Domestic Support for China VS US Alliances for Korea... Intensifying Korea-China Battery Competition

CATL and BYD's Growth Rate Soars
Domestic Top 3 Companies' Market Share Similar to CATL's Share

[Asia Economy Reporter Hwang Yoon-joo] Competition in the electric vehicle battery market is narrowing down to a two-way race between Korea and China. As U.S. automakers form alliances with domestic battery companies to foster their own electric vehicle markets, Chinese battery companies are rapidly expanding their presence with subsidies and tax support from the Chinese government.

According to SNE Research on the 5th, the total energy capacity of electric vehicle batteries registered in vehicles across 80 countries worldwide from January to October this year reached 216.2 GWh, a 116.1% increase compared to the same period last year.

In terms of battery usage rankings, CATL took first place with 67.5 GWh (31.2%), followed by LG Energy Solution and Panasonic in second (45.8 GWh, 21.2%) and third (28.5 GWh, 13.2%) places, respectively. Next were BYD (18.4 GWh, 8.5%), SK On (12.6 GWh, 5.8%), Samsung SDI (10.0 GWh, 4.6%), CALB (6.0 GWh, 2.8%), Guoxuan (4.6 GWh, 2.1%), AESC (3.2 GWh, 1.5%), and SVOLT (2.1 GWh, 1.0%).

As of the cumulative data in October, Chinese companies showed remarkable growth. SVOLT recorded the highest growth rate at 890.2% compared to the same period last year. BYD grew by 196.2%, CATL by 188.0%, CALB by 178.2%, and Guoxuan by 176.9%, with all top five growth rates dominated by Chinese companies. Domestically, SK On showed the highest growth rate at 120.2%, followed by LG Energy Solution and Samsung SDI with 99.4% and 63.6%, respectively.

On the other hand, Japanese companies such as Panasonic, ranked third, showed growth rates far below the market average, resulting in a decline in most of their market shares.

The growth of the three domestic companies was driven by increased sales of models equipped with their batteries. LG Energy Solution benefited positively from strong sales of Tesla Model Y (China-made), Volkswagen ID.4, and Ford Mustang Mach-E. SK On's growth was led by increased sales of Hyundai Ioniq 5, Kia Niro EV, and EV6. Samsung SDI's growth was supported by increased sales of Fiat 500, Audi E-tron EV, and Jeep Wrangler PHEV. However, a sharp decline in Volkswagen e-Golf sales significantly offset the overall increase.

In particular, domestic battery companies are expanding their market share in the U.S. The electric vehicle value chain involving GM, LG Energy Solution, and POSCO Chemical stands out. LG Energy Solution has established a battery joint venture with Stellantis in addition to GM, with disclosed investment plans in the U.S. totaling 150 GWh so far. The goal is to establish a production system of 185 GWh by 2025.

The alliance between Ford and SK On is also dramatic. Although SK On is a latecomer among the three domestic battery companies, it has aggressively invested in the U.S., surpassing Samsung SDI to secure a position among the world's top five battery companies. SK On plans to establish an annual production capacity of 150.5 GWh in the U.S. by as early as 2026 through a joint venture with Ford. An announcement of a European joint venture is also expected early next year.

SNE Research commented, "Despite the significant advances of Chinese companies since 2021, the three domestic companies have maintained a certain growth trend and are performing well," but advised, "They need to employ various strategies such as strengthening foundational competitiveness, securing overseas bases, and expanding business partners."

Meanwhile, global electric vehicle battery usage in October reached 26.2 GWh, a 70.0% increase compared to the same month last year. Despite the COVID-19 pandemic, the electric vehicle battery market has continued to grow for 16 consecutive months. Major markets including China, the U.S., and Europe all saw increases, with many Chinese companies standing out among manufacturers.

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