Cui Dongshu: In January 2025, the loading of lithium batteries will reach 38.8Wh, an increase of 20% year-on-year.

On February 22, Cui Dongshu stated that in January 2025, the energy density of lithium batteries installed in electric vehicles was 38.8Wh, a 20% increase compared to the previous year. The installation of ternary batteries decreased by 33%, accounting for 22%, lower than the same period last year; while the installation of lithium iron phosphate batteries increased by 53%, accounting for 78%, although the growth of ternary batteries has slowed down. According to the qualified certificate for battery measurements, the production of new energy vehicle qualified products in January 2025 was 800,000 units, a 12% increase year-on-year but a 48% decrease compared to the previous month. The proportion of vehicles with an energy density of 160 and above in January 2025 was 10%, which showed a significant decrease compared to 18% in 2023, primarily due to the decrease in energy density brought about by the substitution of ternary batteries with lithium iron phosphate batteries. Products with an energy density below 125 decreased from 9% in 2023 to 1% in 2025. In the past two years, the new energy vehicle and energy storage industries have been highly prosperous, leading to a rapid growth in demand for batteries. The installation of batteries in new energy vehicles has decreased. Due to the slowing growth in the export market for electric vehicles, the demand for battery installations in electric vehicles has been slow compared to the overall domestic vehicle output. The difference in growth between ternary lithium batteries and lithium iron phosphate batteries has been formed due to the high prices of nickel and cobalt. With the growth of long-range products, ternary batteries still have a market, and the price reduction is driving the proportion of lithium iron phosphate batteries to continue rising. The competitive landscape of battery companies is dominated by Contemporary Amperex Technology and BYD Company Limited. The market share of Contemporary Amperex Technology in January 2025 has increased to 47.5%, with other battery companies showing a clear differentiation in market share. The battery companies have shown a slowdown in the concentration of top companies, with the top two companies accounting for 72% in 2022 and maintaining a 70% share in 2025, leaving about 30% of space for other companies. 1. Proportion of battery installations in power batteries Currently, the proportion of battery installations in power battery production is continuously decreasing. In 2021, the installation rate of power batteries for new energy vehicles reached 70%, which decreased to 54% in 2022, and further dropped to 50% in 2023. In 2024, the proportion of battery installations in power battery production rose to 50%, with ternary battery installation rate at 50% and lithium iron phosphate installation rate at 50%. In January 2025, the proportion of battery installations in power battery production dropped to 36%, with ternary battery installation rate at 41% and lithium iron phosphate installation rate at 35%. With the development of the energy storage industry, especially the world energy crisis brought about by the Russia-Ukraine crisis, the demand for batteries in the energy storage industry has grown rapidly, leading to a significant decrease in the proportion of battery installations, but an increase in the market share in December. Both power batteries and energy storage batteries are facing overproduction and relatively high inventory pressure. The growth rate of power batteries was lower than that of vehicles in 2021-2022, and the installation rate of power batteries was low in 2023-2024, with battery production keeping pace with installation growth. The start in 2025 was low, but is expected to improve in the future. 2. Continuous decrease in the proportion of ternary battery installations in domestic vehicle qualification certificates The demand growth for power battery installations is fluctuating. In 2019, demand increased by 10%; in 2020, power battery installations in domestic vehicle models was 64GWh, with a demand increase of 2%; in 2021, power battery installations reached 155GWh, a demand increase of 143%; in 2022, installations reached 295GWh, a demand increase of 91%; and in 2023, installations reached 388GWh, with a demand increase of 32%. In 2024, lithium battery installations reached 548GWh, a 41% increase compared to the previous year. In January 2025, the energy of lithium battery installations was 38.8Wh, a 20% increase compared to the previous year; the installation of ternary batteries decreased by 33%, accounting for 22%, lower than the same period last year; while the installation of lithium iron phosphate batteries increased by 53%, accounting for 78%, with the growth of ternary batteries slowing down. 3. Sustained strong growth in automotive battery demand The demand for passenger vehicle batteries continues to be strong, with a 26% increase in battery demand for pure electric passenger vehicles and an 82% increase for plug-in hybrid passenger vehicles in 2024. The demand for batteries in pure electric specialized vehicles has increased significantly by 101%. In January 2025, the growth reached 20%, with strong growth in commercial vehicles, especially a sharp increase of 95% in pure electric specialized vehicles in January, while plug-in hybrids declined. Looking at the proportion of battery installations in vehicles over the past few years, the demand structure for power batteries has been rapidly changing. In 2020, pure electric passenger vehicles ranked first, followed by pure electric buses and then pure electric specialized vehicles, with plug-in hybrid passenger vehicles in fourth place. However, by this year, pure electric passenger vehicles still maintained the top position, with plug-in hybrid passenger vehicles rising to second place, pure electric specialized vehicles moving up to third place, and pure electric buses dropping to fourth place. Over the past few years, the market for pure electric buses has sharply declined, while the demand for battery usage in pure electric specialized vehicles has been rising rapidly. Currently, the market share of pure electric buses has decreased from 18.5% in 2020 to a cumulative 1.7% in 2024, a decrease of 17 percentage points. The growth in battery usage for plug-in hybrid passenger vehicles has been relatively rapid, increasing from 7% in 2021 to 22% in 2024, an increase of 15%, while pure electric vehicles have decreased to 66%, maintaining a combined market share of around 90% for plug-in hybrid and pure electric passenger vehicles. 4. Automotive qualification certificate production According to the measurement of qualified certificate battery quantities, the production of new energy vehicle qualified products in January 2025 was 800,000 units, a 12% year-on-year increase but a 48% decrease from the previous month. In 2024, there were 11.68 million new energy vehicles, a strong 42% increase year-on-year, with 6.35 million pure electric passenger vehicles, a 21% increase; 4.71 million plug-in hybrid passenger vehicles, an 85% increase; and 540,000 pure electric specialized vehicles, a 45% increase, indicating a relatively good production data. 5. Supporting battery companies are far from fully competitive In recent years, the competitive landscape of the battery market has not undergone significant changes. Due to the relatively slow technological progress in the power battery market and an increase in scale.The long characteristics are relatively obvious, therefore, battery companies have obtained strong features of production and vehicle quantity growth.The original layout of the battery has not changed significantly, whoever invests the most will gain a larger market share, forming a strong performance of expansion by the leading battery companies; while small and medium-sized battery companies also have opportunities for growth through technological breakthroughs or other means. Therefore, the battery market structure can be considered relatively stable in the high-speed growth. However, there are relatively large chances for changes in the battery industry in the future. The trend of whole vehicle companies manufacturing batteries or joint ventures with related enterprises to manufacture batteries is becoming increasingly evident, and battery companies will gradually form core supporting products for whole vehicles. Currently, there is a strong demand for high-end electric vehicles in the market, as well as a demand for small and micro cars for daily commuting within families. Especially with the impact of the pandemic, there is a high demand for economical electric vehicles. However, the lack of tax exemptions for short-range electric vehicles in the second quarter of 2024 has led to a clear trend towards high-end vehicles. Recently, with policies promoting trade-ins for new electric cars, micro electric cars are becoming popular. Looking at the supply chain, whole vehicle companies will become stronger in the future, further strengthening their control over battery companies and the upstream industrial chain, as well as enhancing their control over brand marketing capabilities downstream. Under the new energy system, the characteristic of "whole vehicle is king" will continue to be highlighted. 6. The need for a decrease in the energy density of batteries The mainstream energy density range of batteries for pure electric vehicles is currently between 125-160. Particularly in the first quarter of 2025, the proportion of batteries with energy density between 125-140 reached 64%, which is an increase of 20 percentage points compared to the previous year. In January 2025, the proportion of vehicles with energy density above 160 was 10%, showing a significant decrease compared to 18% in 2023, mainly due to the decrease in energy density brought about by the substitution of ternary cathode materials for lithium iron phosphate batteries. The proportion of products with energy density below 125 decreased from 9% in 2023 to 1% in 2025. 7. Battery company structure The competition structure of battery companies is dominated by Contemporary Amperex Technology and BYD Company Limited. Contemporary Amperex Technology's market share in January 2025 has increased to 47.5%, while the market share of other battery companies shows a clear differentiation trend. There is a slowing down of the consolidation effect of leading companies in the battery industry, with the top two companies accounting for 72% in 2022 and still maintaining a 70% share in 2025, leaving about 30% space for other companies to compete. Lithium iron phosphate batteries have obvious product differentiation advantages. BYD Company Limited is relatively outstanding, but was in an adjustment period at the beginning of this year. Contemporary Amperex Technology's market share of iron lithium batteries has surpassed BYD Company Limited since the first quarter of 2024, and BYD Company Limited began to regain strength from April to June. Eve Energy Co.,Ltd. and Farasis Energy have performed well. Sunwoda Electronic, CALB, Ruipulan Jun, and Jidian New Energy have shown significant improvements. Due to BYD Company Limited's comprehensive transition to lithium iron phosphate batteries, the advantages of the top three companies like Contemporary Amperex Technology in ternary batteries are more prominent. Recently, Farasis Energy, Jiawan Technology Research, and Gotion High-tech have performed well. LG New Energy seems to be doing relatively well due to the increase in Tesla's domestic sales, but in reality, it is average.