【Spotlight】What are the strategic plans of foreign lithium battery enterprises in China? (II)

2017-02-04  |  By Faye  |  In policy

Capital rushes into Chinese market
With rapid development of Chinese NEV market, giants of foreign lithium battery industry chain aim at Chinese traction battery market in succession to achieve capital expansion. 

1.Mitsubishi Chemical and UBE merged electrolyte business in China 
Mitsubishi Chemical and UBE merged their electrolyte business in China. Meanwhile, the two companies will establish a semi-shareholding joint venture and share patents to develop new products and consolidate production bases. Currently, the two companies each control 10% of the global electrolyte market share and increase sales volume from 7 billion yen to 10 billion yen (about 67.5 to 96.4 million USD).  

Mitsubishi Chemical and UBE’s idea of cooperation is a common practice of many international materials companies as well. Under the background of having respective strengths and advantages, companies involving in the same business cooperated in depth by patents sharing, products development and market strategy coordination to seize market dominance through the introduction of international premium customers. 

2. BASF SE and TODA KOGYO merged cathode material business 
BASF SE and TODA KOGYO merged cathode material business and its sales business of intermediates in the North American market. As a giant in chemical industry, BASP has accumulated the cathode material patented technology through a series of mergers and acquisitions while TODA KOGYO plays a prominent role in lithium battery materials industry, possessing more than 10 years of experience in cathode materials manufacturing. Previously, the two companies have set up a joint venture in Japan, focusing on producing cathode materials and their base products sold on the automotive lithium battery, consumer electronics and energy storage equipment markets.  

BASP can quickly access to the traction battery supply chain system of Panasonic, Samsung and LG through TODA KOGYO’s resources, enabling its cathode materials to mature quickly in the battery manufacturing sector. After the new materials have matured and developed industry trends, BASP and TODA KOGYO will consider to introduce them into emerging markets, including China.

3. Samsung SDI and SG Automotive Group set up a joint venture
On September 7, Samsung SDI, SG Automotive Group and Neusoft Ruichi set up a joint venture in Dalian City, Liaoning Province to produce and sell NEV traction battery pack and charger. Samsung SDI’s primary service is the production and sale of small and traction batteries and other products and the company’s main business is the production and sale of vehicles, automobile axles and parts. The company plans to invest 600 million USD in phases within 5 years and jointly establish the largest vehicle traction battery production base in High-tech zone in Xi’an City with ARN and Xi’an Gaoke Group.  

4. Central Glass and Chemspec jointly established LiPF6 concentrated solution project 
Central Glass, Shanghai Chemspec and Suzhou Chemspec jointly invested 12.5 million USD to establish the Zhejiang Central Glass and Chemspec Co., Ltd. project in High-tech industrial park in Suzhou City, Zhejiang Province. Later, the company founded the Dongying Shengshi Chemical Co., Ltd. with Shandong Shida Shenghua Chemical Group mainly for the LiPF6 concentrated solution project that with an output of 3,000 tons every year. 

Conduct strategic cooperation to explore the Chinese market

1.LG Chem & Changan Motor
LG Chem has signed a strategic cooperation agreement with Changan Motor that it provided traction battery for Changan Motor from the second half of 2010. Additionally, the company has also signed the agreement with Geely’s Volvo. In November 2012, LG Chem signed a letter of intent with Sacred Sun that the two companies intend to cooperate in the field of lithium-ion battery energy storage devices in China's telecommunications market.

2.Panasonic & Beijing Linkdata Technologies
Panasonic and Beijing Linkdata Technologies reached a strategic cooperation to jointly explore business in the field of electric power storage. Reportedly, the two companies will collaborate in developing power for China Mobile telecommunication base station, traction battery system for passenger vehicle, low-speed EV and logistics vehicle as well as a variety of energy storage battery systems and solutions.

A brief summary:
Driven by explosive growth of NEV in China, the country has become the world’s largest lithium battery production areas and consuming market day by day. Foreign enterprises rushed in Chinese market in succession, leading to fiercer competition in the future. Undoubtedly, only when domestic enterprises improve the ability of independent innovation, establish a closer strategic alliance and deepen cooperation, will they be able to remain in an invincible position in the NEV supply chain in the future.  

Article source: VehicleTrend

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