Demand of European battery enterprises releases, China's lithium battery industry chain benefits

European electrification has accelerated, China’s lithium battery supply chain has accelerated to go overseas. Recently, the French ACC, a local power battery enterprise in Europe, issued a number of purchase orders for lithium battery raw materials and lithium battery equipment, and many Chinese lithium battery enterprises won the huge orders. ACC was found in June, 2020, mainly engaged in the development and production of electric vehicle battery cells and modules. Automaker Stellantis, Mercedes-Benz and Energy company TotalEnergies each hold one-third of its shares. It is reported that ACC plans to build three plants with a capacity of 40GWh in Germany, French and Italy respectively. By 2030, the total production capacity of its power batteries will reach 120GWh. This time, a number of purchase orders for lithium battery raw materials and equipment were issued, indicating that the power battery factory built by ACC in Europe is accelerating the landing, and it is expected that more purchase orders for raw materials and equipment will be issued later.

On May 4, Yunan Energy announced that its subsidiary SEMCORP Hungary Kft signed a contract with ACC to supply ACC with lithium battery separators of about 655 million euros (about 4.56 billion yuan) between 2024 and 2030. Umicore also said that it had received orders from ACC, and its plant in Nisa, Poland would supply ACC with next-generation high-nickel cathode materials. The supply will meet the production needs of at least 46GWh lithium batteries by 2030. In addition, lithium battery equipment enterprises Lead Intelligent and Yinghe Technology also received huge equipment purchase orders from ACC. In 2020, Yinghe Technology announced that it had obtained the entire line order from ACC. Recently, Yinghe Technology announced that it has obtained another order for ACC lithium battery equipment, which will meet the demand for mass production equipment in the early stage of its French battery factory with a capacity of 13GWh. Lead Intelligent also announced that it has signed a strategic cooperation agreement with ACC to provide lithium battery equipment and solutions for its 14GWh battery factory.

It is worth noting that, in addition to ACC, other local European battery enterprises, including Northvolt in Sweden, ACC in France, Verkor in France, Britishvolt in UK, Freyr in Norway, Morrow in Norway, Italvolt in Italy, ElevenEs in Serbia, are also accelerating the construction of their European power battery projects, which will release a huge demand for lithium battery raw materials and equipment procurement.

At present, Europe is accelerating the construction of local power battery production capacity, while the weak local supply chain has become the biggest constraint to the local production and supply of European power batteries. Under this circumstance, a group of Chinese Lithium Battery Enterprises with the strength of “go global” have obtained good development opportunities. At present, Chinese Lithium Battery enterprises, including Tinci, Capchem, Jiangsu Guotai, Shida Shenghua, Easpring, CNGR, SENIOR, KDL and so on, have announced that they will build factories in Europe to provide close supporting services for their customers and enhance their competitiveness in the international market. The above-mentioned lithium battery material enterprises are expected to enter the local supply chain of European power battery enterprises and become an important part of the construction of the European power battery local supply chain.

In addition, leading equipment enterprises, including Lyric Robot, HYMSON, Lead Intelligent, KATOP, and UNITTED WINNERS, have also entered the supply chain of international car enterprises/power battery giants. At the same time, Chinese and Korean battery enterprises, including CATL, Farasis Energy, Envision AESC, SVOLT, LG New Energy, Samsung SDI, and SK On, are also accelerating the pace of building factories in Europe. The above-mentioned battery enterprises will also require their Chinese suppliers to provide localization service for their European projects, so as to broaden the opportunities for Chinese lithium battery enterprises to participate in global market competition.

Source: GGII