After the spin-off of the power lithium battery business, BYD's strength has decreased
After losing the halo of the former power battery leader, BYD set its sights on the Ningde era and began to speed up the pace of spin-off of the power battery business, and its external sales of power batteries also far exceeded expectations.
Supply Dongfeng Motor takes the first step in the self-selling system
A few days ago, the Ministry of Industry and Information Technology announced the declaration of the 307th batch of "Road Motor Vehicle Manufacturing Enterprises and Products Announcement" new products. A total of 429 new energy vehicle products have been declared by 123 enterprises, and the number has increased significantly. Among them, there are 181 new energy passenger vehicles, accounting for 42.19%; 58 new energy passenger vehicles, accounting for 13.52%; and 190 new energy special vehicles, accounting for 44.29%.
When reviewing the product announcements, it was found that among the new energy special-purpose vehicle products in this batch, a pure electric truck chassis and pure electric van truck declared by Dongfeng Motor Group were equipped with lithium iron phosphate batteries provided by BYD.
Obviously, unlike outside rumors, Dongfeng Motor Group Co., Ltd. seems to be the first car company to "eat crabs".
The publicity list shows that Dongfeng Motor Group Co., Ltd.'s EQ5045XXYTBEV29 pure electric van and EQ1045TTEVJ29 pure electric truck chassis use lithium iron phosphate batteries produced by Shenzhen BYD Lithium Battery Co., Ltd. Dongfeng new energy vehicle power batteries are mostly CATL, Guoneng, Lishen and BAK, etc. This is the first time that Dongfeng has used BYD power batteries, and it is also the first time that BYD power batteries have been installed externally.
In the field of electric vehicles, it has always adopted the development model of vertical integration and self-use. Last year, BYD's new energy passenger vehicles sold a total of 113,669 units, accounting for 13% of the global new energy market. It is a well-deserved "new energy vehicle leader". However, the self-produced and self-sold vertical integration model allowed BYD's power battery sales to be overtaken by CATL last year, which far surpassed BYD's 7.2GWh with a sales volume of 12GWh.
Since BYD was surpassed and relegated to the second place in the industry, the Ningde era, which has risen like a rocket, has made BYD begin to re-examine its self-produced and self-sold power battery system. In response to declining subsidies and intensified market competition, BYD plans to spin off its battery business, break the closed system, and plan to supply externally.
In fact, BYD began to try to break through the shackles of self-production and self-selling in the power battery business as early as last year.
BYD said that after the marketization of parts including batteries and other components last year, it began to negotiate with many vehicle manufacturers, and it is still under discussion, and a series of cooperation will be reached in the future. The company has already docked with major auto OEMs such as Great Wall, BAIC, and GAC on the power battery business, and it is expected that some batteries will be sold as soon as this year.
Digest the huge production capacity to make rivals become customers
The move to split the power battery business not only means that BYD will break the original vertical integration of production and operation, but also means that BYD will supply power battery modules with core technologies to the entire new energy vehicle market, in other words, BYD's previous competitors. Automakers will become BYD battery customers.
It is not so much a top-down change as it is forced by external circumstances. Due to changes in the subsidy policy of the new energy vehicle market in 2017, BYD's new energy vehicle sales declined significantly in the first quarter of last year. In the first quarter of last year, BYD's new energy vehicle sales fell to 8,719 units, a drop of nearly 50 percent, according to data from the Passenger Federation. At the same time, BYD's domestic power battery supply also fell to the second place due to a year-on-year decline of 63.9%.
On the other hand, BYD's new energy vehicles are far from being able to eat its own huge power battery production capacity.
It is understood that BYD has two battery factories in Shenzhen, the largest of which can achieve an annual battery production capacity of 1 billion watt-hours. This means that the annual battery output of the battery factory can meet the demand for power batteries for 25,000 buses and 600,000 plug-in hybrid electric family cars. BYD's second factory also has an annual production capacity of up to 8 million kWh of lithium iron phosphate batteries.
In addition to the above two construction projects, the new battery factory BYD is investing in and building in Qinghai will form an annual production capacity of 10GWh of power batteries. According to BYD insiders, as the expansion has been carried out ahead of schedule, BYD's power battery production capacity has been expanded to 14GWh this year. If Lenovo's sales volume of 720 million GWh last year, its capacity utilization rate is just half, and battery export sales have become an inevitable choice.
According to the previous government plan, as of 2020, the cost of the power battery system will be reduced to less than 1 yuan, and the entire power battery industry will start a war to reduce costs.
When it is difficult to make great progress in the sales of new energy vehicles, the cost sharing of power batteries is limited, and under the pressure of huge labor costs, BYD is under huge financial and operational pressure. The closed vertical integration system of a single company before has increasingly become a stumbling block for BYD's progress.
Going out can win a new life. Now BYD has won the first single battery business of Dongfeng Motor Group. Once the power battery business is split, it will inevitably connect to more vehicle manufacturers in the future. Turning an opponent into a customer may become BYD's next trump card against the Ningde era.
