China is embracing the business philosophy of better quality and lower prices with plans to help its domestic lithium-ion battery industry.
The Vehicle Traction Battery Industrial Development Action Plan sets goals for higher quality and lower costs while meeting the country-wide target of 100GWh of batteries is met by 2020.
It is hoped the action plan will encourage China’s battery manufacturers to expand production scale, and by turn lower costs.
The latest plan also aims to increase technological innovations by calling for more fundamental research efforts and technological developments in the next eight years.
The goals could lead to major market leaders’ buying smaller and low-end manufacturers, at least according to Suzhou-based financial services firm Soochow Securities.
The majority of motive applications are, or are moving toward, using lithium-ion technology.
China has already introduced tougher certification criteria, which effectively slammed the door on non-domestic manufacturers selling batteries in the country.
Last Month BBB reported how pressure was mounting on Chinese battery makers to keep prices stable amid growing material costs.
However, a source in China told BBB recently that lithium technology would not completely replace the lead-acid battery.
The source from a leading lead-acid battery maker in China, said the cost of lithium-ion batteries was still relatively high compared with lead-acid batteries, although the price gap was decreasing.
The source added that the Chinese government was more helpful toward the lithium battery industry with subsidies along with a host of regulations that was making lead-acid manufacturing and recycling harder.