and set up factories in Europe. Among them, in October this year, the first overseas factory of Ningde era in Thuringia, Germany, officially broke ground and started construction, filling the gap of power battery manufacturing in Germany. In addition, the rising star honeycomb energy also plans to establish production lines in Europe.

Secondly, the increase of overseas orders reflects the enterprises going out. Qian Xiaoren, general manager of Suzhou Tianyu, which specializes in lithium battery coil core, told reporters that in the field of power battery, the companys product export plan is very sufficient in recent years, and indeed has established project cooperation with a number of larger customers.

In addition, in addition to the expansion of overseas market cake, the official production of Teslas China plant will play a catfish effect on the domestic battery industry.

Liu xianglie, general manager of rongbai Technology (688005), told the securities times u00b7 e that Teslas production in China will promote healthy competition in the industry. The company expects that Tesla will select new battery companies in China, and upstream raw material companies will also have the opportunity to enter Teslas supply chain. This puts forward higher requirements for raw materials in terms of technical indicators, product performance, price cost, etc., which will also force related companies in the domestic industrial chain to improve their R & D and production capacity.

At the same time, Teslas entry will also improve the domestic markets consumption expectation for electric vehicles. Industry insiders said that changes in the supply side will greatly affect the psychology of consumers. At this stage, many factors are psychological expectations that determine whether consumers buy new energy vehicles or not. But after the whole cake becomes bigger, it will change the psychology of consumers, thus promoting the vitality of the whole market.

Upstream resources become the lifeblood of the industry

With the decline of new energy vehicles, the importance of upstream resource price trend for the battery industry chain has become increasingly apparent. Yesterdays new energy vehicle industry development plan (2021-2035) (Draft for comments) mentioned that we should promote the development of the full value chain of power batteries, and encourage qualified enterprises to improve the ability to guarantee key resources such as lithium, nickel, cobalt and platinum.

In recent years, due to unreasonable planning and disordered expansion of production capacity, many resource varieties frequently staged roller coaster market. Whether soaring or falling, it increases the uncertainty of the industry.

Among them, the production capacity of the companies producing battery grade cobalt sulfate, lithium carbonate and lithium hydroxide increased significantly in 2019, and the supply exceeded the demand, so the price of cobalt and lithium was close to a cut compared with the high level in 2018.

After the big drop, has the price of cobalt and lithium reached the bottom? The expectation of rebound is indeed rising, but many companies in the industry interviewed by the reporter are still cautious about the short-term trend.

Yang Hongxin, general manager of honeycomb energy, said the price of lithium would fall in the short term because its supply is indeed increasing. From the perspective of global demand and supply, it can meet the requirements of lithium-ion battery, and its upstream cost is also declining.

For cobalt, the source of raw materials and the choice of battery technology route are two major factors.

Low cobalt or non cobalt technology path is the direction that many vehicle manufacturers and battery enterprises are pursuing at present. As a result, demand expectations for cobalt are actually under pressure. In the face of this situation, suppliers of upstream raw materials will be more careful to assess the risk of cobalt hoarding. A battery manufacturer told reporters that there is a great opportunity and space for cobalt free materials. If the price of cobalt is too high, the use of cobalt free materials can reduce costs. Therefore, the company is not particularly concerned about the price of cobalt. There are indeed technical means to solve the problem of cobalt.

At the same time, due to the centralized distribution and wide use of cobalt resources, in recent years, some countries have encountered social problems such as environmental protection in the process of mining. Therefore, some overseas car companies are more and more cautious in the face of material sources, and they are demanding to improve the transparency of procurement. For example, not long ago, BMW just announced that it would restructure its supply chain, plan to directly purchase cobalt and lithium raw materials, refuse to use materials from illegal sources, and ensure the legitimacy of the sources.

Industry insiders believe that due to the relationship between production and supply, the approximate rate of cobalt price will continue to decline in the short term, and there is still room for the price to decline, because the whole supply-demand relationship meets the requirements. But by the end of next year or after 2021, there will be turning points. If the current mining volume and production volume are maintained, with the increase of vehicle sales and the large-scale application of ternary materials, in 2022, there will be a significant shortage of cobalt, and then the price will enter the fast upward channel.

In 2020, according to the response of many industrial chain enterprises, a variety needs to be focused on, that is, nickel.

Nickel is a matter of uncertainty next year, because the high nickel route favored by the industry has led to a substantial increase in demand for nickel. Previously, the production of low-cost laterite nickel ore in Indonesia is very large, but Indonesia recently announced that it will stop the export of laterite nickel next year, which will bring some uncertainty to the market. Yang Hongxin said.

Liu xianglie, general manager of rongbai technology, holds the same view. He told the securities times u00b7 e company that the main application scenario of nickel metal is still in the stainless steel industry, and the impact of the battery industry on nickel price is relatively limited. However, due to the impact of Indonesias policy of banning raw ore export, the price of nickel may rise next year.

In addition to the price changes of upstream resources, the price of power batteries and related materials also faces certain price pressure.

In terms of cathode materials, they account for a large proportion of the cost of power batteries, accounting for about 30%. Liu said that the price of cathode materials is expected to be relatively stable next year, but the price pressure from battery manufacturers will increase.

From the perspective of copper foil, as an irreplaceable basic material for lithium battery, the domestic market share of lithium battery copper foil provided by Nord Co., Ltd. exceeds 30%. Li Pengcheng, vice president of the company, said that although there are signs of capacity expansion in the copper foil industry at present, the release of capacity and the formation of effective supply is a slow process. Next year, the price of copper foil will not fluctuate too much.

For the overall price of power battery, with the decline of subsidies, the battery output of international manufacturers increases, and the price pressure of vehicle manufacturers on battery manufacturers also increases, and the battery price is expected to decline.

Get through the battery recycling channel as soon as possible

For the battery industry, upstream resources have become a must for strategists. With the rapid growth of new energy vehicle sales, it is urgent to open the battery recycling channel, which will become an important source of upstream resources. In the newly disclosed industrial development plan, the Ministry of industry and information technology also mentioned the need to improve the recycling system of power battery recycling, cascade utilization and recycling, and encourage joint construction and sharing of recycling channels.

2019 Nobel Prize in chemistry, in the field of lithium-ion batteries. After receiving the award, Akira Yoshino, a Japanese expert, called for recycling batteries to be the key to ensuring that enough raw materials are available to drive the surge in demand for electric vehicles. He said that if recycling can be promoted on a large scale, it will highlight the economic effect.

Yoshinos appeal comes at the right time for China, which is on the eve of the wave of retirement of electric vehicles.

China Merchants Securities data shows that the peak period of power battery retirement will come. Chinas new energy vehicles have entered the stage of explosive growth since 2014. According to the calculation of the service life of power batteries for 4 to 6 years, the annual production of power batteries in 2014 began to enter the period of scrapping in batches last year. It is estimated that by 2020, China will produce about 240000 tons of retired lithium-ion batteries, and in 2022, 530000 tons of retired lithium-ion batteries.

However, at present, some large vehicle manufacturers and battery manufacturers have not yet expanded their battery recovery business on a large scale. Why?

It is understood that this is related to the main type of retired batteries. It is estimated that the main body of retired batteries is lithium iron phosphate, but the recovery value of the main body is relatively low. However, the three-way power battery with high recovery value still accounts for a small proportion of the potential retired batteries.

Many large enterprises are reluctant to do (battery recycling) because there are not so many recyclable ternary batteries in the market. There is not much recyclable in lithium iron phosphate, and more than 90% of nickel cobalt manganese ternary batteries are recyclable and reused, but the amount of ternary batteries is still small. Yang Hongxin said. However, with the wide use of three-way battery in recent two years, it is expected that from 2023, three-way power battery will surpass lithium iron phosphate battery and become the main object of recycling. It has become the common aspiration of the industry to get through the overall channel of recycling as soon as possible. As the leader of ternary positive materials, rongbai technology has plans to arrange recycling business in China. Liu xianglie, general manager of the company, called for the establishment of the ecological chain of domestic recycling industry as soon as possible. First, it is for resource reuse, and second, it is to consider environmental issues, so the battery can no longer be scrapped. However, to do a good job in this industrial chain, from the government level, the relevant standards and policies must be clear in order to accelerate the formation of the industrial chain. Source: responsible editor of Securities Times: Yang bin_nf4368

Many large enterprises are reluctant to do (battery recycling) because there are not so many recyclable ternary batteries in the market. There is not much recyclable in lithium iron phosphate, and more than 90% of nickel cobalt manganese ternary batteries are recyclable and reused, but the amount of ternary batteries is still small. Yang Hongxin said.

However, with the wide use of three-way battery in recent two years, it is expected that from 2023, three-way power battery will surpass lithium iron phosphate battery and become the main object of recycling. It has become the common aspiration of the industry to get through the overall channel of recycling as soon as possible.

As the leader of ternary positive materials, rongbai technology has plans to arrange recycling business in China. Liu xianglie, general manager of the company, called for the establishment of the ecological chain of domestic recycling industry as soon as possible. First, it is for resource reuse, and second, it is to consider environmental issues, so the battery can no longer be scrapped. However, to do a good job in this industrial chain, from the government level, the relevant standards and policies must be clear in order to accelerate the formation of the industrial chain.