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The global battery industry will be dominated by China's market value will reach 240 billion US dollars
The global battery industry is experiencing rapid growth, with China emerging as a dominant force. According to Forbes News, there are currently over 140 battery manufacturers in China, and the market value of the global battery industry is expected to reach $240 billion within the next 20 years. As electric vehicles (EVs) continue to gain traction worldwide, the demand for batteries is increasing, making the battery sector a key driver of the new energy economy.
With the rise of EVs, major players like Panasonic, Samsung SDI, LG Chem, Tesla, and BYD have become household names. However, China is quickly catching up and is poised to lead the industry in the coming decades. Analysts from Bernstein Automotive predict that electric vehicles will account for 40% of global car sales in the next two decades. Currently, global EV production and sales have already surpassed 100 million units, indicating strong momentum in the sector.
A single EV battery can cost around $6,000, which contributes significantly to the overall market value. Given the environmental benefits of electric vehicles, China is well-positioned to take the lead in both EVs and battery technology. The country's battery manufacturing capacity has grown rapidly, with China's battery output reaching 125 GWh in recent years and projected to double to 250 GWh by 2020.
To meet the rising demand, global battery production needs to expand significantly. In 2014, Tesla and Panasonic announced plans to build a super factory with an annual capacity of 35 GWh, while the total global battery capacity at the time was less than 50 GWh. This highlights the need for massive investment in battery infrastructure.
Over the past three years, the global battery industry has undergone significant transformation. China has taken the lead, and its battery production capacity is expected to grow tenfold between 2020 and 2037—equivalent to adding 60 new super factories. This shift underscores the growing importance of China in the global battery supply chain.
Battery technology originated in Japan, evolved in South Korea, and is now thriving in China. Chinese battery manufacturers have surpassed Japanese counterparts in terms of production volume and are expected to hold over 70% of the global market share by 2020. This dominance is driven by strong domestic demand, government support, and technological advancements.
China’s EV market is booming, with a growing preference for local brands. According to the Roland Berger E-mobility Index Q2 2017, more than 90% of lithium-ion batteries used in Chinese EVs are made domestically. This trend reflects the country’s commitment to developing a self-sufficient and competitive battery industry.
To further strengthen its position, the Chinese government is considering policies that may set minimum production thresholds for domestic battery companies. Although not yet officially announced, it is speculated that companies will need to produce at least 3–5 GWh annually to qualify for subsidies. In 2016, a draft policy was introduced requiring battery firms to achieve at least 8 GWh of annual capacity to receive government support, signaling a long-term strategy to back large-scale producers.
Among the leading Chinese battery companies, BYD stands out. With a vertically integrated business model, BYD produced over 500,000 vehicles in 2016, including nearly 100,000 pure electric and plug-in hybrid models. Its battery capacity reached 20 GWh, making it one of the largest battery manufacturers in the country. Warren Buffett’s Berkshire Hathaway invested $230 million in BYD in 2008, acquiring a 10% stake, and the company’s current valuation is approximately $16.9 billion.
Another major player is CATL (Contemporary Amperex Technology Co., Limited), established in 2011 and based in Ningde, Fujian. CATL focuses on lithium-ion batteries and energy storage systems, with production facilities in Qinghai, Jiangsu, and Guangdong. The company’s battery capacity is currently around 7.7 GWh, with plans to reach 50 GWh by 2020.
Other notable Chinese battery companies include Tianjin Lishen Battery and Hangzhou Wanxiang Group. Lishen has production bases across multiple cities and is expected to reach 20 GWh of battery capacity by 2020. Wanxiang, the largest private company in China, has expanded globally, acquiring several U.S.-based firms, including A123 and Fisker Automotive.
As the global battery industry continues to evolve, China is playing a central role in shaping its future. With strong domestic demand, government backing, and technological innovation, the country is well on its way to becoming the leader in the global battery market.