Asian companies have invested heavily to gain global dominance in electric vehicle (EV) supply chains. To keep their lead, many EV battery suppliers are increasingly investing abroad. Leading players with strong global partnerships will stay on top amid this industry shift. Some weaker ones in China may not survive.
Asia's top battery players have taken a lot of risks to be global leaders in the EV supply chain. They've built up capacity for a market that has not yet fully arrived. To keep their lead, they now need to shift more investments abroad, even with oversupply in some home markets.
Likewise, Chinese enterprises dominate in the global share of EV battery manufacturing. CATL accounts for 37 percent of the global EV battery market followed by FDB with 16 percent, giving China’s top two competitors alone over half the global market. (See figure 6.)
S&P Global Ratings sees Asian EV battery manufacturers boosting their investments in factories abroad to keep their global lead.
CATL accounts for 37 percent of the global EV battery market followed by FDB with 16 percent, giving China’s top two competitors alone over half the global market. (See figure 6.) The twain are followed by LG Energy and Panasonic, with 14 percent and 6 percent of the market, respectively.
S&P expects China’s domestic EV battery manufacturing to see a “meaningful consolidation” over the next three to five years as weaker companies struggle to stay afloat in a market flooded with supply and crowded with small players.