Image source @ Visual China
Wen | Zhixing arrived
Entering 2022, the soaring oil prices have allowed car owners to break the defense. Just when the owners of the oil trucks who were hurt by the "broken 9" oil prices turned their attention to pure electric vehicles, they found that the trams of various brands have also increased their prices. Among them, the price of Tesla Model Y rear-drive standard renewal has exceeded the 300,000 mark, BYD, Ean and other domestic car companies have also increased by thousands of yuan, even Wuling, which has always been known for its cost performance, its 2022 MINIEV, the same configuration is 2000 yuan higher than the 2021 model.
Since the second half of 2021, various car companies are struggling in a variety of lack of resources, first of all, the tight supply of chips has made many car companies choose to postpone delivery or deliver first and then install parts later, but the shortage of parts has not brought much impact to car companies in the terminal price, and brands such as Tesla have even carried out multiple rounds of price cuts. However, in 2022, in addition to the subsidy decline to increase the price of car companies, the price increase caused by the shortage of lithium and nickel resources has triggered a continuous rise in the price of vehicle power batteries, which in turn has made the terminal price of car companies finally unable to withstand the pressure and forced to raise prices.
However, in the face of changes in the supply of core components, car companies in addition to being forced to increase prices, naturally also have the initiative to attack, in this resource tug-of-war, to seize a certain initiative.
Where have lithium resources disappeared?
According to the 2021 economic operation data of the automobile industry of the China Association of Automobile Manufacturers, the output of new energy vehicles in the mainland in 2021 was 3.545 million units, compared with 1.366 million units in 2021, an increase of 159.5%, and from January to February this year, the output of new energy vehicles was 820,000 units, which was 2.59 times that of the same period last year, more than the total output of new energy vehicles in January and April last year, and close to a quarter of last year's total output.
The rapid growth of demand in the downstream of the industrial chain is transmitted to the upstream, and it is difficult for the resource supplier to respond quickly to expand the scale of production, which is bound to cause a shortage of raw materials and eventually lead to an increase in resource prices. At present, the global supply of lithium ore is mainly Australian lithium ore and South America Chile, Argentina and other countries, although the mainland has the world's third largest lithium ore reserves, but the ore quality and mining difficulty is higher.
Affected by the epidemic and transportation time, overseas lithium ore raw materials are difficult to quickly meet the domestic booming industrial development, although the domestic lithium mine has been accelerating mining, but due to the difficulty of mining and in the capacity climbing period, in the short term can not fill the demand gap, so lithium resources will continue to be scarce during the year, it is expected that in 2023, the tight supply situation can be alleviated. In addition, the supply of nickel, an important element required for lithium batteries, is also tight. According to CCTV Financial Report, affected by the current local conflict and the impact of the futures market, the current nickel price has exceeded $100,000 per ton, Morgan Stanley expects that the rapid rise in nickel prices will lead to an increase in the cost of a new energy vehicle by about 1,000 US dollars, equivalent to more than 6,000 yuan. With the gradual easing of the futures market, nickel prices may ease slightly in the foreseeable future, but they will still be at a relatively high price, which will also affect the manufacturing costs and retail prices of terminal manufacturers.
Car companies seize the opportunity of lithium ore resources
The development of the new energy automobile industry is similar to that of the smartphone industry to a certain extent. At first, most manufacturers relied on suppliers to supply core components and developed and grow together with the supply chain, and only a small number of enterprises were willing to build their own supply chains to achieve upstream and downstream resource synergy.
Nowadays, the lithium battery industry is in a state of tight resource supply, lithium mining enterprises in the upstream of the supply chain can still make profits by selling lithium ore resources, and battery manufacturers in the middle reaches can also use the lithium ore resources with the same supply as usual to sell batteries to the main engine factory. However, downstream car companies with increasing demand for batteries are facing a series of problems such as insufficient supply and rising prices in this crisis. Therefore, some enterprises with high control over the supply chain and sufficient financial resources reacted to this crisis, began to explore the upper and middle reaches of the industrial chain, and started from lithium ore resources to seize the opportunity of this resource battle.
As the vanguard of global new energy vehicles, Tesla signed a contract with Ganfeng Lithium as early as last November, agreeing that from 2022 to 2024, Ganfeng Lithium and its wholly-owned subsidiary Ganfeng International will supply battery-grade lithium hydroxide products to Tesla. This is the second cooperation between Tesla and Ganfeng Lithium, compared with the first cooperation, this time Tesla chose to purchase from Ganfeng Lithium and Ganfeng International by formulating battery suppliers, which may indicate that Ganfeng Lithium and Ganfeng International will be directly supplied to Tesla.
In addition, Tesla has also signed five-year supply contracts for 700,000 tons and 110,000 tons of spodumene concentrate to Australian lithium miner Liontown Sources and Core Lithium, respectively, and the two companies will supply spodumene concentrate to Tesla in the next few years. The reason why Tesla frequently seeks suppliers for lithium resource supply is because it has begun to explore the middle of the supply chain to produce lithium batteries. Tesla has partnered with Panasonic in 2021 to produce 4680 cylindrical batteries in California, USA, and according to official social media sources, Tesla's 4680 battery production has exceeded one million as of February 19 this year.
Compared with the previous purchase of 18650 batteries from battery suppliers such as Catalford Times and LG, Tesla and Panasonic's cooperation in self-produced batteries can ensure the stability of battery supply to a certain extent, and control the battery cost at a reasonable level at the moment when battery prices are soaring, and can purchase batteries from other suppliers, with self-produced batteries as chips to have stronger bargaining power, reduce the proportion of battery costs in the price of the vehicle, in order to stabilize the vehicle price and their own profits as much as possible, which is conducive to the sustainable development of their own business.
When the car company Tesla is trying to develop the battery business, BYD, which started with battery technology, went further, starting from the lithium mine mining link and laying out the competition for lithium resources. In January this year, BYD reached a lithium mining contract with Chile, obtaining a lithium production quota of 80,000 tons, seven years of exploration rights and 20 years of production rights, becoming the first Chinese enterprise to develop Chilean lithium mines. This time BYD won the bid for Chilean lithium mining, to a certain extent, can stabilize the supply of lithium iron phosphate blade batteries for its own passenger cars and the sales of ternary lithium batteries for external supplies, in the increasingly "inner coil" of independent new energy brands competition, not only can have a stable supply of resources, but also in the supply chain to grasp a certain right to speak.
The United States in the Americas lithium mine robbery, but also the use of national power, it can be said that the United States for lithium resources grab, has become as important as the oil resources grab as the national behavior. In order to grab lithium ore resources, China's giants in various fields have snapped up lithium ore resources around the world. Lithium industry giants Ganfeng Lithium and Tianqi Lithium have successively seized high-quality lithium resources through investment in shares and joint ventures in Chile, Argentina, Mexico, Quebec, Western Australia and other places, and Tianqi Lithium has also owed huge debts.
In addition to lithium resources, the demand for cobalt and nickel, which are important components of power batteries, is also becoming increasingly tight. According to relevant data, in 2019, the reserves of lithium ore were 17 million tons, and the reserves of nickel were 89 million tons, while the proven cobalt metal was only 7 million tons, less than a fraction of the former. In terms of production capacity, cobalt is also mainly concentrated in the three countries of Congo, Cuba and Australia, and the scarce production capacity makes the giants scramble to sign huge contracts with the giants. For example, Tesla signed a contract with cobalt mining giant Gleneng for an annual supply of 6,000 tons of cobalt metal. From the current point of view, this kind of robbery is not limited to cobalt, lithium and other minerals, and with the expansion of the industrial scale, the robbery of nickel and manganese, phosphorus, fluorine and other metal ores will also become more and more intense.
Tesla in Silicon Valley in the United States and BYD in Shenzhen, China, two major new energy vehicle companies on the east and west coasts of the Pacific Ocean, opened a new round of competition for lithium battery resources. New energy vehicle companies represented by these two major car companies, who can obtain more and better resources in this resource shortage environment, can more easily survive the difficulties and occupy a broader market, if in this competition a momentary negligence leads to failure to keep up with the pace of the times, may face a more serious business crisis. Therefore, Tesla and BYD and both have explored resources for more upstream supply chains in order to compete better in this competition.
Lithium is not necessary?
Why the rise in the price of lithium resources will make the car companies tremble, the core reason is that the battery technology that can really be put into the market can not avoid lithium. Whether it is the mainstream ternary lithium battery, lithium iron phosphate battery, or the rare lithium titanate battery, lithium solid-state battery, can not escape lithium or lithium metal as a positive and negative electrode material. Therefore, when new energy vehicles develop to a certain scale, it is inevitable to encounter the bottleneck of lithium resource shortage that hinders development.
So, can the battery not be used for lithium? The use of other batteries to replace lithium batteries is technically feasible, but in the current practical application, either the cost is too high, or there is no real mass production product. Although the prospect of achieving the "flat replacement" of lithium batteries is very bright, it will take time to truly land. Hydrogen fuel cells, which are now gaining momentum, are currently the emerging technologies that are most likely to replace lithium-ion batteries to some extent. It is different from conventional batteries that need to be stored through an external power supply and discharged, but through the chemical reaction of hydrogen with oxygen in the air to generate electrical energy. This model is similar to the internal combustion engine in a range extended range car burning fuel to power the motor, thus being figuratively named a fuel cell.
However, nowadays, hydrogen production and hydrogen storage technology is still not mature, the miniaturization of hydrogen fuel cells is still a problem that needs to be tackled, and the large-scale commercial use of hydrogen fuel cells is still too early. The National Development and Reform Commission recently released the "Medium and Long-term Planning for the Development of hydrogen energy industry (2021-2035)" plan said that it will basically master the core technology and manufacturing industry of the hydrogen energy industry in 2025, initially establish a complete supply chain and industrial system, and form a hydrogen energy industry system by 2035, and initially establish a complementary development model of fuel cell electric vehicles and lithium battery pure electric vehicles. That is to say, the promotion of hydrogen energy technology still needs time, and after its technology matures, it will be used as a complementary technology to replace lithium batteries to a certain extent. In addition to the unique hydrogen fuel cell, replacing lithium batteries with other elements as the positive/negative electrodes and contents of the power battery is also one of the current development directions.
In 2021, CATL released a sodium-ion battery, compared to lithium-ion batteries, sodium-ion batteries have the advantages of large resource reserves, low temperature and fast charging performance, long life, etc., but in terms of energy density is 20% lower than lithium-ion batteries.
In the family car, the low 20% endurance is obviously a fatal drawback, but in buses, heavy trucks, energy storage power stations, sodium-ion batteries can play their core advantages, thereby replacing lithium batteries. In passenger cars, CATL adopts the scheme of mixing and matching lithium-ion batteries and sodium-ion batteries AB batteries to achieve complementary advantages and help balance the vehicle power battery in terms of cost, life and endurance.
At present, CATL is developing the next generation of sodium-ion batteries, and the new generation of batteries will be improved in terms of energy density. At present, the technology has not yet been commercialized by car companies, and perhaps one day in the future, sodium-ion batteries will become the favorite of car companies. Manganese-based cathode batteries, which also have price advantages, have recently received Tesla's attention. Musk said at the opening of Tesla's German gigafactory that Tesla sees the potential of manganese-based cathodes in battery chemistry, and Tesla is currently exploring adding more manganese to batteries to explore more possibilities.
Manganese batteries are similar to sodium batteries, and their raw materials are in a large stock in nature, so the price is more advantageous than lithium batteries. In addition, manganese batteries are also superior to lithium batteries in terms of safety and low temperature performance. However, the technology is currently in the pre-research stage and is expected to be put on the market for some time.
Car companies are eyeing battery recycling
In order to further alleviate the crisis of lithium resource shortage, it is enough to rely on the "open source" behavior of seizing lithium resources, so car companies have started the idea of "throttling" decommissioned battery recycling.
In 2020, Tesla's official website has launched a battery recycling service in China, promising that the recycled lithium batteries can be used 100%. Like the battery rental business carried out by Weilai, it has also realized the recycling of battery resources to a certain extent. Most of these companies rely on existing power battery suppliers or recycling companies for battery recycling, which only plays a bridge role for users to recycling enterprises, and the role of their own battery supply is really small.
According to the "Industry Specification Conditions for the Comprehensive Utilization of Waste Power Batteries for New Energy Vehicles" issued by the Ministry of Industry and Information Technology, by the end of 2021, 27 enterprises have met the mainland power battery recycling standards, including battery manufacturers such as Ningde Times, Guoxuan Hi-Tech, and BYD. Among them, BYD, as a vehicle manufacturer and battery manufacturer, meets the dual specifications of cascade utilization and recycling.
At present, BYD has cooperated with China Tower Group in Shandong to carry out battery ladder recycling projects, using batteries with shrinking batteries for batteries with low storage requirements such as base stations, and then dismantling and recycling after the battery power is further attenuated, so as to strengthen the utilization rate of resources as much as possible, and finally all kinds of resources after disassembly can also be used for new battery production.
In addition to BYD, a giant with battery production, recycling and vehicle production capacity, other car companies are also exploring in-depth cooperation with battery recycling companies to carry out battery recycling business.
In January this year, the Department of Economy and Information Technology of Anhui Province released the pilot list of regional center enterprises (stations) for the recycling of new energy vehicles in Anhui Province in 21, including Guoxuan Hi-Tech and Jianghuai Automobile and Wuhu Chery and Anhui Ruisec. Although JAC and Chery do not currently have battery production capacity, it is also of certain significance for the future supply of lithium batteries by carrying out consortium construction with existing battery recycling enterprises and making good use of the existing eliminated battery resources.
Wisdom and action
2022 is destined to be an extraordinary year in the automotive industry, especially for the new energy automobile industry that has just embarked on a stable development path, or it will usher in a heavy blow. The increase in the price of batteries has reduced the consumer's desire to buy to a certain extent, which further affects sales and revenue.
Because of the cost of forced price increases, production stoppage, is the car companies are the last want to see, in order to alleviate the cost crisis, car companies can only through open source, throttling means, through the purchase of lithium raw materials and waste battery recycling to control costs. Battery manufacturers are also developing batteries from other raw materials to alleviate the shortage of lithium battery supplies.
However, the means of market regulation are always lagging, affected by the current epidemic and regional conflicts, the price of core auto parts may continue to be at a high level, and the various self-help operations of car companies will also take a while to see the dawn. It is believed that with the initiative of various car companies and the emergence of new battery technology, the market price of new energy vehicles will fall in the future, and the new energy automobile industry will return to the track of vigorous development.