China Still Has a Stranglehold on EV Battery Manufacturing

As the electric vehicle market grows at explosive rates around the world, so does the demand for the batteries that power these vehicles. While the United States and Europe are trying to create their own supply chains for these vital batteries, Asian suppliers, and particularly China, have a dominant command of the battery supply.

According to available statistics, Chinese companies command a dominant 56% of the EV battery production capacity. Korea comes in second at 26%, and Japan completes the top three with a 10 percent share of the worldwide electric vehicle battery market.

At company level, CATL leads all battery manufacturers. In 2021, the company had a market share of 32%. This has since grown to 34% as per the records of 2022. CATL supplies lithium-ion EV batteries to various automakers such as Tesla, Honda, Hyundai, Toyota, BMW, Peugeot, Volvo and Volkswagen. CATL is a Chinese firm.

The second leading maker of EV batteries is Korean firm LG Energy Solution, followed by BYD, a Chinese firm backed by billionaire Warren Buffett. Recent data suggests that BYD is poised to leapfrog LG Energy and become number two among the top battery producers this year. Position number four among battery manufacturers goes to Panasonic, which previously stood at number three but was overtaken by BYD. Panasonic is a Japanese company.

As other manufacturers scramble to claim a bigger share of the electric vehicle battery market, players from Asia are consolidating and growing their positions. Several are even setting up production facilities in the U.S. and other major EV markets in Europe so that they can be nearer to the clients they serve.

It should also be noted that as the world transitions to greener forms of energy, stationary energy storage solutions will also be a big market that battery makers are looking to serve. Players in Asia already have a head start here as well.

As ICE vehicles are shown the exit door and electric vehicles are ushered in, the race for battery manufacturing dominance looks to remain tilted in favor of manufacturers from China and Asia in general. Automakers know the writing is on the wall for conventional vehicles, and some, such as GM and Audi, have announced timelines for ending the production of ICE vehicles. Only time will tell if the efforts of the U.S. federal government and Europe to ramp up domestic EV battery production will yield the desired results of breaking this dependence on China for electric vehicle batteries.

The world is counting on various EV industry players such as Mullen Automotive Inc. (NASDAQ: MULN) to come up with innovative batteries that will deliver electric vehicles to motorists at an affordable cost rather than the current prohibitive prices.

NOTE TO INVESTORS: The latest news and updates relating to Mullen Automotive Inc. (NASDAQ: MULN) are available in the company’s newsroom at https://ibn.fm/MULN

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