The light vehicle lithium battery industry is booming overseas, beware of bad money driving out good money

In recent years, overseas markets represented by Europe and North America are becoming new incremental markets for domestic power batteries, and the electric vehicles, lithium batteries and photovoltaic industries, known as the "new three things" of foreign trade, have continued to perform strongly. But at the same time, due to the interference of external factors, the trade environment of the "new three things" in overseas markets faces great uncertainty.

At the same time, the domestic light vehicle lithium battery industry, including lithium batteries used in vehicles such as electric bicycles, electric bicycles, electric motorcycles, and electric tricycles, has grown rapidly and maintained a global leading level. It is becoming an important part of the new energy industry's overseas expansion, especially in the "Belt and Road" countries, becoming an important driving force for the electrification of travel, and to a large extent, it also plays the role of "pioneer" in China's new energy vehicle exports.

However, the current situation of China's light vehicle lithium battery industry is "blooming inside the wall and fragrant outside the wall". In China, traditional batteries with backward performance and serious pollution squeeze the lithium battery market space at low prices, and safety accidents caused by inferior batteries also make compliant lithium batteries "take the blame".

In this context, it is necessary to provide policy and market support for the compliant light vehicle lithium battery industry.

The storm is coming: trade protectionism is on the rise again, and the road to new energy going overseas is long and obstructed

In recent years, the export of "new three things" represented by China's new energy vehicles, lithium batteries, and photovoltaic products has achieved remarkable results. The impressive full-year export data in 2023 also proves this point. The total export of "new three things" products exceeded the trillion yuan mark for the first time, reaching 1.06 trillion yuan, a year-on-year increase of 29.9%.

With years of accumulation and development, lithium batteries have become one of my country's important export products with high technology, high added value, and high competitiveness. However, there are both great scenery and turbulent waves on the sea. "The stability of the overseas trade market environment is the most worthy of attention." Cui Dongshu, secretary-general of the China Passenger Car Association, said.

In September this year, the Office of the Trade Representative of the Biden administration of the United States issued a final decision on the imposition of 301 tariffs on China, confirming that import tariffs on Chinese-made electric vehicles, semiconductors, medical products, etc. will be significantly increased. The relevant measures will take effect on September 27. The US side has used tariffs to promote trade protectionism.

On October 4, the Europeanｕｎｉｏｎvoted on whether to impose a five-year countervailing duty on Chinese electric vehicles. A statement released by the European Commission showed that the European Commission's proposal to impose tariffs on Chinese imported pure electric vehicles received the necessary support of EU member states, with a maximum tariff of 45.3%. In the foreseeable future, my country's lithium battery exports may face multiple restrictions.

This requires lithium battery companies to weigh uncertainty and business opportunities and always have insight into the different needs of overseas markets. For light vehicle lithium battery companies that are not very dependent on the European and American markets and are more interested in countries with a large population base, the "Belt and Road" is the most direct choice.

Unique approach: Southeast Asia's light vehicle lithium battery market has great potential

The tide is surging, the waves are high and the fish are expensive. Going overseas is not a smooth journey. Perhaps we can follow the idea of the "Belt and Road" and turn our attention from Europe and the United States to another huge blue ocean market-Southeast Asia. On the road to brand going overseas, light electric vehicles are in the limelight.

Take Malaysia as an example, motorcycles are the most common means of transportation. According to World Bank statistics in 2022, the number of motorcycles in Malaysia is about 10 million, which means that one in every three people in Malaysia owns a motorcycle. Two-wheeled vehicles are more popular in countries such as Indonesia and Thailand, which have complex terrains such as mountains, forests, and islands. At the same time, the process of oil-to-electricity conversion in Southeast Asian countries is also on the way. At the COP26 summit, Southeast Asian countries collectively pledged to eliminate fuel vehicles by 2040, and the capacity of electric two-wheeled vehicles and electric three-wheeled vehicles in the future market will reach 60 million. At present, Indonesia, Thailand, etc. have specially introduced subsidies for electric motorcycle replacement to accelerate the electrification process of the two-wheeled vehicle market in the region with "cash ability".

The huge blue ocean market also attracts many companies. Chinese two-wheeled vehicle manufacturers and two-wheeled vehicle lithium battery leading companies have focused their attention on this, actively carried out overseas layout and built factories locally. The light vehicle lithium battery industry is becoming an important part of China's new energy going overseas, gradually keeping pace with new energy vehicles, and helping China's "Belt and Road" high-quality development.

The journey is long: the electric two-wheeled vehicle lithium battery industry is in the ascendant, don't let bad money drive out good money

To gain recognition from overseas markets, electric two-wheeled vehicle lithium battery companies must first establish themselves in the domestic market and continue to do well and become stronger. In addition to continuously strengthening their own technical strength, the development of an industry also requires policy support and protection.

At present, we need to prevent the "bad money drives out good money" from being staged in the light vehicle lithium battery industry. The frequent safety accidents of inferior lithium batteries have a profound impact on the living environment of compliant lithium batteries. The industry is looking forward to more supervision and punishment of inferior lithium batteries to wash away its own "unjust injustice".

For 20 years, in an environment without subsidies and favorable support, the reason why domestic electric two-wheeled vehicle lithium battery companies have been able to grow from scratch and become an important part of helping the "Belt and Road" new energy to go overseas is that they are always guided by user needs and have won the market. Users have recognized the value of electric two-wheeled vehicle lithium batteries with real money.

At present, the public still has a deep stereotype that electric two-wheeled vehicle lithium batteries are "unsafe". The government, industry and users need to treat electric bicycle lithium batteries objectively and fairly, and cannot deal with them in a one-size-fits-all manner. Inferior lithium batteries should be resolutely banned, and compliant electric bicycle lithium batteries should be strongly supported. We should develop together at home and abroad, jointly help new energy go overseas, and contribute to the country's "Belt and Road" strategy.