China’s battery industry is advancing towards solid-state battery technology for electric vehicles (EVs) at varying speeds. Established manufacturers are moving cautiously, while startups are diving in more aggressively [para. 1]. IM Motors, backed by Alibaba, claims its L6 sedan, launched recently, as the first car with ultra-fast charging solid-state cells, grabbing market attention [para. 2].
A startup, QingTao Energy, along with China’s auto giant SAIC Motor, aims to sell 100,000 solid-state battery-equipped EVs by 2025. SAIC will invest up to 2.7 billion yuan ($373.7 million) in QingTao, becoming the startup’s second-largest shareholder [para. 3]. Beijing WeLion New Energy Technology, another key player, delivered semi-solid state batteries to Nio, reportedly offering higher energy density [para. 4].
Japanese automaker Toyota plans to mass-produce solid-state batteries by 2027, pushing QingTao Energy and other Chinese companies to expedite their development efforts [para. 5]. The potential of solid-state batteries lies in longer driving ranges and enhanced safety compared to current lithium-ion batteries [para. 7]. However, major battery manufacturers like CATL and BYD are adopting a gradual approach, awaiting cost reductions and resolution of technical challenges [para. 8].
CATL plans to start small-scale solid-state battery production in 2027, marking its first public declaration on the matter, while BYD remains secretive [para. 9]. Despite the name, many so-called solid-state batteries currently in development are semi-solid, incorporating 5% to 10% liquid electrolytes [para. 11]. These variants offer slightly higher energy density compared to traditional lithium-ion batteries, but achieving the full promise of solid-state technology remains a distant goal [para. 13].
Cost is a significant barrier, with semi-solid-state batteries costing twice as much as lithium-ion ones [para. 14]. Investors worry that the high costs may limit solid-state batteries to luxury EVs or specific use cases, representing only a small portion of market demand [para. 15]. To mitigate costs and attract customers, startups are scaling up production capacity. QingTao Energy and WeLion are expanding their factories with significant investments, aiming for mass production and cost competitiveness by 2025 [para. 16][para. 21].
Established battery giants like CATL and BYD are hesitating to plunge deeply into solid-state batteries. They focus more on short-term, economically viable technologies like lithium-manganese-iron-phosphate batteries [para. 27]. Both companies have established R&D institutions focusing on one, three, and five-year technological horizons but allocate the majority of their resources to near-term technologies [para. 30].
Stock performance and market conditions further influence their cautious stance. CATL and BYD are wary of investing heavily in challenging technologies amidst a backdrop of market overcapacity and share price declines [para. 33]. Regulatory measures also play a role; China’s Ministry of Industry and Information Technology has proposed new standards for the lithium battery sector to curb overexpansion and ensure quality [para. 34].
Ultimately, while startups are betting on rapid expansion and solid-state battery adoption, larger players like CATL and BYD remain cautious, focusing on achievable advancements. Despite their slow start, the giants could quickly catch up if solid-state battery technology proves commercially viable [para. 38].
AI generated, for reference only
