The 5.7 billion yuan battery project landed 10 battery factories in Nanjing

Recently, LG New Energy, a global power battery giant, has once again increased its investment in China. It is reported that Jiangning Binjiang Development Zone signed a contract with LG New Energy, with a total investment of about 800 million US dollars (about 5.77 billion yuan), mainly involving power batteries, energy storage batteries and other production projects.

According to the data, as early as August 2018, LG New Energy officially settled in Jiangning Binjiang Development Zone, with a total investment of 3.3 billion US dollars, mainly engaged in the production and sales of new energy vehicle power batteries and energy storage batteries, focusing on providing new energy batteries for Volkswagen and other enterprises.

In 2023, Jiangning Binjiang Development Zone will sign a new project with LG New Energy - LG New Energy General Motors Project, which mainly produces exclusive power batteries for General Motors, and is expected to increase annual sales (output value) of about 4 billion yuan after full production.

Kim Dong-myung, CEO of LG Energy Solution, said that LG Energy Solution Group's investment in Binjiang is currently the most advanced factory of the group, with the highest yield and efficiency, and the group will continue to increase investment in the Nanjing Jiangning Binjiang project in the future.

—1—Planned 145GWh production capacity in China

It is reported that LG Energy Solution has three battery factories in Nanjing, with a total battery production capacity of 62GWh. LG Energy Solution has said it plans to expand the capacity of its Nanjing plant from 62GWh to 145GWh by 2025.

According to LG Energy Solution's previous plan, the global battery production capacity is planned to be 520GWh by 2025, of which 145GWh is in China, which is the largest battery factory outside North America.

It can be seen that in response to the pressure of global market competition, especially from rival CATL, LG Energy Solution has been looking for opportunities to expand its production capacity around the world in recent years, and the Binjiang Development Zone project may help it release more battery production capacity in the future.

In 2023, CATL's installed power battery capacity of 259.7GWh ranked first in the world, BYD's installed capacity of 111.4GWh ranked second, and LG New Energy's installed capacity of 95.8GWh was surpassed by BYD and dropped to third place.

Entering 2024, LG Energy Solution will still rank third among the top 10 global power battery installed capacity in January.

In the domestic market, LG New Energy's share is being eroded step by step by second-tier power battery factories. The top 10 companies in terms of installed power battery capacity in January 2024 are: CATL, BYD, China Innovation Airlines, Guoxuan Hi-Tech, Honeycomb Energy, EVE Lithium Energy, Xinwangda, LG New Energy, Ruipu Lanjun, and Funeng Technology.

The main reason behind this is that the domestic market favors lithium iron phosphate batteries more, and the cooperation between its major customer Tesla and CATL has further squeezed the market of LG New Energy, in addition, LG New Energy Lithium Iron Phosphate batteries for power are still being developed and promoted, and it is expected to be mass-produced in 2025.

In addition, LG Energy Solution continues to cooperate with leading enterprises in the domestic industrial chain to improve the layout of its own industrial chain.

Recently, Changzhou Lithium Source and LG New Energy recently signed an order for 160,000 tons of lithium iron phosphate cathode materials. LG Energy Solution pointed out that the above cathode materials can be used to produce power batteries for 1 million electric vehicles with a range of more than 400 kilometers.

In August last year, LG Energy Solution joined hands with Huayou Cobalt to deploy battery recycling business in China. The two companies plan to build two battery recycling plants in Nanjing and Quzhou. Among them, the pretreatment plant will be built in Nanjing, and the posttreatment plant will be built in Quzhou.

After the battery recycling plant is put into operation at the end of 2024, the battery waste generated at LG Energy Solution's Nanjing plant and the waste batteries collected by Huayou Recycling will be delivered to the joint venture company to produce recycled metals including nickel, cobalt and lithium, which will be processed and supplied to LG Energy Solution Nanjing plant.

—2-10 battery factories settled in Nanjing

In recent years, focusing on building a new energy vehicle industry cluster, Nanjing has focused on introducing new energy vehicle leading projects and core parts projects. At present, a number of top 10 global power battery companies in terms of total installed capacity, including LG New Energy and Guoxuan Hi-Tech, have been completed and put into operation in Nanjing, and the cumulative power battery production capacity and annual total installed power battery capacity are among the top in the country.

In terms of Gotion Hi-Tech, from the first "hand-in-hand" Liuhe in 2015 to the continuous capital increase of nearly 10 billion yuan in the following nearly ten years, Gotion Hi-Tech has become more and more deeply rooted in Nanjing.

It is reported that at present, Nanjing Guoxuan has built 3 factories in Liuhe, completed the production capacity layout of 28GWh, and will move towards the goal of an annual output value of 15 billion yuan this year.

Among them, the Gotion New Energy Intelligent Manufacturing Project is the first investment project after the in-depth cooperation between Gotion Hi-Tech and Volkswagen of Germany, which has become one of the largest production bases of Gotion in China, and its products are supported by Geely, Changan and other automobile manufacturers.

In terms of Sunwoda, with a total investment of 13.5 billion yuan, Nanjing Sunwoda project is the first power battery production base of Sunwoda in East China, mainly producing lithium-ion battery cells, modules and battery packs, etc., and is committed to building a world-class HEV power battery and fast charging system production base.

The project will be constructed in three phases, with a total production capacity of 30GWh. At present, the first and second phases have been put into operation. At present, Renault, Dongfeng, Geely and other hot new energy models in the market are equipped with Sunwoda power batteries.

In terms of SVOLT Energy, in 2021, the company invested 5.6 billion yuan to build a power battery production base with a total production capacity of 14.6GWh in Lishui, Nanjing. At present, it supplies to Geely, Great Wall, Dongfeng and other OEMs.

In terms of China-Belgium New Energy, it is understood that the second phase of the China-Belgium Nanjing project currently plans a production capacity of 18GWh, which will be completed in three stages, and the second and third phases will be completed in 2026 and 2028 respectively, combined with the current Nanjing Phase I project, the Nanjing base of China-Belgium New Energy will form a total production capacity of 20GWh in the future.

In addition, on January 21 this year, the groundbreaking ceremony of the battery and new energy power technology plant project of SAIC Passenger Vehicle Nanjing Base was held. After the completion of the first phase of the project, it will have an annual production capacity of more than 240,000 sets of batteries, and the installed capacity is expected to reach more than 10-13GWh, which will be used for a variety of pure electric and hybrid models on the new energy vehicle platform.

Aiming at the power battery, a new energy vehicle subdivision track, Nanjing is constantly strengthening its cluster advantages.

According to the data, at present, 10 power battery enterprises in Nanjing have been put into production, including LG New Energy (Aierji), Guoxuan, Xinwangda, Honeycomb and other industry leaders, with a completed production capacity of 120.82GWh. From January to September 2023, the output value of the city's 10 power battery companies reached 70.62 billion yuan, a year-on-year increase of 13.9%.

The "Nanjing Action Plan for Building a New Energy Vehicle Industry Cluster" points out that by 2025, the annual output of new energy vehicle power batteries will exceed 300GWh, cultivate 1 power battery enterprise with a main business income of more than 50 billion yuan, and more than 4 power battery enterprises with a total of more than 10 billion yuan, and the R&D and manufacturing of power batteries and management systems, fuel cells, and solid-state batteries will reach the international leading level.