The rise of electric vehicles in China cannot be separated from the success of China's car batteries. globalData pointed out in its latest report that China is already a deserved leader in new energy vehicles, with sales of 11.42 million electric vehicles (EVs) and hybrids in 2023, equivalent to 3.5 times that of the runner-up, the United States, which has only 3.35 million units.

According to the report, the global compound annual growth rate of electric vehicle and hybrid vehicle sales from 2023 to 2028 will reach 16.1 per cent, with annual sales reaching 53.9 million units in 2028.

China's growth rate is faster than the rest of the world, the country's total sales of new energy vehicles in 2023 is about 9.5 million units, an increase of 36%, plug-in hybrid vehicle production and sales growth is even faster than amazing, reaching 80%.

Chinese car companies must firmly grasp the battery discourse if they want to maintain and expand their advantage.

Consolidate lithium batteries Develop sodium batteries

Battery electric vehicle (BEV) production is expected to surpass that of hybrid vehicles (HEV) from 2024 to 2028, with China leading the competition because of its scale advantage.

By the numbers, China accounts for 60 per cent of global EV sales, which grew 82 per cent week-on-week in 2022 and are expected to continue to grow over the next few years.

Whoever masters advanced battery technology will get a bigger slice of the pie in the big growth wave. When users purchase an electric car, range is the most important factor to consider. If a BYD car can have a range of 600 miles (about 965 kilometres) and a Tesla car only 400 miles (about 644 kilometres), most car buyers will choose BYD. More buyers will embrace electric cars if their range exceeds that of a petrol or diesel car on a tank of fuel.

Cobalt-free batteries are more affordable, and China's production is far ahead. Lithium iron phosphate batteries are also price friendly and favoured by manufacturers, it has low cost, high cycle life, safety and other characteristics, China is the main producer of lithium iron phosphate batteries.

The price of lithium iron phosphate cars and ICE (internal combustion engine) cars has almost been equal, BEV if you want to completely beat ICE cars in terms of cost-effective, may still have to rely on sodium batteries. Although sodium batteries are less dense, they can be used in combination with lithium iron phosphate batteries.

As sodium battery technology advances, it will become an option for short-range, inexpensive electric vehicles in the future. Looking around the world, only China is planning sodium battery production plants, a total of two, so China in the sodium battery competition and seize the first opportunity.

Winning the Future: China Steals the Show

Chinese electric car makers have formed an alliance, of which BYD is a member, to develop solid-state batteries. Once solid-state batteries become commercially available, the electric car industry will be revolutionised. Many see solid-state batteries as the next stop in the battery evolution because they are lighter, store more energy, charge faster, are safer, and last longer.

Right now solid-state battery cars are still a bit far from commercialisation, with the type of car not expected to be commercially available on a large scale until 2025.

Chen Qingtai, chairman of the China Association of 100 Electric Vehicles, has said in an interview with Japanese media, "China's new energy vehicles have been able to walk in the forefront of the world mainly because of the mastery of advanced battery technology." In the future, China uses this as the basis for its all-out development of solid-state battery technology.

GlobalData pointed out in the report, in the field of light vehicle BEV battery cell parts, China occupies 73% of the global market share, the position of supremacy. Competition in the automotive battery market will intensify in the future, and China's share will decline, but it will still be the leader.

For the moment, large-scale mass production of ceramic and polymer solid-state batteries is still difficult, will soon have companies to put the solid-state battery programme on the table, but its breakthrough may not be as big as the world expected.

The first on the scene will most likely be semi-solid-state batteries, because of its higher energy density, stronger performance, safer, tolerance problems are not so serious, it is entirely possible to take the lead in mass production.