South Korean battery companies are “bad friends” because of Tesla, what is the future

The change in the number of power battery companies reflects that the power battery industry is undergoing a change. In the future, can LG Chem secure the champion of power battery installed capacity?

According to the latest data from SNE Research, a global battery industry research organization, the global installed capacity of power batteries in the first quarter of 2020 totaled 20.4GWh, a year-on-year decrease of 14.2%; among them, LG Chem jumped to the first place with a market share of 27.1%, compared with last year It surged 117.1% over the same period.

In addition, the installed capacity of foreign power battery manufacturers such as Samsung SDI and Panasonic has increased significantly. Among them, Panasonic’s market share increased from 22.9% in the same period last year to 25.7%; Samsung’s SDI market share increased from 3.8% in the same period last year to 6%, ranking fourth; and affected by the domestic epidemic in China, Ningde Times Market The market share dropped to third, while BYD’s market share fell from third to sixth.

Cui Dongshu, secretary general of the Passenger Federation, believes that the decline in installed capacity of CATL and BYD is related to factors such as the delay in the resumption of work by domestic car companies and the suppression of consumer demand for car purchases due to the impact of the epidemic. At the same time, the global power battery industry pattern is changing. It reflects the intensified competition in the power battery market.

Tesla is like a “limit-up board”

Yu Qingjiao, secretary-general of the Zhongguancun New Battery Technology Innovation Alliance, likened Tesla to the “upper limit” of the stock market, allowing large and small companies at home and abroad to catch up.

Wu Yihuan (transliteration), chief researcher of SNE Research, analyzed in an interview with the first financial reporter that the current share of foreign power battery companies has increased, and the biggest driving force is Tesla. The global luxury car market, such as the BMW 330e equipped with Samsung SDI batteries, was less affected during the epidemic, which also provided a development opportunity for Korean power battery companies with a wide range of customer companies.

As a car company, Tesla has long been highly bound to Panasonic, and has taken the lead in terms of energy density and energy specific energy. In the Model 3 in 2017, Tesla used Panasonic 21700 cells, and the energy density ratio of a single cell can be increased from 250Wh/Kg to close to 300Wh/Kg.

Tesla has long adhered to the ternary lithium cylindrical battery (NCA) composed of nickel-cobalt-aluminum in terms of batteries. This process is somewhat different from the ternary lithium (NCM) process composed of nickel-cobalt-manganese used by mainstream battery companies in my country. As a result, barriers to entry have been formed for domestic power battery companies. Jin Chaoji (pseudonym), a researcher who used to work in a Korean power battery company, believes that there is another reason why it is difficult for Chinese power battery companies to develop NCA batteries, which is based on the industrial chain problem of how to obtain high-quality, high-purity aluminum. Enterprises, either used to be Electronic components companies (such as Panasonic, Samsung SDI), aluminum is one of the necessities of electronic components production, and it has a highly mature electronic component supply chain, or it is a chemical company (such as LG Chem, etc.), which has its own Conditions for refining high-purity metals.

However, Wang Fan, an insider in the power battery industry, told the First Financial Reporter that although aluminum can enhance the stability of materials in NCA batteries, it is not easy to precipitate, and most domestic battery companies invest their main research and development efforts in NCM. High nickel battery. LG Chem, which has set up factories in China, has already laid out its layout on NCM ternary lithium batteries.

For Panasonic, Tesla as a customer is too important in terms of potential value and actual order value. However, Tesla, which began to be made in China this year, no longer has a soft spot for Panasonic, and successively threw the hydrangea to LG Chem and CATL.

Korean battery companies are “bad friends” because of Tesla

He Yikun (pseudonym), a former executive of LG Chem and executive director of the strategy department, revealed to the First Financial Reporter that for LG Chem and even the entire LG Group, winning orders from Tesla is a “hard battle” that has to be fought.

He Yikun revealed that LG Chem and Tesla officially signed a supply contract in August 2019, but the first Tesla department within LG Group was established in 2016.

Since Tesla’s production has entered a normal track, Panasonic’s production capacity investment has been too slow, and it will soon be difficult to meet Tesla’s needs. Tesla founder Musk has publicly criticized the poor communication with Panasonic on social networking sites. Subsequently, LG Chem, who came prepared, seized the opportunity.

“However, when we knocked on Tesla’s door, in addition to us, there was a power battery giant that competed fiercely with us, and also had certain advantages in terms of price and technology. At that time, we mainly made advanced investments. He Yikun recalled that although LG Chem gave a special amount of English and Chinese to Tesla’s Shanghai factory, a certain percentage of engineers who can speak English and Chinese can be stationed in Tesla’s Shanghai factory. Sla’s price also has a certain discount for large customers, but it is not the lowest compared to what Panasonic and other competitors offer.

Although LG Chem is now a leader in the global power battery industry, its previous competitive disadvantage compared to South Korean power battery giants such as Samsung SDI and SK Innovation (hereinafter referred to as “SKI”) is financial power. LG Chem once had a bad relationship with the “rising star” SKI due to talent competition. It is reported in the Korean power battery industry that SKI and LG Chem chose a similar technical route and poached many of the latter’s technical personnel with high salaries. Since then, the two sides have competed many times in the order confrontation between Tesla and Volkswagen, which eventually led to the two The relationship between them quickly turned cold, even at the cost of going to court in the United States.

For the above rumors, the staff of the two companies were noncommittal.

future geometry?

In recent years, the investment scale of Korean battery companies represented by LG Chem and SKI in the global market including China has continued to increase, and there has been a certain phenomenon of advanced investment. According to a statistical report by a South Korean securities company, in the next three years, South Korean power battery companies will continue to invest nearly 10 trillion won in global production capacity, of which nearly 40% will be invested in the Chinese market.

A staff member of LG Chem who requested anonymity said that although Tesla helped LG Chem make great contributions in capturing the market, and even endorsed the company’s external image, the company still has some problems: how small is it? It is impossible to rely on Tesla alone to make money immediately and to expand the company’s strategy in the future.

In addition, according to SNE Research, from 2020 to 2026, the global power battery market will grow at an average compound growth rate of 16% per year, and the pace of “self-produced batteries” by major car companies in order to master the industry chain is also accelerating.

At present, the relationship between OEMs and power battery manufacturers is complicated. Some OEMs are preparing to start their own battery production through acquisitions. For example, Volkswagen has recently been rumored to acquire shares in Guoxuan Hi-Tech and plans to invest 450 million euros to build a lithium battery factory. The initial capacity is 16GWh.

In addition, cross-border cooperation within Korean companies is also advancing; some OEMs are getting closer to power battery manufacturers. On May 13, Samsung Group’s actual controller Lee Jae-yong and Hyundai Motor Group’s chief vice chairman Zheng Yixuan Meet and learn about Samsung SDI’s research and development progress in power batteries, and this is the first time in the history of Hyundai’s executives to visit Samsung’s production line.

According to people familiar with the matter, Hyundai Motor executives visited Samsung mainly based on the latest research and development progress of all-solid-state power batteries with a cruising range of 800km released by Samsung’s R&D department. In-depth discussions were held on the establishment of a research and development joint venture specializing in the development of all-solid-state batteries.

The above-mentioned person familiar with the matter also said that the cooperation plan between the two is still in the process of discussion, but it is certain that if the two establish a joint venture, it is likely to completely change the mode of cooperation between vehicle companies and battery companies. Will be dedicated to pure research and development.

Li Xianye, an analyst at Shinhan Securities in South Korea, said that Hyundai Motor can not only increase the battery supply line, but also set up a R&D exclusive company model, without breaking the original supply chain and design model, and Samsung SDI can also obtain a market for continued research. power.

On the one hand, competitors such as Samsung SDI and SKI are accelerating their competition in the field of power batteries. On the other hand, Tesla’s orders may not be “indestructible”. Following the cooperation with LG Chem, Tesla also joined hands with China’s local battery supplier CATL. According to a Reuters report, Tesla will work with CATL to develop long-life batteries based on single crystal technology, and is developing lithium iron phosphate LFP batteries, which will reduce Tesla’s battery cost to $100 in 2021 /KWh.

In addition, Tesla has announced that it has signed a procurement contract with South Korea’s Hanwha Group, and will soon sign an order for the supply of battery-forming equipment. An agreement has been reached on the supply of equipment, which is regarded by the industry as Tesla’s layout for self-produced batteries.

In addition, LG Chem has planned a total production capacity of 35GWh in two Nanjing factories, which is also the largest planned production capacity in the world and is enough to supply batteries for 1.6 million electric vehicles. In addition to holding hands with Tesla, LG Chem has recently been bound by joint ventures and cooperation with GM, Geely and other car companies.

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