Costly idea of replacing Chinese EV batteries

As the United States government continues to escalate its export controls on China, some car companies of the Republic of Korea that are dependent on Chinese battery materials are having a hard time. To this end, these companies have made submissions calling on the Joe Biden administration to relax its restrictions to allow them to purchase key battery materials from China. Tesla has also encountered similar problems. Due to the deadlock in battery production for its new Cybertruck, the US company had to turn to Chinese manufacturers for battery component support.

It is obvious that China plays an important role in the development of new energy vehicles. As China's new energy vehicle production and sales account for more than 60 percent of the world's total, it has ranked first in the world for nine consecutive years. In 2023, China's exports of power batteries hit 127.4 gigawatt hours, a year-on-year increase of 87.1 percent. The market size of China's power batteries has ranked among the top of the world for seven consecutive years. Among the top 10 power battery companies in the world in terms of vehicle installation volume, six are Chinese.

There is no doubt that China's power battery industry has multiple competitive advantages that are difficult to replace. The country has achieved independent production of almost all key raw materials of power battery production, such as cathode materials, anode materials, and electrolytes, forming complete power battery industry and supply chains.