Source: GF Securities Author: Chen Zikun, Ji Chengwei
First, domestic: 100,000-200,000 yuan to lay the cornerstone of technical parity
(1) Lithium iron phosphate + intelligent opening of demand space
The global penetration rate of new energy vehicles is increasing year by year. Since 2017, global auto sales have begun to show a downward trend, the global new energy vehicle penetration rate continues to grow, according to Marklines data, from January to October 2021, global new energy vehicle sales of about 4.779 million units, an increase of 125.5% year-on-year, penetration rate of 7.3%, compared with 2020 increased by 3.3pct.
The application of lithium iron phosphate batteries has expanded to more passenger car models, opening up sales space with cost advantages. In 2020, lithium iron acid batteries broke through more passenger car models, entering hot models such as Hongguang MINI EV, Tesla Model 3, BYD Han EV, etc. According to the recommended catalog disclosed by the Ministry of Industry and Information Technology, as of the tenth batch in 2021, the proportion of lithium iron phosphate batteries in the recommended model catalog in 2021 reached 42.6%, which was significantly higher than 14.9% in 2020. Lithium iron phosphate battery in the domestic market follow-up supporting Xiaopeng P5 and other models, is expected to further increase the proportion of installed capacity, and with the export of domestic Tesla Model 3, in 2021 overseas market lithium iron phosphate models to achieve a breakthrough from zero to one, lithium iron phosphate models are expected to further open up the sales space of new energy vehicles in the world with cost advantages.
In 2022, the global market will electrify the same frequency resonance. Since the third quarter of 2020, new forces and traditional car companies have intensively launched models, consolidating the trend of transformation from policy-driven to product-driven in the Chinese market in 2021, and policies support the rise of the separation mode of vehicle and electricity, and from 2021 onwards, traditional car companies will accelerate the launch of power replacement models, leverage the electrification of the public sector, and open up long-term growth space. In the overseas market, Europe in subsidies, tax incentives, carbon emission penalties and subsidies and other comprehensive adjustment means, 2021 still achieve a high growth rate, the U.S. market in the new energy SUVs and pickup trucks product cycle and policy acceleration stimulus, 2022 is expected to accelerate the upward trend, is expected to 2021, 2022 global new energy vehicle sales up to 622, 11.97 million units, respectively.
(2) The market of 100,000-200,000 yuan is expected to contribute a huge increment
100,000-200,000 yuan is the main price band for passenger car sales, and the replacement space for new energy vehicles is vast. After the popularization of domestic C-end passenger cars, at first less than 100,000 yuan of models for the absolute market mainstream, with the continuous decline in vehicle costs and the gradual improvement of residents' consumption power, in 2011 SUV market sales of 100,000-200,000 yuan models for the first time exceeded 100,000 yuan or less, opened the curtain on the optimization of the domestic passenger car sales structure, so far 100,000-200,000 yuan is still the main price band of sales, according to traffic insurance data in 2020, the price band model sales of about 8.8 million vehicles. On the other hand, due to the scarcity of high-quality new energy models of 100,000-200,000 yuan, the new energy penetration rate of this price segment fell back to 5.1% in 2020, and with the listing of high-cost models such as BYD DMi and Xiaopeng P5, it is expected to further enhance its market penetration.
The pattern of domestic new energy passenger vehicles is high and low. Since 2020, the A00 small models represented by the Wuling Hongguang MINI EV have consolidated the demand for economics, and the sales of B-class cars have increased significantly due to the localization of Tesla and the best-selling of domestic new forces. The price band of 100,000-200,000 yuan generally corresponds to A-class models, while the potential price band of A-class new energy passenger cars lacks explosive high-quality models, making the new energy vehicle market present a dumbbell-shaped pattern with two ends and a small dumbbell in the middle in 2020. In the second quarter of 2021, new models such as BYD DM-i will gradually increase the sales share of A-class vehicles.
Demand side: 100,000-200,000 market penetration rate increase space is larger. Small models below 100,000 yuan meet the needs of downstream basic economies, and the penetration rate in the first three quarters of 2021 reached 19.2%. With the localization of Tesla and the rise of new power car companies, the penetration rate of this segment has increased rapidly, and the penetration rate of more than 2021 has risen sharply to 18.6% in the first three quarters of 2021, highlighting the brand power of new energy vehicles and the ability to explore intelligent prices. 10-200,000 intermediate price band Due to the scarcity of high-quality new energy models on the supply side, the penetration rate in 2020 slipped to 5.12%, with the increase in sales of models represented by BYD DMi, the market penetration rate of 100,000-200,000 yuan in the first three quarters of 2021 reached 8.5%, an increase of 3.3pct compared with 2020.
Supply side: High-quality models enter the potential price band. From 2021 to 2022, the 100,000-200,000 new models on the market include Xiaopeng P5, Zero-Run C11, Nezha S/U, GAC AIONS 2021 Edition, GAC AION Y, Great Wall WEY Latte DHT, BYD Dolphin, Qin DM-i, Song Pro DM-i, Yuan Plus, etc., mainly small and medium-sized compact models. With the listing and delivery of new models in the price band, superimposed Tesla Model 3/Y, Weilai and other high-priced models to modify lithium iron phosphate to create a sales explosion, the scarcity of high-quality models on the supply side of 100,000-200,000 price belt new energy vehicles is expected to ease.
In 2022, the price of 100,000-200,000 yuan is expected to achieve a breakthrough in cost-effective and intelligent models. Within the price of 200,000 yuan, Xiaopeng P5 pure electric mileage starts from 600 kilometers, leading the competitors at the same price, equipped with Xavier chip computing power is stronger than the mainstream platform, a total of 32 sensors are equipped to ensure the quality of intelligent driving information input, and create a unique intelligent label through the localization of intelligent driving experience. The Dolphin of BYD e platform 3.0 is carrying the banner of pure electric cost-effective products, with software and hardware layered decoupling, stronger expansion and upgrade capabilities, electric drive system for 8-in-1 module, comprehensive efficiency of more than 89%, standard with body integration of blade battery and new heat pump technology; DM-i model is equipped with super hybrid system, 1.5 liters of high-efficiency engine, Atkinson cycle working mode, compression ratio of 16:1, thermal efficiency of 43%, fuel consumption in the state of power loss as low as 3.8L / 100 kilometers, With strong cost-effective advantages, accurate penetration of the A-class fuel vehicle market of 100,000-200,000 yuan.
Second, overseas: The European and American markets have accumulated strength
(1) European market: Carbon emission pressure increases sustainability
Europe continues its high boom in 2021. In 2020, Europe launched the world's strictest carbon emission regulations, and the European market is welcoming a high boom under the encouragement of bottom-up profit expansion and top-down carbon emission assessment. According to Schmidtautomotive Research, from January to October 2021, the total sales of new energy vehicles in Europe reached 1.76 million units, an increase of 91.38% year-on-year, driving the penetration rate of new energy vehicles to increase significantly to 13.00%.
With the introduction of the Fit for 55 act, European carbon emissions standards have become significantly stricter. In July 2021, the European Union officially introduced the Fit for 55 act, which aims to increase the output of the EU economy while reducing carbon dioxide emissions to ensure that greenhouse gas emissions in 2030 are 55% lower than in 1990. The bill plans to reduce the average emissions of new cars by 55% from 2030 (based on 1990 levels), and all new registered cars must achieve zero emissions from 2035. In the short and medium term, Europe will vigorously promote the production and sales of new energy vehicles and power batteries, while accelerating the construction of supporting facilities such as charging piles to promote the realization of carbon emission reduction goals.
Policy subsidies continued, and some countries declined slightly. From the end of 2019 to the first half of 2020, in order to cope with the EU's strict carbon emission assessment requirements and hedge the impact of the new crown epidemic on the economy, Europe has intensively launched new energy vehicle support policies, such as Germany's continuous increase in subsidies for new energy vehicles, the EU's proposed exemption from zero-emission vehicle value-added tax, and France's release of an 8.8 billion euro car assistance plan. In 2022, the subsidies of the main countries in the European new energy market continued, and some countries such as France, the Netherlands, and the United Kingdom showed a slight and slow decline.
New models such as Nissan Ariya, Mercedes-Benz EQA, renault Kangoo E-Tech Electric and other new models are in line with European car preferences and are expected to continue to promote the replacement of popular models. European traditional car companies occupy the mainstream market, Volkswagen, Renault-Nissan-Mitsubishi, Stellantis and other car companies in 2021H2-2022 to accelerate the launch of new energy models, such as Nissan Aria, Mercedes-Benz EQA, Renault Kangoo E-Tech Electric and other European car preferences, is expected to continue to promote the replacement of popular models.
(II) The US market: The acceleration of policies is expected to usher in an inflection point in demand
The huge potential of the U.S. market needs to be unleashed. According to ANL data, from January to October 2021, the sales of new energy vehicles in the United States were 562,000 units, up 127% year-on-year, and the penetration rate of new energy vehicles in the United States was 4.28%, an increase of 2.12pct compared with 2020. With the Biden administration's new round of clean energy emission reduction and electrification replacement policies, and the strengthening of strong purchase subsidy policies, the US new energy vehicle market has gradually released huge potential.
The Biden administration has pushed the rapid development of the new energy vehicle industry chain in the United States. In 2021, since the "U.S. Employment Plan" released in January proposed to support the electric vehicle industry chain with $174 billion, relevant incentive policies have been introduced; in April, the "Alternative Fuel Corridor Program" and "National Highway Performance Project" were introduced to promote the construction of infrastructure equipment for electric vehicles; in May, the "U.S. Employment Plan" further refined the allocation of 174 billion yuan of investment quotas, the U.S. Clean Energy Act strengthened tax relief, and eligible vehicles can enjoy tax incentives to 12,500 US dollars / year.
On August 5, Biden signed the Executive Order on Strengthening U.S. Leadership in Clean Cars and Trucks, which sets a target of 50 percent U.S. emission-free vehicle sales by 2030, reinforcing the impact of policy cycles on the market in conjunction with federal fuel economy standards, a maximum subsidy of $12,500 (home-grown assembly + U.S. labor organization membership), and federal-level policies such as higher ramp-off thresholds and full electrification of government fleets. On November 19, the US House of Representatives passed the US President Biden's previously proposed $1.75 trillion economic stimulus bill - "Rebuild a Better Future Act", which intends to extend the withdrawal time, cancel the 200,000 yuan subsidy limit for single car companies and provide additional subsidies for new energy vehicles and power batteries produced in the United States.
The structure of US car companies is conducive to the entry of domestic supply chains. In the U.S. market, Tesla dominates the sales of new energy vehicles, according to SNE Research, From January to September 2021, Tesla's market share in the U.S. new energy vehicle market reached 55.6%, unlike the deep binding of established car companies and Japanese and Korean supply chains, Tesla has opened up the local supply chain in the Chinese market, considering the strong demand in the United States and global cost optimization, the Shanghai factory has completed the transformation of the main export center. At the same time, Fisk also signed a supply agreement with CATL in November 2021, and Guoxuan Hi-Tech announced the signing of a strategic agreement with a well-known listed car company in the United States, and the new power car companies in the United States are expected to gradually incorporate the parity plan of China's new energy vehicle supply chain enterprises.
F-150 Lightning and R1T enrich the electric pickup truck market. Traditional car companies entered the new energy vehicle market, Stellantis (PSA and FCA merger enterprises), GM and Ford and other established car companies will transform classic models into electrification, with the help of previous star models to open the electrification market, such as the GM Hummer, Ford F-150 launched an electric version of the model. New power car companies have accelerated the layout of segments of the market, Rivian launched R1T to seize the electric pickup truck market, Lucid Air layout high-end electric car field.
Third, the supply chain: technology transmutation through the cycle
(1) Power battery: lead technological innovation and accelerate overseas penetration
In 2017, the domestic subsidy policy oriented by high energy density and long mileage opened the dividend period of the power battery material link, and the penetration rate of new technology processes in each link increased rapidly, such as the ternary material of the cathode link and the wet process of the diaphragm link. After years of hard work, China's battery materials enterprises have formed a global competitiveness of product technology research and development and cost reduction capabilities, and gradually switched from non-power products to high-end power products, such as Enjie shares from LG Chemical and Samsung SDI consumer products, and began to introduce LG Chemical and Panasonic power products at the end of 2018; Dangsheng Technology benefited from the demand for Samsung SDI and LG chemical energy storage in early 2018, and in 2019, it was certified through SK innovative power products. So as to seize a new round of growth opportunities to rank among the forefront of the industry.
In 2019, the cruising range of mainstream pure electric passenger cars exceeded 350km, which was significantly improved compared with 2017, and exceeded 400km by 2020, with a maximum of more than 700km, and the anxiety of battery life was greatly reduced, with the new process application of battery materials and overseas customers expanding to achieve phased results, the industrial chain dividend was gradually switched from the material link to the battery link. Power battery companies promote the progress of export substitution by improving the comprehensive manufacturing capacity of cost and technology, such as CTP and CTC technology in the Ningde era, STRUCTURAL innovations such as BYD blade battery, Guoxuan hi-tech JTM technology, and lithium iron phosphate technology have promoted a significant decline in battery costs, greatly enhancing the comprehensive competitiveness of Chinese local enterprises.
From the perspective of the global battery market, local companies have emerged from the huge Chinese domestic demand market. According to SNE Research, with the rapid development of the domestic new energy automobile industry, in 2017, CATL surpassed Japan's Panasonic to become the world's largest power battery manufacturer, with sales reaching 11.85GWh, and sales in 2018, 2019, 2020 and January-October 2021 won the championship, with a market share of 21.9%, 27.9%, 25.9% and 31.6% respectively.
Domestic battery companies use diversified technological innovation to accelerate global technology output. From the perspective of technical reserves, Ningde Era has gained a leading global competitive advantage by virtue of its structural innovation (CTP, CTC) and perfect technical layout in the material system, while the technical advantages of BYD and Guoxuan Hi-Tech are mainly reflected in lithium iron phosphate batteries, respectively, through structural innovations such as blades and JTM to expand the application range of lithium iron phosphate, Guoxuan Hi-Tech also undertakes the key special projects of the Ministry of Science and Technology to develop more than 300Wh/kg high-nickel soft pack batteries, while Fu Neng Technology has advanced soft pack battery production capacity. With the rapid growth of the domestic lithium battery industry chain, local battery companies have gradually accelerated technology integration, such as the establishment of two joint ventures between CATL and ATL to enter the medium-sized battery business in the fields of household energy storage and electric two-wheelers, and ATL has obtained a lithium battery technology license and paid 150 million US dollars per year to CATL.
Domestic lithium iron phosphate products continue to break through the bottleneck. In 2020, the energy density of the lithium iron phosphate battery system of Ningde Times, Guoxuan Hi-Tech and BYD will reach 140Wh/kg, opening up the application range of the passenger car market. Guoxuan Hi-Tech is known for lithium iron phosphate technology, combined with soft packs, silicon carbon anodes, JTM and other processes and technologies, Guoxuan Hi-Tech high-energy density 300Wh/kg ternary batteries to achieve loading, 230Wh/kg lithium iron phosphate batteries and 110Ah semi-solid-state batteries have made breakthroughs in research and development, and BYD's lithium iron phosphate system energy density will continue to explore under the drive of blade battery technology.
(1) CTP (Cell to Pack, moduleless power battery pack) technology: the battery cell is directly integrated into the battery pack, eliminating the module link can effectively improve the space utilization and energy density of the battery pack. The CTP battery pack launched by CATL is 15%-20% higher than the traditional battery pack volume utilization rate, the number of parts is reduced by 40%, the production efficiency is increased by 50%, the system cost is reduced by 10%, and the cooling performance is increased by 10%. In terms of energy density, the energy density of traditional battery packs averages 140-150Wh/kg, and the energy density of CTP battery packs can reach more than 200Wh/kg. According to Sohu News, Liang Chengdu, co-president of CATL R&D, introduced at the 2020 World New Energy Vehicle Conference that the company plans to achieve CTP battery technology without heat diffusion in 2022. CATL CTP battery packs are now supported by BAIC BJEV, Weilai, Daimler and other car companies.
The CTC (Cell to Chassis) battery technology of the Ningde era, that is, the integration of batteries into the chassis, can be regarded as a further extension of CTP technology. CTC technology will not only rearrange the battery, but also incorporate the three-electric system, optimize power distribution and reduce energy consumption through intelligent power domain controllers, and aim to complete technology development by 2030. According to Lin Yongshou, president of the passenger car solution department, at the 5th International Summit on Power Battery Application, new energy vehicles using CTC technology can reduce weight by 8%, reduce the cost of power system by at least 20%, increase the cruising range by at least 40% to 1000 kilometers, and reduce the power consumption of 100 kilometers by 12 degrees. Based on the cooperative relationship between CATL, Changan Automobile and Huawei to jointly build a new high-end intelligent car brand, and Changan New Energy's planning to break through the key technologies of CTV (Cell to Vehicle) and MTV (Module to Vehicle), CTC technology of CATL is expected to accelerate the progress of industrialization.
(2) Blade battery: BYD blade battery has changed the cell arrangement method and structure, so that the battery pack shape is thin and long, using modular design, the cell length range from 435mm to 2500mm, with high safety, long endurance, long life characteristics, compared with traditional batteries, the volume specific energy will increase by 50%, cost reduction of 30%, cruising range of 600km, life of up to 8 years 1.2 million kilometers. BYD lithium iron phosphate blade batteries will be mass-produced in March 2020, with the first model being the BYD Han EV launched in July 2020, followed by the 2021 Tang EV and Song Plus EV, as well as the Didi custom model D1.
(3) Guoxuan Hi-Tech JTM (Jelly Roll to Module) technology: As a new core-to-module integration technology, it can greatly reduce the production cycle and battery costs, and the battery and module components will also be significantly reduced. According to the company, the technology is both low cost and high efficiency, and the efficiency of the monomer to module can exceed 90%. The energy density of the module using the lithium iron phosphate material system can be close to 200Wh/kg, and the system energy density is 180Wh/kg, which can reach the level of high nickel ternary batteries, and the process is simple and easy to form a standardized module, which has strong adaptability and is compatible with the size specifications of different modules.
Lithium iron phosphate batteries open up overseas acceptance, boosting the global market share of Chinese battery companies. Since 2020, China's power battery companies have successively launched the output and supply of international car companies, of which the overseas orders of the Ningde era took the lead in 2020, and ushered in the delivery inflection point in 2022; Guoxuan Hi-Tech cooperated with Volkswagen, Volkswagen China became the largest shareholder, and established a subsidiary of the United States Guoxuan; Fu Neng Technology began to supply Daimler in 2021, and other enterprises such as Honeycomb Energy also entered the stage of large-scale supply of overseas orders. With Tesla in 2020 and Volkswagen opening the lithium iron phosphate model cycle in 2023, lithium iron phosphate batteries are expected to open up overseas acceptance and promote the continuous improvement of the global market share of Chinese companies.
(2) Lithium iron phosphate: continue to build barriers and open the road to advancement
The new process continues to be industrialized, and the long technology cycle of lithium iron phosphate will begin in 2021. Iron phosphate solid phase method is the current mainstream process, in early 2021 German nano high cycle iron nitrate liquid phase method Qujing base smoothly put into production, at the end of 2021 Fulin Seiko subsidiary Jiangxi sublimation using high compaction performance ferrous oxalate process is expected to achieve large-scale mass production; in September 2021, German nano announced the proposed construction of Qujing 100,000 tons of phosphate project, it is expected that in 2023 lithium iron manganese phosphate and iron red process of lithium iron phosphate is expected to achieve large-scale mass production, promote long-term technology upgrading of lithium iron phosphate.
Lithium iron phosphate materials are mainly divided into solid phase method and liquid phase method from the perspective of production process. The solid phase method prepares lithium iron phosphate by calcining carbon coating at high temperature after mechanical grinding, and the liquid phase method mixes raw materials in liquids, and prepares lithium iron phosphate after sintering into gel precursors by self-heating. According to the production process + iron source, it can be further divided into four routes: solid phase method + iron phosphate, solid phase method + ferrous oxalate, liquid phase method + iron nitrate, liquid / solid phase method + iron red.
(1) The solid phase method + iron phosphate process is mature, accounting for 80% of the synthesis process of lithium iron phosphate, the process is easy to control, and the product gram capacity is high. However, compared with the liquid phase method, the mixture of materials is uneven, and it is more dependent on the precursor iron phosphate production capacity and physical and chemical quality.
(2) The solid phase method + ferrous oxalate process is simple, the compaction density of the material is high, and the cycle attenuation is less, but a large amount of ammonia, water and carbon dioxide will be generated during the sintering process, and the production safety risk is high.
(3) Liquid phase method + iron nitrate process raw materials from a wide range of sources, can be purchased iron blocks and nitric acid self-made iron nitrate to reduce the cost of synthesis, alleviate the precursor supply bottleneck. The material is mixed evenly in the liquid phase, and the product consistency is high, but the production control is difficult.
(4) The iron source of the iron red process is iron oxide, which is safer than other processes and the raw material price is low, which can improve the conductivity of the material, and the iron source is non-toxic and the environmental protection cost is lower. There are good low temperature and magnification performance, but the battery-level iron red should strictly control the purity and particle size distribution, and the requirements for iron source iron red are higher.
The liquid phase product of iron nitrate has strong circulation performance and superior compaction density of ferrous oxalate process. Liquid phase method such as Defonna DY-1 series iron-lithium material cycle 6000 weeks, capacity retention rate of 80%. The cost of lithium iron phosphate raw materials depends on upstream lithium sources, phosphorus sources, iron sources, etc. There are differences in cost reduction paths for different routes. Ferrous oxalate can use lithium phosphate as a lithium source and phosphorus source at the same time, the cost reduction path is clear, the space is large, and the compaction density is high, which has great advantages in the high-end power field. The process route of lithium ferromanganese phosphate is consistent with lithium iron, with higher compaction density, higher voltage window and better low temperature performance.
Lithium iron phosphate is a bulk trend, and the concentration of the industry is increasing. Lithium iron phosphate material industry since 2017 after the process continues to mature, homogenization competition protrudes, on the other hand, liquid phase synthesis method and other low-cost processes in the price forced to gain market favor, related companies quickly opened sales channels, to 2018 Waterma incident related lithium iron phosphate suppliers were dragged down, the industry concentration was further improved, forming a market pattern with German nano as the leader, from 2020 by passenger cars, small power and other new products, Hunan Yuneng and other suppliers market share significantly increased.
The trend of industrial chain cooperation has gradually strengthened, and we have worked together to ensure the supporting supply chain. Under the rapid rise in demand, the layout of enterprises will test the supply chain supporting and bulk layout capabilities, similar to Tianci Materials - Sanning Chemical, Fulin Seiko - Chuanheng Shares and Guangdong Bangpu - Hubei Yihua, with process innovation to establish technical advantages while relying on chemical synergy to establish cost advantages will reconstruct industry barriers, such as purification of phosphoric acid, hydrogen peroxide and other pipeline transportation can save transportation and packaging costs, while Ningde Times / Yiwei Lithium Energy - German Nano and so on in the typical upstream and downstream joint venture model to jointly build production capacity to ensure stable supply It strengthens the cooperation trend of lithium iron phosphate industry chain.
The supply chain management and cost reduction capabilities corresponding to the four-in-one comprehensive layout of phosphorus, acid, iron and lithium will become the winner and loser of laying the position of the industry's cost curve. At present, the industry is still in the high boom cycle brought about by the imbalance between supply and demand since the end of 2020, and the lithium iron phosphate industry chain is gradually moving towards bulk, which further tests the potential of enterprises in supply chain management and process innovation and cost reduction. Enterprises that can grasp key resources and master innovative process routes on phosphorus/iron/lithium sources will have long-term competitiveness.
(3) Additives: determine the long-term electrolyte competition pattern
Four rounds of industrial dividends, reshaping the global pattern. In 2001 the electrolyte to achieve localization, in 2004 the global production share of domestic enterprises increased year by year, to Cathay Huarong, Tianjin Jinniu as the representative of domestic manufacturers have successively supported domestic lithium battery customers, the global share reached more than 30%, around 2011 in the electrolyte important raw material lithium hexafluorophosphate in polyfluoride, Tianjin Jinniu and other manufacturers to achieve localization, the cost advantage is further exerted, after 2014 shunli broke through 50% of the global share, to 2017 has reached 69%, China has become the world's largest producer of electrolytes. In 2016, the advantages of liquid hexafluorine technology began to emerge, and Tianqi Materials grasped the opportunity of the technical window and gradually reached the top of the electrolyte dragon. Since the second half of 2020, lithium hexafluorophosphate has taken the lead in shortage, since the end of 2020, the industry has ushered in a new round of expansion tide, and from the second half of 2022, with the gradual release of new production capacity, lithium hexafluorophosphate has returned to a reasonable profit level in the long run. The core additives such as LiFSI, VC, FEC have a longer expansion cycle, the boom cycle starts later, continues longer, and is expected to lead the fourth round of industrial dividend period of the electrolyte industry in 2022.
Additives determine the basic physicochemical properties of the electrolyte and help to improve its performance indicators. Electrolyte additive refers to the addition of additives added to the electrolyte to improve the electrochemical properties of the electrolyte and improve the quality of cathodic deposition. There are many types of electrolyte additives, the proportion of quality in the electrolyte is small, the unit value is high, and the conductivity, flame retardant performance, overcharge protection, and magnification characteristics of the electrolyte can be optimized in a directional manner without increasing the production cost and changing the production process. With the improvement of the battery factory's performance requirements for safety, charge and discharge rate, cycle life, high voltage characteristics, etc., the complexity of the formula required for the electrolyte and the diversity of the additives adapted to it will gradually increase, the importance of electrolyte additives is particularly prominent, and its research and development and application have increasingly become one of the core competitiveness of electrolyte enterprises.
According to the chemical structure of the additive, the additive can be divided into cyclic carbonate additives, organic ester acid additives, sulfonate additives and new lithium salt additives. Common electrolyte additives mainly include a variety of new lithium salts and traditional VC, FEC and other ester substances, with SEI film, flame retardant and other effects, added to the electrolyte to improve its electrochemical stability, thermal stability, energy density, low temperature performance, cycle performance and other indicators.
1. Traditional additives: embracing high boom cycle VC and FEC are more widely used electrolyte additives. Vinylene carbonate (VC) is the core additive in the electrolyte of lithium batteries, which can form a solid electrolyte interface film (SEI film) during the initial charge and discharge of lithium batteries in an electrochemical reaction on the surface of the negative electrode. FEC Additive is a core additive developed for the electrolyte of high-magnification power batteries. It can enhance the stability of the electrode material.
The domestic VC and FEC market pattern is relatively concentrated. According to EVtank data, China's VC shipments in 2020 will be 6800 tons, of which Jiangsu Huasheng ranks first with a market share of 31.40%, followed by Hankang Chemical and Aoki High-tech, with a market share of 14.10% and 11.80% respectively. In 2020, Jiangsu Huasheng FEC shipments accounted for 48.80% of the total domestic FEC shipments, ranking first in the FEC market segment, followed by Hankang Chemical and Suzhou Huayi, with market shares of 27.14% and 11.43% respectively. With the announcement of Yongtai Technology on August 20, 2021 that the Phase III project in Inner Mongolia has entered the trial production stage, Yongtai Technology has formed a production capacity of 5,000 tons of VC and 3,000 tons of FEC, and the VC production capacity ranks first in the industry.
The growth in demand for lithium iron phosphate has led to a significant increase in VC production. The main role of VC is to improve battery capacity and cycle life, because the proportion of VC added to lithium iron phosphate batteries is much higher than that of ternary batteries, since 2020, the production and sales of lithium iron phosphate have picked up, driving VC production to reach about 6800 tons, an increase of 87.38% year-on-year.
The expansion of domestic additive planning capacity is accelerating, and the situation of VC supply exceeding demand is expected to continue. With the rapid expansion of demand, the planned production capacity of domestic electrolyte additives continues to grow, but the production of additives such as VC has higher requirements for safety and environmental protection, so it is difficult and long to expand rapidly. Since 2021, due to the substantial increase in demand, domestic VCs have been seriously out of stock, and the market price has risen rapidly to 320,000 yuan / ton in July 2021. In 2020, the domestic VC production is 0.68 million tons, and the domestic electrolyte shipment is 250,000 tons (high-tech lithium battery caliber), the proportion of VC addition is about 2.72%, assuming that with the increase in the proportion of lithium iron phosphate batteries, the proportion of VC addition will increase, assuming that the proportion of VC addition in 2021-2022 is about 3% and 4%, we estimate that the VC demand in 21-22 is expected to be 20,000 and 45,000 tons, respectively, and the supply gap continues to expand. On September 1, 2021, Yongtai Technology announced the 25,000-ton VC and 5,000-ton FEC projects, and the planned production capacity is in the leading position in the industry.
2. New lithium salt: the next commanding height, industrialization is accelerating
The new lithium salt as an additive can improve the performance of the battery, and the proportion of addition is expected to gradually increase. At present, the mainstream lithium salt lithium hexafluorophosphate in terms of thermal stability, conductivity and other properties are insufficient, and due to the characteristics of the production process, lithium hexafluorophosphate will continue to decompose to produce hydrofluoric acid resulting in deterioration of battery performance; in addition, lithium hexafluorophosphate is easy to crystallize in low temperature environment, resulting in reduced conductivity and improved battery internal resistance. In recent years, the emergence of new lithium salts mainly include LiFSI, LiTFSI, LiBOB, etc., as an additive to use new lithium salts can improve the performance of SEI membrane in the electrolyte and improve the thermal stability of the electrolyte. LiFSI (bisfluorosulfonylimide lithium) in terms of stability and conductivity is expected to make it a new lithium salt suitable for high specific energy batteries, the current LiFSI addition ratio of electrolyte manufacturers is basically around 3%-8%, with the increase in battery energy density requirements, the future LiFSI addition concentration is expected to gradually increase.
LiFSI has the advantages of good thermal stability and hydrolysis resistance, and is currently the most promising new lithium salt, which determines the key advantages of the next generation of electrolyte. LiFSI has the advantages of lithium hexafluorophosphate and lithium tetrafluoroborate, and has obvious advantages in thermal stability, sensitivity to moisture, conductivity, etc., but the difficulty of production leads to high production costs, and it is easy to produce complexions that are corrosive to aluminum foil, restricting its commercial use. The main uses of LiFSI are two: (1) as an additive: the current mainstream use, mainly suitable for high-end passenger car lithium-ion battery materials; (2) as an electrolyte use: with the breakthrough of production technology and cost reduction, LiFSI or will be used as a main salt.
The LiFSI synthesis process is gradually optimized. The synthesis process of LiFSI is complex, and it generally needs to go through three steps of raw material synthesis of dichlorosulfonimide (HClSI), fluoride to bisfluorosulfonimide (HFSI), and lithionization to liFSI. The traditional three-step method requires a multi-step reaction to obtain HClSI, with many types of intermediate products and high product extraction requirements, and is currently used less. Optimization three-step method is the current mainstream process, the method by changing the selection of raw materials, optimize the first step of the process of combining HClSI, reduce the reaction steps and reaction product types, the current Tianqi materials, new Zebang, polyfluoride and other enterprises are using the optimization three-step method. The two-step method generates HFSI or HFSI-like HFSI through direct reaction of raw materials, reducing fluorination and further optimizing the production process.
At present, there are three main types of domestic LiFSI manufacturers: electrolyte enterprises such as Tianci Materials and Xinjiubang, fluorine chemical enterprises such as polyfluoride, Yongtai Technology, and Times Sikang, as well as professional additive enterprises such as Huasheng Lithium Battery and Kangpeng Technology, and the different process routes used vary greatly in the availability of raw materials and environmental protection treatment, which in turn leads to a large difference in cost and production capacity elasticity.
(1) From the perspective of availability of raw materials, the global industry scale of sulfamic acid is about 200,000-300,000 tons, and its raw materials are mainly urea and fuming sulfuric acid, urea is more readily available as a bulk chemical, and the scale of the fuming sulfuric acid industry is relatively small; the sulfonyl fluoride reaction efficiency is high, but there are challenges in the supply chain; dichlorosulfoxide is mainly used for the production and use of sucralose, the industry scale is less than one million tons, and the production capacity of the leading companies Kaisheng New Material, Shilong Industry, and Jinhe Industry is not more than 100,000 tons Chlorosulfonyl isocyanate isocyanate is generally obtained by the reaction of cyanide chloride and sulfur trioxide, the scale of the raw material industry is relatively small, and the reaction conditions for the direct preparation of LiFSI by using chlorosulfonyl isocyanate are relatively harsh.
(2) From the perspective of by-product consumption and environmental protection, the main by-product sulfides and chlorides in the production process of LiFSI will produce NOx pollution in the optimization three-step method 1 process. Under the requirements of environmental protection, the production line needs to strengthen the control of pollutant emissions, because the pollutants are mostly HCl, SO2, NOx and other acid substances, the current mainstream pollutant control methods have multi-level water absorption method, multi-level lye absorption method and activated carbon adsorption method, etc., the economic value of pollutant treatment is difficult to fully make up for the cost of environmental protection, recycling is the most economical method. Usually, hydrogen chloride can be recycled for chlorosulfonic acid production, while sulfur dioxide can be used to recover the production of sulfuric acid, such as the sulfuric acid cycle used in the production of the heaven-given material lithium hexafluorophosphate, maximizing value through recycling, achieving capacity elasticity and cost advantages.
The industrialization of LiFSI has accelerated, and supply and demand have tightened. As a lithium salt with better performance, LiFSI has received great attention in the industry. In addition to the company and Japan and South Korea's established enterprises such as catalyst, Tianbao, domestic enterprises such as Tianci Materials, Longyan Sikang, Yanyi (Jiangshan), polyfluoride have 10,000 tons of planned production capacity, other such as Kangpeng Technology, Yongtai Technology, etc. also have thousands of tons of planned production capacity, LiFSI industrialization accelerated. At the end of 2020, Tianci Materials already has a production capacity of 2,000 tons of LiFSI, and currently plans to have a production capacity of about 60,000 tons, maintaining the leading edge in production capacity. With the rapid advancement of industrialization, LiFSI's quotation dropped from 800,000 yuan / ton in 2017 to 400,000 yuan / ton in 2021, but due to insufficient supply chain support, low operating rate, LiFSI's actual industry production capacity is lower than nominal capacity. With the improvement of the performance requirements of the power battery, the proportion of LiFSI addition will be further improved, and it is expected that the proportion of LiFSI added in 2021 and 2022 will be 3% and 4%, and the gap between supply and demand will expand significantly from 2022.
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