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Explosive growth in NEV sales causes short supply of batteries

Source: China Business Daily | Date: Dec. 10

  • Statistics from the CPCA (China Passenger Car Association) show that China's new-energy vehicle (NEV) sales grew by 240% year on year to 24, 664 units in Nov. Amid the explosive growth in NEV sales, mainstream NEV manufacturers, such as BAIC New Energy Vehicle Co., SAIC Motor Passenger Vehicle Co., and JAC, are facing a short production capacity of NEVs. This is largely due to the short supply of power batteries.

  • In the face of the current market situation, domestic power battery manufacturers are stepping up production expansion. Tianneng Power recently announced its plan to add at least four new production lines next year to expand its total production capacity to 1GW. As such, the company will supply power batteries for 150,000-200,000 electric vehicles. Guoxuan High-Tech has also announced that its new production line, with a production capacity of 240 million AH, will begin operations next year.

  • This signals that the power battery sector will see explosive growth in output next year. One insider warns that excessive production capacity expansion may lead to production surplus so that some small manufacturers will face a predicament in business operations.