my country's new energy vehicle market entered a period of explosive growth in 2014. Based on the 4-6 year lifespan of passenger vehicle batteries, the power batteries used in passenger vehicles produced in 2014 will begin to enter their end-of-life phase this year. Furthermore, commercial vehicle power batteries, which experienced two consecutive years of rapid growth in 2014 and 2015 and have a high initial base, will also enter their end-of-life phase this year. Since commercial vehicles use higher-capacity batteries, their end-of-life volume is expected to be more substantial than that of passenger vehicles. According to expert estimates, the market for recycling power batteries into cathode material precursors reached 1.7 billion yuan in 2018 and is expected to reach 20.5 billion yuan by 2023, representing a compound annual growth rate of 65%. Although the current recycling market is relatively small due to the low initial base, the power battery recycling market will gradually explode as the new energy vehicle market continues its high growth. However, compared to the explosive growth trend of new energy vehicles, the power battery recycling industry is also facing new challenges. Relatively outdated recycling strategies are making the entire power battery recycling market precarious.
From July to September 2018, the postgraduate summer professional practice team of the School of Automotive and Mechanical Engineering of Changsha University of Science and Technology conducted a two-month survey on the development status of new energy vehicle power batteries in Hunan Province. The team visited Xiangtan Sandon New Energy Technology Co., Ltd., Zhuzhou Branch of Beijing Automotive Industry Corporation, and the Changsha New Energy Vehicle Promotion and Application Base, among other places, to conduct research activities. They also conducted a large-scale questionnaire survey among Changsha residents. The team carried out a comprehensive survey and analysis of the entire process from power batteries to recycling, and found that the entire new energy vehicle industry still faces decisive factors that seriously restrict the development of the recycling industry.
The lack of standards for power battery cells
There are hundreds of different cell models for current power batteries, and it's common for the same vehicle model to use power batteries from different manufacturers. However, battery dismantling is a key process in the recycling industry chain. Whether it's wet or dry recycling, dismantling of used batteries is essential. The biggest guarantee of dismantling capability is the standardization of retired batteries. Only when a standard is established can dismantling be streamlined, significantly reducing costs. However, experts from the China Automotive Technology and Research Center (CATARC) point out that cell standardization is difficult to promote because major companies have their own technological barriers and product advantages; standardization would inevitably affect their profitability. Secondly, battery standardization is also a necessary prerequisite in the fast-swapping industry. Only when major manufacturers produce standardized cells can the government build basic battery swapping stations and improve the supporting infrastructure for new energy vehicles. Based on these two points, battery standardization is one of the key factors hindering the industry's development. However, the government could consider promoting the standardization of battery packs and the standardization of the inner membrane assembly of the battery pack.
The current new energy vehicle market is developing abnormally.
The current development of the new energy vehicle market is highly distorted. my country is currently a large country in the new energy vehicle market, but not a strong one. This distortion can be attributed to three main aspects. First, there is the distortion in technological development. Normally, the development of new energy technology should progress gradually from hybrid technology to plug-in hybrid technology and then to pure electric technology. However, my country skipped hybrid technology, resulting in a significant gap in battery technology compared to developed countries. Current development largely relies on government investment in technology. Second, there is the distortion in demand. For families wanting to buy a car, A0-class sedans do not meet their normal needs. Currently, most A0-class cars are purchased simply because of government subsidies, leading to many manufacturers engaging in subsidy fraud. Many new energy vehicle manufacturers are newcomers to the field, producing new energy vehicles without sufficient technological accumulation, resulting in low vehicle safety and reliability. Third, there is the frequent amendment and imperfection of laws. New energy vehicles need to obtain three documents—announcement (birth certificate), a recommended list, and a tax-exempt list—from production to official sale, a lengthy approval process. However, relevant national policies have changed annually in recent years, resulting in a mismatch between policies and vehicle availability, severely hindering the industry's further development. Therefore, my country's current new energy vehicle market is in a distorted state where subsidies come first, while technological development and legal systems lag behind.
Recycling technology is relatively lagging behind.
Existing recycling technologies generally suffer from low recycling rates and high costs, which inevitably hinders the development of the recycling industry. Both wet and dry recycling methods have limited capacity. Secondly, the lack of standardization in recycling channels is another reason for the industry's stagnation. Currently, the recycling of power lithium batteries mainly relies on small recycling workshops, with few professional recycling companies and government recycling centers. Currently, many unqualified refurbishing workshops have entered my country's power battery recycling market. These companies use outdated equipment and processes, but if they were handed over to legally registered and tax-paying companies that obtained qualifications and adhered to national standards, they would inevitably lose price competitiveness. Therefore, it is essential to further improve policies to ensure the sustainable development of the battery recycling industry and to build standardized recycling channels.
