Incoming Blade Battery: BYD PK Ningde Winning Geometry?

BYD, the second largest power battery supplier in China, is launching a counterattack against the industry's hegemonic Ningde era.

In June 1st, the Ministry of industry website showed that a plug-in hybrid vehicle announced by Ford Changan will carry the power battery produced by BYD subsidiary Xi'an Zhong Di Lithium Battery Co., Ltd.

This is the first time that BYD has supplied batteries to a mainstream multinational car company in China. The company, which originally relies on battery strength, has led the new energy vehicle market in China, and has gained new profit margins by supplying its core power battery technology to the outside world.

The biggest competitor of BYD power battery is Ningde era (300750.SZ). The most valuable company in China's automobile industry is almost two BYD.

The horn of competition has blown up. Not long ago, because of the "battle of words" triggered by acupuncture tests, the two companies fought against each other. The trigger for the two sides' lip service is BYD's attempt to pry the power battery market, the blade battery.

BYD regards "high security" as the main selling point of blade batteries, and hopes to open up battery supply channels for other car companies by virtue of this advantage. "Many car companies are discussing with us about blade battery cooperation, of course, including some foreign companies." In June 3rd, Li Yunfei, deputy general manager of BYD automobile sales, said at the BYD battery factory in Chongqing, which was interviewed by the twenty-first Century economic report.

However, there is a clear gap between the blade battery and the three yuan lithium battery in terms of energy density. The core of BYD and the first round of PK in the Ningde era is actually the competition between the two companies.

Safety PK endurance?

In March 29th, BYD released the "needle test" video of blade batteries smoothly at the "blade battery" press conference. "The battery needle test is like the difficulty of climbing Mount Qomolangma." At that time, He Long, vice president of BYD shares and chairman of Freddie battery, described so as to promote the high safety of blade batteries.

The acupuncture test also triggered a fierce confrontation between BYD and Ningde in the past when you came to me, "apart from each other" and "who is safer".

In June 3rd, twenty-first Century economic report reporter saw at BYD factory in Chongqing, under the same test conditions, a brand of three yuan lithium battery on the market was burning rapidly and exploded. After BYD needle battery was acupuncture, there was no obvious change, no bright fire and no smoke, and the surface temperature was always at 30-60 degrees Celsius.

Through comparative tests, BYD explains that blade battery is safer than three yuan lithium battery. However, there are different views in the Ningde era.

In the Ningde era, the safety of batteries runs through the whole process of battery use, which is a systematic project, including battery monomer design, system integration, dynamic monitoring and system protection. Therefore, the Ningde era has focused on the overall safety of batteries.

"Technically, there is a more secure solution to the battery pack level, and the actual demand for single cell needle testing is no longer there." The Ningde era said.

Battery industry experts told the twenty-first Century business reporter that the thermal stability of lithium iron phosphate battery is obviously higher than that of three yuan lithium battery, and the three yuan lithium battery is more difficult through the needling test, but this does not prove that the three yuan lithium battery is unsafe.

There are obvious contradictions between the two power lines of the power battery: the thermal stability of the lithium iron phosphate battery is higher than that of the three yuan lithium battery, but the energy density and the endurance of the three yuan lithium battery are higher.

Safety accident is a fatal hidden danger for the development of new energy vehicles, and the essence of new energy safety accidents is battery thermal runaway.

"At 500 degree temperature, the structure of lithium iron phosphate is very stable, but three yuan lithium material will decompose at about 200 degrees Celsius, and the chemical reaction is more intense, it will release oxygen molecules, more likely to lead to heat runaway." In June 3rd, Sun Huajun, deputy general manager of VD battery company, told reporters on twenty-first Century economic report.

With the progress of technology and the adjustment of the subsidy policy to the mileage of the mileage, high energy density has become the focus of the industry's pursuit. This also makes the three yuan lithium battery more popular in the market. It is worth noting that even in BYD, most cars in the field of passenger cars also carry three yuan lithium batteries.

However, in recent years, the spontaneous combustion of new energy vehicles has been frequent, which has sounded the alarm for the industry, and has also added obstacles to the development of new energy vehicles.

According to public information, there were at least 5 electric vehicle fire accidents in Guangdong and Hunan in May this year, involving ideal cars, Zhengzhou Nissan, GAC new energy Aion S, SAIC Iveco electric van and BYD Qin Pro EV. Among them, the Iveco electric vehicle fire accident in Shenzhen caused the driver to escape in time and die instantly.

In recent years, the number of electric vehicles carrying three yuan lithium battery fires is much higher than that of lithium iron phosphate batteries.

"It is the unrealistic pursuit of battery energy density, completely biased the development trend of the power battery industry, and made the new energy passenger car's word of mouth very costly." Wang Chuanfu, chairman of BYD, bluntly pointed out that the blade battery is correcting technology.

However, some people in the industry believe that high endurance is still an important factor for consumers to buy cars. In the short term, the mainstream market position of three yuan lithium battery is difficult to change.

"From the perspective of energy density, lithium iron phosphate batteries always have limitations. BYD Han EV can achieve 600 km level, has been very good. However, from the perspective of the development of electric vehicles, consumers prefer to buy cars with higher mileage by instinctive habit. Auto industry insiders told reporters on twenty-first Century economic report.

Hidden dangers of capacity expansion

It is understood that BYD's production of blade battery Chongqing plant started operation in March this year, it is expected that by the end of this year there will be 8 production lines, the factory's capacity after production can reach 20Gwh.

According to BYD's battery planning, BYD's power battery company has set up production base in Shenzhen, Xi'an, Qinghai, Chongqing, Changsha and Guiyang. By the end of 2019, BYD has built a battery capacity of 40Gwh, and the battery capacity will reach 65Gwh this year, and it will reach 100Gwh by 2022.

However, in 2019, BYD power battery loading capacity was only 10.75Gwh. That is to say, at present, BYD's battery capacity is obviously underutilized.

Li Yunfei told the twenty-first Century business reporter that the existing capacity planning is to prepare ahead for the future supply of batteries, and that the scale of China's new energy vehicle market will have room for growth in the future.

The Ningde era is also expanding its capacity. By the end of 2019, the power battery capacity of Ningde era was 53Gwh, and the capacity of the announced construction projects has been 22Gwh. In 2019, the power battery load in Ningde was 31.46Gwh.

Before 2016, BYD had been the champion of China's power battery market. Since 2017, the Ningde era has gone against the superpower and has gradually opened up the gap with BYD. The key to BYD's narrowing the gap lies in the scale of battery outsourcing.

In addition to cooperation with Changan Ford, BYD has already reached a partnership with TOYOTA, but the product has not yet landed. In addition, Daimler's joint venture with BYD is BYD's battery. However, Mercedes Benz brand's first pure electric vehicle EQC in Europe is equipped with LG chemical batteries, and in China is equipped with the Ningde era battery.

However, a major reason for the impact of BYD's outsourcing is that the car companies will measure the risks associated with the use of batteries produced by competitors.

For car companies, the risk tolerance capability of the supply chain is very important. In the field of electric vehicles, the most important thing is the stability of battery supply. The strategy of car companies to maintain supply chain stability usually includes: co operating with several battery factories; establishing joint ventures with battery factories; for example, a number of mainstream car companies in China and a joint venture in Ningde era; and investing in battery companies. Recently, Volkswagen has become the largest shareholder of the company with Euro 1 billion 100 million as its largest shareholder to ensure the stable supply chain of the Volkswagen joint venture in China.

In addition, Japan and Korea power battery enterprises in the Chinese market to speed up construction and expansion of production capacity, will also have a direct impact on the Ningde era and BYD.

In addition to the expansion of the liberalization, BYD battery separation business is also concerned by the industry, BYD has repeatedly clarified the IPO plan of the battery business.

A number of BYD insiders told the twenty-first Century business news reporter that the BYD battery division plan is now advancing according to the established plan. From the current progress, the battery business IPO may be slower than the semiconductor business.