In 2023, the Chinese new energy vehicle industry delivered impressive results under the combined influence of policies and the market. According to data from the China Association of Automobile Manufacturers (CAAM), in the entire year of 2023, the production and sales of new energy vehicles reached 9.587 million and 9.495 million units, respectively, representing year-on-year growth of 35.8% and 37.9%. The market share reached 31.6%, an increase of 5.9 percentage points from the same period the previous year. Among them, the production and sales of new energy passenger vehicles accounted for a higher proportion of total passenger vehicle production and sales, reaching 34.9% and 34.7%, respectively.
The high growth in the automotive market has led to a continued surge in power battery installations. According to data from the China Automotive Power Battery Industry Innovation Alliance (referred to as the "Battery Alliance"), in December 2023, China's power battery installations reached 47.9GWh, a year-on-year increase of 32.6% and a month-on-month increase of 6.8%. The cumulative installation for the entire year of 2023 reached 387.7GWh, with a cumulative year-on-year growth of 31.6%.
In this market context, capacity expansion remains the main theme for the power battery industry in 2023. According to incomplete statistics, Chinese power battery companies initiated a total of 56 new projects domestically and internationally in 2023, with a total investment of over CNY 545.518 billion, planning power battery capacity exceeding 1361GWh.
Looking at the entire year of 2023, there were a total of 44 new power battery projects in China, with a total planned capacity exceeding 936.3GWh. Among them, companies like EVE Energy and Ganfeng Lithium were the most active in expanding their production capacity, with each having six new projects.
In the first half of 2023, EVE Energy initiated multiple power battery projects, including a 23GWh cylindrical lithium iron phosphate energy storage power battery project in Qujing, Yunnan, a 60GWh power energy storage battery production line in Jingmen, Hubei, and energy storage and power battery projects in Shenyang, Liaoning, and Chengdu, Sichuan. In addition, EVE Energy also signed agreements with Jianyang, Sichuan, and Nanchang, Jiangxi, in January and October of the same year, planning to build production bases in these regions.
Ganfeng Lithium also had several new projects in 2023, mostly focused on signing agreements, with actual construction starting only for the 20GWh new energy lithium battery production and research project in Xiangyang, Hubei, and the 20GWh battery production project in Hohhot, Inner Mongolia.
BYD accelerated its battery capacity expansion in 2023. Its Wenzhou power battery production base and Yichun Fredi power battery project started construction in January and February, respectively. In addition, BYD and Weichai Power, a subsidiary of Shandong Heavy Industry, jointly invested in and built a new energy power industry park in Yantai, Shandong, and a sodium battery project in Xuzhou, Jiangsu.
Furthermore, CATL, Contemporary Amperex Technology Co. Limited, EVE Energy, Rui Pularjun, Funeng Technology, and Lishen Battery, among others, all had new projects signed, initiated, or put into production in 2023.
It is noteworthy that in addition to investing heavily in new projects domestically, power battery companies in 2023 also actively expanded overseas. According to incomplete statistics, among the new power battery projects in 2023, Chinese power battery companies initiated a total of 12 new projects overseas, with a cumulative planned capacity exceeding 400GWh. Most of these projects are scheduled to start production between 2024 and 2026.
In February 2023, CATL announced a collaboration with Ford to build a new power battery factory in Michigan, USA, producing lithium iron phosphate batteries with plans to start production in 2026. In October of the same year, CATL revealed plans for a 100GWh capacity battery factory in Hungary, with construction of the first phase already underway and expected to be completed in around two years.
Guoxuan High-Tech also expanded its power battery industry in Morocco, Slovakia, and Germany, with plans for a battery factory with an annual capacity of 100GWh in Morocco.
EVE Energy made progress with four projects in overseas markets. Among them, the lithium battery manufacturing project in Malaysia started construction in May, and in June, it announced an investment of no more than CNY 9.971 billion in the development of a large cylindrical battery project for passenger cars in Debrecen, Hungary. In addition, the 6GWh battery production base in Thailand and the battery factory in the United States were signed in July and September, respectively.
In addition, Xinwanda and Rui Pularjun are also expanding their factory layout in overseas markets. On August 9, 2023, Xinwanda announced an investment of about CNY 1.9 billion through its subsidiary in Hungary to build the first phase of a new energy vehicle power battery factory, mainly engaged in the manufacturing and sales of lithium-ion batteries and power battery systems. The Hungary project is Xinwanda's first self-owned production base in Europe and its third overseas factory following the global layout initiated in New Delhi, India, in 2017.
It is evident that power battery companies expanding overseas is a trend. Bloomberg predicts that by 2025, global demand for power batteries is expected to reach 1200GWh. In addition, analysts at Gasgoo Automotive Research Institute predict that global demand for power batteries is expected to exceed 1TWh in 2024.
