Hanhwa Investment & Securities "Focus on Secondary Battery Companies Related to Tesla Electric Vehicles"

[Asia Economy Reporter Minji Lee] Attention should be paid to companies related to Tesla electric vehicle production among secondary battery material manufacturers. On the 26th, Korea Investment & Securities stated that Tesla is focusing on companies with high energy density materials and presented Ecopro BM as the top preferred stock.

In Tesla's earnings conference call, it was mentioned that nickel-based lithium-ion batteries are suitable for models that require minimizing the size of secondary batteries. Jeonghwan Kim, a researcher at Korea Investment & Securities, said, "Considering that the current driving range target for next-generation secondary batteries is around 500 to 800 miles, the core goal of secondary battery performance development can be inferred as equipping high-nickel secondary batteries or achieving high energy density to increase driving range."

Ecopro BM is a secondary battery material company producing high-nickel cathode materials. The core direction of Tesla's secondary battery technology development is to increase the nickel content and introduce silicon anode materials to extend driving range. They also plan to reduce cobalt content to lower costs. Researcher Kim explained, "The high-nickel cathode materials produced by Ecopro BM meet all of Tesla's criteria."

Tesla's Berlin Gigafactory, which started production in 2021, sources secondary batteries locally. It is highly likely that secondary battery companies LG Chem and Samsung SDI will supply these batteries. These companies produce cylindrical secondary batteries and have manufacturing plants in Europe. SK Innovation and Northvolt do not produce cylindrical or prismatic secondary batteries, and CATL's European plant is expected to start production no earlier than 2022.

LG Chem announced that it will convert part of its domestic production line to supply Tesla. This is because Tesla's secondary battery demand has increased beyond previous expectations, and the existing lines cannot increase production further. Researcher Kim said, "Assuming the 2021 electric vehicle production capacity of the China Gigafactory is 350,000 units and LG Chem's market share is 60%, the production capacity required for Tesla is 15GWh. The company will proceed with additional expansion," and predicted, "The profitability of the small secondary battery business will improve going forward."

This content was produced with the assistance of AI translation services.