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中文Doubled in Six Months, Nearing 150,000 Yuan per Ton! Behind the Soaring Lithium Prices, the Battery Industry Is Transforming
Tuesday, 13 January 2026
At the beginning of 2026, lithium carbonate futures once again captured attention with a sustained price surge. On January 9, the main contract for lithium carbonate closed at 143,420 yuan per ton, accumulating an increase of over 120% from the low of 59,900 yuan per ton on June 5, 2025, marking a new high since November 2023.
This price, approaching the 150,000 yuan per ton mark, has become the most notable “price anchor” in the new energy industry chain, directly impacting both upstream and downstream sectors.
Short-Term Supply Shortage and Full-Throttle Demand Drive Lithium Prices Upward
“The demand from 2025 to now can be described as full throttle: new energy vehicle sales have grown by over 30% year-on-year, power battery installations have increased by more than 40%, and the energy storage market has become an absolute dark horse, with domestic project bidding volumes doubling and overseas orders surging simultaneously. Its production share is catching up to that of power batteries, and leading companies have already filled their order books into 2026,” remarked a capital market analyst regarding the driving factors behind this round of lithium carbonate price increases.
In the view of one industry insider, a mismatch between supply and demand has further intensified short-term supply tightness. “On January 4 this year, the State Council issued a document proposing, in principle, no further approvals for mineral processing projects without self-owned mines or supporting tailings utilization and disposal facilities. Key expansion projects such as Ganfeng Lithium’s Cauchari-Olaroz salt lake lithium extraction project in Argentina and Tianqi Lithium’s second-phase project in Suining, Sichuan, are still ramping up and are unable to contribute significant supply in the short term. Additionally, concentrated maintenance at lithium iron phosphate (LFP) enterprises before the Chinese New Year led to production reductions.”
Furthermore, the “Solid Waste Comprehensive Management Action Plan” released by the State Council on December 27, 2025, added another layer of policy constraints on industry costs, potentially further raising operational expenses for companies in the near term. On January 7 this year, four ministries including the Ministry of Industry and Information Technology (MIIT) jointly held a symposium to address irrational competition in the lithium battery industry, explicitly emphasizing strict control over redundant construction and curbing low-price dumping. This policy direction has shifted market expectations regarding industry overcapacity, further fueling the rise in lithium prices.
Rising Raw Material Prices Prompt Top Battery Firms to Lock in Costs with Long-Term Agreements
In response to rising raw material prices, battery manufacturers are taking various countermeasures. Some leading companies have already announced price adjustments. For instance, Suzhou Dejia Energy Technology Co., Ltd. recently announced a 15% price increase for its battery product series.
More importantly, a supply chain restructuring centered on “long-term agreements” is unfolding, making the differentiation within the battery industry chain increasingly pronounced. Leading companies, leveraging their scale advantages and supply chain control, are building competitive moats by signing long-term agreements with price linkage clauses to lock in costs.
Current long-term contracts in the industry generally move away from rigid fixed-price models, adopting dynamic pricing mechanisms such as “linked to the SMM index + cost range,” allowing price fluctuations of 10% to 15%, and incorporating flexible volume adjustment clauses to cope with market volatility.
An industry insider gave examples: The supplementary agreement between Longpan Technology and Chuneng New Energy stipulates total sales exceeding 45 billion yuan from 2025 to 2030, while Tianci Materials has committed to supplying 725,000 tons of electrolyte to CALB from 2026 to 2028. Such large-scale long-term agreements typically include technology binding and price linkage clauses.
Difficulty Entering Core Supply Chains Accelerates Shakeout of Smaller Battery Firms
An industry analyst pointed out that this deep binding model ensures resource supply for leading battery companies while excluding second- and third-tier battery manufacturers from core supply chains, signaling an impending new round of industry consolidation.
“Medium to long term, the massive demand from the global new energy vehicle and energy storage markets will accelerate the exit of low-quality capacity, driving resources and orders to concentrate among leading and vertically integrated enterprises,” the analyst noted. “The proportion of profitable enterprises in the LFP sector is only 16.7%, significantly lower than other core lithium battery materials like ternary cathode and anode materials. From 2023 to Q3 2025, five listed LFP companies accumulated losses exceeding 10.9 billion yuan.”
In 2025, the CR10 (combined market share of the top ten companies) in China’s battery industry increased from 65% to 75%, with leading firms expanding their market share through mergers and acquisitions. Small and medium-sized manufacturers with annual production capacity below 5 GWh are being phased out at an accelerated pace, while the CR5 of leading companies surpassed 50%.
Recently, Salt Lake Co., Ltd. disclosed an asset acquisition plan, proposing to acquire a 51% stake in Wukuang Salt Lake from its controlling shareholder, China Salt Lake, for 4.605 billion yuan in cash. A week earlier, Chengxin Lithium Group announced plans to acquire a 30% stake in Qicheng Mining through its wholly-owned subsidiary for 2.08 billion yuan in cash. These M&A activities indicate that lithium mineral resources are once again becoming highly sought after.
“This is not a short-term speculative-driven trend, but a systematic value reassessment based on genuine supply and demand, cost structures, and industry influence,” commented one industry insider. “Companies possessing resource barriers, technological depth, production discipline, and customer loyalty are transitioning from ‘price takers’ to ‘rule co-creators.'”
Sodium-Ion Battery Substitution Heats Up in Mid-to-Low-End Energy Storage and Light-Duty Power Applications
Soaring lithium prices are also acting as a “catalyst” for technological iteration, driving the battery industry toward diversification. In mid-to-low-end energy storage and light-duty power applications, sodium-ion batteries, leveraging their “lithium-free” advantage, have achieved mass production, becoming an important alternative to LFP batteries.
Compared to lithium batteries, sodium-ion batteries offer stable material costs, as sodium accounts for 2.3% of the Earth’s crust, and its extraction cost is only 1/20th that of lithium. The cost of cathode material (copper iron manganese oxide) for sodium-ion batteries is 35% lower than that of LFP, and anode material (hard carbon) cost is 40% lower. Additionally, sodium-ion batteries exhibit excellent low-temperature performance, maintaining over 90% capacity at -20°C, perfectly suiting application scenarios like energy storage in extremely cold regions.
Looking back at 2025, investment enthusiasm in the sodium-ion battery sector already surpassed that in solid-state batteries. According to incomplete industry statistics, 28 announced projects with disclosed investment amounts totaled approximately 61.5 billion yuan. Among these, three projects involved investments over 5 billion yuan, and 18 projects had investments exceeding 1 billion yuan. Southwest and East China emerged as primary hubs, planning capacities of 81 GWh and 78 GWh, respectively.
Entering 2026, sodium-ion batteries have reached the critical stage of “capacity ramp-up and market validation.” CATL’s sodium-ion batteries have been installed in batches in models from Chery and Jianghuai, and are penetrating the residential energy storage sector. Penghui Energy’s sodium-ion battery shipments are steadily increasing in the residential energy storage and portable power market. HiNa Battery, leveraging its GWh-level capacity, is solidifying its technological advantage in regional energy storage projects.
Solid-State Battery Development Accelerates; Industry Expects Mass Production Around 2030
It is noteworthy that solid-state batteries, once highly anticipated for their “lithium-free” potential, actually exhibit increased lithium dependency. Industry data shows that lithium usage in solid-state batteries across different technological pathways significantly exceeds that of LFP batteries: sulfide/oxide solid-state batteries require approximately 850 tons of lithium carbonate equivalent (LCE) per GWh, 1.5 times that of LFP batteries (567 tons/GWh); semi-solid-state lithium metal batteries use 1,088 tons LCE/GWh, 1.8 times that of LFP; and all-solid-state lithium metal batteries require up to 1,906 tons LCE/GWh, 3.4 times that of LFP.
Regarding commercialization progress, Qingtao Energy achieved trial production for its solid-state battery-specific materials project in July 2025, with a total planned capacity of 65 GWh, and has established deep partnerships with automakers like SAIC and GAC. Weilan New Energy’s second-generation semi-solid-state batteries achieved mass production in 2025, with plans for all-solid-state battery small-batch installation in vehicles by 2027.
In contrast, early-stage R&D-focused battery companies face greater fundraising difficulties, as capital increasingly favors projects with mature technology and proven production capabilities, making the industry’s “Matthew Effect” more pronounced.
According to industry experts, mass production of solid-state battery technology is expected around 2030. Although its development will further increase lithium resource demand, high lithium prices also provide impetus for the industry to develop and promote technological routes with relatively lower lithium dependency.
Against the backdrop of lithium carbonate prices approaching 150,000 yuan per ton, the new energy industry chain is undergoing unprecedented restructuring. “When the lithium carbonate price curve turns upward, what truly deserves attention is not the increase itself, but who can transform this price surge into sustainable profits and competitiveness in the new cycle,” interpreted one capital investment analyst. The fluctuation in lithium carbonate prices is not merely an industry “price war”; it is also an accelerator for the sector’s transition from “resource-driven” to “technology-driven.” In this process, only those companies possessing genuine technological strength, resource control, and cost advantages can seize the opportunity in the new cycle.
- Published in Blogs
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Including Multi-Billion-Dollar Projects! Major Overseas Lithium Battery Projects See New Developments in Recent Month
Monday, 12 January 2026
Global Lithium-ion Battery Shipments to Reach 1.899 TWh in 2025; Major Overseas Projects Update
According to the “White Paper on the Development of China’s Lithium-ion Battery Industry (2025)” jointly released by research institutions EVTank, Evidi Economic Research Institute, and the China Battery Industry Research Institute, global lithium-ion battery shipments reached 1545.1 GWh in 2024, a year-on-year increase of 28.5%.
EVTank predicts that global lithium-ion battery shipments will reach 1899.3 GWh in 2025 and 5127.3 GWh in 2030.
Since the start of 2025, several major overseas lithium battery projects have announced new developments:
Toyota Inaugurates First U.S. EV Battery Plant
On February 5th, Toyota announced the official opening of its $14 billion (approx. RMB 101.95 billion) EV battery plant located in North Carolina.
Toyota stated that the new facility is “ready” and will commence production in April this year to supply batteries for electrified vehicles in North America.
Notably, this is the company’s first wholly-owned battery plant located outside of Japan. Toyota expects the plant’s annual production capacity to exceed 30 GWh once fully operational.
On the same day, Toyota Motor Corporation also announced the establishment of a wholly-owned R&D and manufacturing company for Lexus BEVs (Battery Electric Vehicles) and batteries in Jinshan District, Shanghai.
The new BEV and battery company, a wholly-owned Toyota enterprise, will leverage the advanced and mature industrial chain foundation, logistics network, talent pool, and market scale of Shanghai and the Yangtze River Delta region. It will focus on R&D for LEXUS brand BEVs, reflecting Chinese customers’ expectations into products at “China speed,” with production planned to commence in 2027.
KORE Power Cancels Battery Plant Construction Plan
Also on February 5th, foreign media reported that KORE Power has canceled its plan to build a $1 billion (approx. RMB 728 million) lithium-ion battery factory in Buckeye, Arizona.
KORE Power plans to sell a plot of land in Arizona where it originally intended to build the 2 million square-foot (approx. 185,800 square meters) KOREPlex factory.
The KOREPlex was originally designed to produce Nickel Cobalt Manganese (NCM) and Lithium Iron Phosphate (LFP) cells for EVs and Energy Storage Systems (ESS), and was once positioned as the first U.S.-owned lithium-ion battery factory in the United States.
5 GWh! Automotive Giant Announces Construction of LFP Battery Plant
According to Nissan Motor Co., Ltd.’s official website, on January 22nd, the company signed a site agreement with Fukuoka Prefecture and Kitakyushu City to build a new factory producing Lithium Iron Phosphate (LFP) batteries in the Hibikinada area of Wakamatsu Ward, Kitakyushu City.
The plant is expected to have an annual capacity of 5 GWh and a projected investment of 153.3 billion Yen (approx. RMB 7.156 billion). Construction is planned to start in 2025, with operations expected to begin in 2028.
Zhuhai CosMX Malaysia New Energy Project Groundbreaking
On January 21st, the groundbreaking ceremony for the New Energy Project of Unimx Technology Malaysia Sdn.Bhd., a subsidiary of CosMX Battery, was held.
The Zhuhai CosMX Malaysia New Energy Project has a total expected investment of no more than RMB 2 billion and is scheduled to start production by the end of 2025.
The construction of the Malaysian production base will further improve CosMX Battery’s global manufacturing layout.
Phase 1 Annual Capacity of 8 GWh! REPT BATTERO Announces New Battery Factory
On January 9th, REPT BATTERO (00666.HK) announced that the Board of Directors had resolved to invest in building a battery factory in Indonesia through its non-wholly-owned subsidiary, PT REPT BATTERO INDONESIA.
The announcement stated that shareholders of the Indonesian subsidiary will subscribe for a total capital increase of $139.5 million. As of the announcement date, the Indonesian subsidiary is 60% owned by Infinitude, an indirect wholly-owned subsidiary of REPT BATTERO, which intends to contribute $83.7 million. After the capital increase, REPT BATTERO’s shareholding ratio will remain unchanged.
REPT BATTERO stated that upon completion, the Indonesian factory will engage in the R&D, manufacturing, and sales of lithium-ion batteries, battery components, modules, and battery packs in compliance with local government policies. The first phase is expected to produce 8 GWh of power and energy storage batteries and systems annually. The company expects the Indonesian factory to enhance its business in Southeast Asia, bring it closer to local customers and raw materials, and promote efficient resource utilization to achieve high-quality, sustainable development.
- Published in Blogs
From Surplus to Shortage? Energy Storage Emerges as Lithium’s “Game-Changer” as Morgan Stanley Warns of 80,000-Ton Deficit
Friday, 09 January 2026
As time officially steps into 2026, industry experts widely anticipate that the explosive growth of battery energy storage is poised to bolster the outlook for global lithium demand this year, offering a glimmer of hope for the accelerated recovery of a lithium sector that has been plagued by oversupply in recent years.
Since the second half of 2022, the lithium market has been grappling with a supply surplus. While the price surge triggered by the EV battery boom that year stimulated a supply spike, demand has struggled to keep pace with the massive supply volume for years. However, as reforms in China’s power sector drove an unexpected surge in lithium demand for energy storage batteries in the second half of 2025, this has underpinned a cautiously optimistic outlook for the lithium market in the coming year.
Industry insiders point out that the data center construction boom in China and globally has also driven the growth in lithium demand for power storage, emphasizing that the growth rate of lithium demand in the energy storage sector exceeded expectations in the second half of 2025. Looking ahead, energy storage is likely to become a “game-changer” for the lithium market, improving its fundamentals.
Data shows that battery energy storage systems have become China’s most profitable clean technology export—recording nearly $66 billion in export value in the first 10 months of 2025, surpassing electric vehicles (approximately $54 billion).
Morgan Stanley recently projected a global deficit of 80,000 tonnes of Lithium Carbonate Equivalent (LCE) for 2026; UBS estimates the deficit at 22,000 tonnes, following an expected supply surplus of 61,000 tonnes in 2025.
According to forecast ranges provided by a survey of four unnamed analysts, global lithium demand is expected to grow by 17%-30% in 2026, while supply is projected to increase by 19%-34%. These analysts predict a lithium price range of RMB 80,000-200,000 per tonne (approx. $11,432-$28,580) for 2026, compared to the 2025 range of RMB 58,400-134,500.
Looking back at the past year, lithium prices continued to fall in the first half of 2025, hitting a yearly low of RMB 58,400 on June 23rd. As profit margins and stock prices of global miners came under pressure, some companies were subsequently forced to cut production.
However, following China’s pledge to address overcapacity in several sectors, including lithium, the Jianxiawo mine—a lepidolite mine in Yichun owned by CATL—suspended production in August last year, triggering a sharp rebound in global lithium prices in the second half of the year.
Domestic lithium carbonate prices have now soared by 130% from their low point last year—reaching RMB 134,500 per tonne on December 29, 2025, the highest level since November 2023. Spot prices assessed by information provider Fastmarkets also rose by 108% over the same period.
Behind this sharp rebound in lithium prices, besides supply tightening, robust demand from energy storage has undoubtedly played a significant role. According to estimates from UBS, lithium demand in the energy storage sector is projected to surge by 71% in 2025, with growth expected to reach 55% in 2026.
Estimates from Guotai Junan indicate that demand for Lithium Carbonate Equivalent in the energy storage sector will account for 31% of total consumption in 2026, up from 23% in 2025, thereby further eroding the market share traditionally dominated by electric vehicle batteries.
Of course, looking ahead, the magnitude of the increase in lithium prices may still be capped, as excessively high prices could undermine the economic viability of energy storage.
Other major risks mentioned by analysts include: a potential faster-than-expected migration of energy storage systems towards sodium-ion battery technology; a slowdown in EV sales that could suppress demand; and supply growth that may limit the upside for price increases.
- Published in Blogs
Lithium Prices Skyrocket, but Midstream Giants Hit ‘Pause’! Coincidence or ‘Tactics’?
Thursday, 08 January 2026
Recently, the lithium carbonate market has presented a complex picture of “ice and fire.” On one side, futures and spot prices continue their strong upward trend with high market sentiment; on the other side, major lithium iron phosphate (LFP) producers such as Hunan Yuneng, Wanrun New Energy, Defang Nano, and Anda Technology have successively disclosed plans for maintenance and production cuts lasting one month. Why is there a divergence where the upstream raw material sector is “hot” while the midstream materials sector is “cold”? Is the timing of these maintenance shutdowns a coincidence or a deliberate maneuver?
01. Rising Prices and “Two Worlds” in the Industry Chain
On December 26th, lithium carbonate prices achieved a landmark breakthrough. On that day, the main lithium carbonate contract on the Guangzhou Futures Exchange (GFEX) strongly stood above the 130,000 CNY/ton mark, hitting an intraday high of 130,800 CNY/ton—a new high in nearly two years—with a cumulative increase of nearly 70% for the year. The spot market closely followed, with battery-grade lithium carbonate quotes rising in sync and market trading remaining active.
The fundamental driver supporting this rally lies in the explosion of demand. The energy storage market has become a new growth engine; statistics from GGII indicate that China’s total lithium battery shipments for energy storage are expected to exceed 580 GWh in 2025, a year-on-year increase of over 75%. Overseas, the U.S. “Big and Beautiful Act” enacted in July served as a catalyst. To circumvent the policy impacts of “strict restrictions on Foreign Entities of Concern (FEOC)” and the “early termination of solar/wind tax credits” within the Act, manufacturers rushed to commence construction within 2025 to lock in project subsidies. Additionally, major energy storage projects are planned in Europe, Saudi Arabia, and other regions. The confluence of these factors led to a surge in installation demand, resulting in a situation where high-end battery cells were “hard to find.” Furthermore, China’s power battery demand remains strong. From January to November 2025, domestic NEV sales reached 12.466 million units, a year-on-year increase of 23.2%, with market penetration historically breaking the 50% mark in October and continuing to grow. Battery companies are running at full capacity, and some automakers have even resorted to “stationing at factories to wait for goods” to ensure supply.
However, amidst the boom in upstream raw materials and robust downstream battery orders, four leading midstream LFP enterprises collectively cut production. From the evening of December 25th to the 26th, four major LFP producers—including Hunan Yuneng, Wanrun New Energy, Defang Nano, and Anda Technology—successively released announcements regarding production cuts for maintenance. The timing is concentrated at the end of 2025 to the beginning of 2026, with each maintenance period lasting one month. Among them, Wanrun New Energy expects to cut LFP production by 5,000 to 20,000 tons; Hunan Yuneng expects to cut phosphate cathode material production by 15,000 to 35,000 tons; Anda Technology expects to cut LFP production by 3,000 to 5,000 tons; and Defang Nano announced the maintenance of some equipment starting January 1, 2026, for approximately one month. Overall, excluding Defang Nano, the combined production cut scale for the three enterprises ranges from 23,000 to 60,000 tons. Such a synchronized reduction in scale has sparked significant market attention.
02. The Timing of Maintenance: Coincidence or Deliberate?
In fact, the most direct and indisputable trigger for this concentrated maintenance action is the objective need for equipment maintenance after long-term full-load production.
Since 2025, the explosive demand for NEVs and energy storage has driven a surge in LFP demand, keeping the capacity utilization rates of leading enterprises in a state of oversaturation. Hunan Yuneng’s announcement stated that “capacity utilization has exceeded 100% since the beginning of the year,” Wanrun New Energy mentioned that “the company’s LFP production lines have been operating under overload since the fourth quarter,” and Defang Nano and Anda Technology also face pressure for equipment maintenance due to high-intensity production throughout the year. From a conventional perspective, year-end maintenance is an industry practice. Long-term full-load production accelerates the wear and tear of core equipment (such as reactors and calciners), and regular maintenance aims to perform necessary upkeep and technological upgrades to avoid failure risks and ensure stable and efficient production in the coming year.
However, industry insiders claim that the collective maintenance by LFP manufacturers is more motivated by a pursuit of rebalancing interests within the industry chain.
As the core raw material for LFP, lithium carbonate prices have risen continuously since June 2025, with spot prices for battery-grade lithium carbonate rising from 60,000 CNY/ton to over 120,000 CNY/ton, directly pushing up cathode material production costs. Meanwhile, LFP processing fees have long been compressed below 15,000 CNY/ton, falling below the industry average cost line (15,700 – 16,400 CNY/ton). This scissors effect of “rising costs but stagnant processing fees” has led to widespread losses. In the first three quarters of 2025, Defang Nano’s gross profit margin was -2.13%, and Wanrun New Energy’s was only 1.7%. A relevant person from a listed LFP company stated that the industry has been in consecutive losses for nearly three years.
On a deeper level, this reflects a mismatch between the industry’s capacity cycle and the demand cycle. After the expansion wave in previous years, the cathode material sector has accumulated massive production capacity. When demand recovery first drives upstream resource prices to soar, the midstream sector, due to fierce competition and weak bargaining power, sees its overcapacity amplify cost shocks, and profits are drastically compressed in the industry chain redistribution. In a context where raw material prices continue to rise but cost pressures cannot be smoothly passed downstream, production equates to losses. Therefore, taking the initiative to cut production has become a rational choice for enterprises to cope with losses and reduce cash flow hemorrhage. The nearly simultaneous maintenance by leading enterprises essentially forms industry coordination; by collectively contracting supply in the short term, they aim to support market prices. In this context, lowering operating rates transforms from passive operational pressure into an active market “tactic”—its core intention is to create crucial space for subsequent price negotiations through phased supply contraction. As the head of an industry association put it, this is a “measure of last resort.” Consequently, the concentrated maintenance by leading enterprises is also intended to strengthen their bargaining chips for price increases with downstream battery cell manufacturers. It is understood that the industry has already initiated a second round of price increases, with mainstream enterprises planning to raise processing fees by 2,000 – 3,000 CNY/ton, which would significantly improve profitability if implemented.
This seemingly independent “tactic” actually resonates in frequency with upstream moves. Recently, upstream miner Tianqi Lithium, noting a “continuous and significant deviation” between traditional quotations (such as those from SMM) and spot/futures prices, deemed this a challenge to its operations and thus adjusted its pricing benchmark, reflecting a battle for dominance over a fairer pricing system. Meanwhile, the collective production cuts by midstream enterprises are a response to upstream demands for cost pass-through. Seemingly different moves by the upstream and downstream ultimately converge, aiming to jointly push product prices back toward a “cost + reasonable profit” level.
03. Future Outlook: High-Level Volatility and Reshaping of the Industry Chain
Looking ahead at the subsequent trend of lithium carbonate prices, experts point out that the market will enter a new phase of complex games between bullish and bearish factors. It is expected that the price center will fluctuate at a high level, while the internal structure of the industry chain faces reshaping. Short-term prices still receive solid support from several key industrial factors.
Cathode material factories cutting production to support prices makes a downward pass-through of lithium price increases promising. SMM analysis points out that although leading LFP enterprises have initiated a second round of negotiations recently, the first round for most other material factories has yet to materialize. Downstream battery cell manufacturers have generally recognized the pressure from raw material price increases, but actual implementation still awaits further negotiation results. If subsequent price increases by cathode material factories are realized, it will be more conducive to the downward transmission of lithium price increases, opening up upside potential. At the same time, Tianqi Lithium’s adjustment of its pricing benchmark also indirectly confirms strong downstream demand.
Industry high prosperity continues, with lithium carbonate inventories remaining low consecutively. According to survey data from Top 20 battery factories by TD Tech (TD), China’s lithium battery (energy storage + power + consumer) market production scheduling total for January 2026 is approximately 210 GWh, a month-on-month decrease of 4.5%, performing better than market expectations. According to SMM data, total weekly lithium carbonate inventories on December 25, 2025, were 109,800 tons, a month-on-month decrease of 652 tons, marking the 19th consecutive week of destocking, while inventory levels hit a new low since February 20, 2025.
Energy storage demand is also boosting expectations, and the supply-demand pattern is expected to improve in 2026. Benefiting from declining costs, policies promoting wider peak-valley price spreads, and the introduction of capacity electricity prices or compensation policies in some domestic provinces, domestic energy storage yields are expected to rise, thereby driving demand. According to Xinluo Consulting statistics, global lithium battery shipments for energy storage reached 620 GWh in 2025, a year-on-year increase of 77%, and are expected to reach 960 GWh in 2026, a year-on-year increase of 54.8%. From a capital expenditure perspective, capital expenditures by major global lithium mining companies have shown an inflection point decline since 2024, corresponding to an expected slowdown in supply growth for new or expanded projects in 2026 and 2027. Energy storage taking over from electric vehicles is expected to become the second growth curve for lithium demand, and the supply-demand pattern is expected to improve in 2026.
However, room for further significant upward price movement is clearly constrained. First, supply elasticity will gradually emerge. When prices stabilize at 130,000 CNY/ton and above, enthusiasm for resuming production of marginal capacities (such as mica-based lithium extraction) that were previously suspended due to high costs will increase, and overseas imports may also rise. Second, the “ceiling” effect of downstream affordability. The current predicament of midstream enterprises has sounded the alarm; if lithium prices continue to rise unilaterally and rapidly, it will seriously erode the profits of the entire mid-to-downstream manufacturing industry, ultimately biting back demand. This negative feedback mechanism will suppress price increases.
Synthesizing institutional views, in the short term, lithium carbonate prices will likely maintain high-level operation. The key observation points for the trend lie in the industry production scheduling plans for January 2026 and downstream acceptance of current prices. In the long run, this round of volatility may accelerate the optimization of the industry chain structure. Large-scale material enterprises with integrated lithium resource layouts and deep binding to high-quality customers will see their risk resistance capabilities and cost advantages become increasingly prominent. The entire industry is expected to shift from simple competition based on capacity scale to a comprehensive contest of supply chain stability, technological iteration speed, and cost control capabilities. A healthier and more resilient lithium battery ecosystem requires the establishment of a more reasonable and transparent mechanism for profit sharing and risk sharing between the upstream and downstream.
- Published in Blogs
From King of Separators to Sulfide “Materials Supplier”: Enjie’s Bold Bet on the Golden Decade Window for All-Solid-State Batteries
Wednesday, 07 January 2026
From Separator King to Sulfide “Materials Supplier”: Enjie’s High-Stakes Bet on the Golden Decade Window for All-Solid-State Batteries
When a disruptive technology signals an “overhaul” of your core business, the only thing you can do is acquire the companies building the tools for this change before the transformation arrives.
The lithium battery separator industry is experiencing a seismic shift.
Recently, Enjie, the global leader in battery separators, announced its plan to acquire Zhongke Hualian, a wet-process separator equipment manufacturer. Intriguingly, the target company ran at a loss last year. Meanwhile, Enjie itself is facing tough times, with a net loss of 556 million yuan in 2024 and continued losses in 2025.
A loss-making industry leader acquiring another loss-making upstream equipment supplier—does this sound like a mathematical game of “two negatives make a positive”, or a desperate act of “mutual support amid adversity”?
The story is far more complex and thrilling. Once an “invisible champion” that raked in 4 billion yuan annually from its lithium battery separator business and held a staggering 30% of the global market share, Enjie is now confronting two major challenges simultaneously: a brutal industry price war raging in the present, and a disruptive threat from the future technological roadmap—solid-state batteries.
This self-rescue effort by a leading enterprise with a market capitalization of over 100 billion yuan is not only a matter of life and death for the company itself, but also bears on China’s initiative in the entire lithium battery industrial chain. Every step it takes is a high-stakes gamble.
From Peak to Abyss: The “Avalanche” in Separator Prices
To understand Enjie’s predicament, we must first recognize how glorious it once was.
A lithium battery is like a sandwich: the cathode and anode are the two slices of bread, the electrolyte in between is the cream, and the separator is the insulating paper that prevents direct contact between the cathode and anode, which would otherwise cause a short circuit. This tiny membrane boasts extremely high technical barriers—its pore size, thickness, and strength directly determine the battery’s safety and lifespan.
Enjie reigned supreme globally in this “paper” segment. Its client list reads like a “who’s who” of the lithium battery industry: CATL, BYD, EVE Energy, CALB, and more.
Virtually all top-tier battery manufacturers count Enjie as their supplier. At the industry’s peak in 2022, the company recorded a revenue of 12.59 billion yuan, a net profit exceeding 4 billion yuan, and a gross profit margin that once neared 50%—making it a veritable cash cow.
However, super-profits attracted hordes of competitors. Driven by the boom in the new energy sector in recent years, capital from all walks of life flooded into the separator market, leading to a drastic expansion of production capacity. When supply growth far outpaced downstream demand, a ruthless price war ensued.
Data lays bare this “avalanche”: the price of mainstream 9μm wet-process base membranes plummeted from several yuan per square meter at the peak to around 0.8 yuan per square meter in the second half of 2025, edging perilously close to the industry’s cost line.
The consequences of this price collapse are directly reflected in Enjie’s financial statements:
- Stagnant Revenue: Growth turned negative in 2023, as the growth engine sputtered to a halt.
- Collapsing Profits: A net loss of 556 million yuan in 2024, followed by a further loss of 86 million yuan in the first three quarters of 2025.
- Gross Margin Halved—Then Halved Again: Plunging from the lofty heights of nearly 50% to a mere 11.07% in 2024.
Once the “profit king”, Enjie has fallen into a quagmire of stagnant revenue growth, shrinking profits, and even losses. The industry has transformed from a technology-driven blue ocean into a cutthroat red ocean dominated by cost competition.
Integrating the Industrial Chain: A Gamble on “Cost Reduction for Survival”
Faced with industry-wide losses, Enjie’s first move is vertical integration—acquiring upstream equipment supplier Zhongke Hualian.
The logic behind this move is clear: since it has no control over the prices of its downstream products (separators), it will seek profits upstream by seizing control of the lifeline of production equipment.
What is Zhongke Hualian’s background?
It is one of the few domestic companies capable of independently developing complete wet-process separator production lines, with over a decade of technical accumulation. Acquiring it means Enjie is expected to build an integrated chain covering equipment R&D and separator manufacturing.
The potential benefits of this seemingly “money-losing deal” include:
- Lower Equipment Investment Costs: Eliminating the need to purchase core equipment at high prices from external suppliers and instead producing equipment in-house can reduce fixed asset investment.
- Optimized Production Processes: Tighter integration between equipment and processes allows for targeted improvements to production lines, boosting efficiency and product yield.
- Building a Deeper Moat: Mastering core equipment technology in-house creates a complete technical barrier from equipment to products, making it harder for latecomers to catch up.
Enjie’s management has high hopes that this integration will effectively lower operational costs and drive profitability back on track. In essence, this is a battle for survival—one that seeks efficiency through better management and profits through industrial chain integration.
The Real “Gray Rhino”: The Disruptive Threat of Solid-State Batteries
Yet, compared to the cyclical industry price war, a larger and more fatal shadow looms over Enjie—the all-solid-state battery, hailed as the ultimate form of next-generation batteries.
The core of the problem is brutal and straightforward: in theory, all-solid-state batteries do not require separators.
Imagine spending years building a dominant position as the world’s largest candlewick supplier—only for the light bulb to be invented overnight. That is the long-term existential challenge Enjie faces. In 2024, 81.2% of the company’s revenue came from lithium battery separators. If this business is disrupted, it would spell disaster.
So, when will this “Sword of Damocles” fall? A rational analysis is needed:
The current industry consensus points to a gradual transition: liquid batteries → semi-solid-state batteries → all-solid-state batteries. Semi-solid-state batteries still require separators, providing Enjie with a valuable “escape window”. Moreover, the industry generally agrees that large-scale, low-cost commercialization of all-solid-state batteries will take another 5 to 10 years, or even longer.
This is Enjie’s most solid buffer. Currently, the core raw material cost of the best-performing sulfide solid electrolytes is over a hundred times that of liquid electrolytes. The overall cost of all-solid-state batteries is prohibitively high, meaning they are destined to be used only in ultra-high-end fields such as aerospace and deep-sea exploration for a long time, unable to shake the mainstream market of power batteries and energy storage batteries.
But this does not mean Enjie can rest easy. Once the wave of technological change is set in motion, it cannot be reversed. The company must find a second lifeline within this limited window.
Betting on Solid Electrolytes: From “Separator King” to “Materials Supplier”
Enjie is not sitting idly by. Its response strategy is clearly reflected in the direction of its R&D investment.
Even amid losses in 2024, the company’s R&D expenditure reached a substantial 663 million yuan, with continued increases. Where is this money going? The answer points directly to the future:
- Defending the Semi-Solid-State Fortress: Its subsidiary already has mass production and supply capabilities for semi-solid-state battery separators, actively expanding the market to ensure it does not fall behind during the transition period.
- Betting Big on the All-Solid-State Future: The company has strategically shifted its R&D focus to sulfide solid electrolytes—a technical route widely regarded as having the greatest long-term potential. In October 2025, the company announced that its pilot production line for high-purity lithium sulfide has been completed, and its 10-tonne production line for solid electrolytes has been put into operation.
- Opening a New Front in Energy Storage: Simultaneously, the company is seizing the opportunity of the booming energy storage market to drive product transformation, hoping to offset fluctuations in the power battery market with growing demand for energy storage batteries.
This means Enjie is attempting a risky identity transformation: evolving from a separator supplier in the liquid battery era to a core materials provider (solid electrolytes) in the solid-state battery era.
This is a thorny path. The technical routes and production processes of solid electrolytes are completely different from those of separators, equivalent to building an entirely new and equally competitive business on top of existing operations.
In the view of Yan Xi, Enjie’s predicament epitomizes the challenges faced by many leading Chinese manufacturers that rose to prominence by dominating a single technical high ground. They have reaped enormous dividends from technological breakthroughs, but are also more vulnerable to “precision strikes” from changes in technical routes.
Its self-rescue strategy is a combination of short-term defense and long-term offense:
- Short Term (1–3 years): Reduce costs and boost efficiency through vertical integration (acquiring Zhongke Hualian) to weather the industry downturn; simultaneously, firmly grasp the transitional demand for semi-solid-state batteries and expand into the energy storage market to stabilize its core business.
- Long Term (5–10 years): Go all-in on R&D, betting heavily on the sulfide solid electrolyte track to secure a future as a core supplier in a brand-new field.
This high-stakes gamble carries substantial risks:
- Cash Flow Pressure: With its core business losing money, continuous capital injection is required for mergers and acquisitions as well as cutting-edge R&D—placing extreme pressure on the company’s cash flow.
- Technical Route Risk: If the sulfide route fails to become the ultimate winner, or if the company’s R&D progress lags behind competitors, huge investments may be wasted.
- Transformation Execution Risk: Expanding from equipment to separators and then to electrolytes exponentially increases management complexity, placing extraordinary demands on the company’s strategic resolve and organizational capabilities.
The market’s current valuation of Enjie is a complex mix of discount and premium: discounted for the brutal price war and loss-making financial statements in the present; and premium for its global leading market share and its ambition to “regain the throne” in the solid-state battery era.
Its acquisition of a loss-making equipment supplier is not for simple financial consolidation, but to dig deeper trenches for survival. Its huge investment in the uncertain future of solid electrolytes is not chasing buzzwords, but buying a potential ticket to a new continent for long-term sustainability.
The crown of the “Separator King” is already cracked. With its actions, Enjie has made it clear that it is unwilling to be merely a king of the old era—it aspires to become one of the founders of the new era.
- Published in Blogs
Lithium Battery Prices Enter an Uptrend Channel: Rebalancing of Industrial Cycles and Value Logic
Tuesday, 06 January 2026
After years of an industry-wide downward cycle, the price of lithium iron phosphate has been on a continuous upward trend for six months starting from June 2025. Data from Shanghai Steelhome (25.720, +0.60, +2.39%) shows that as of mid-December 2025, the mainstream market price of power-oriented lithium iron phosphate had surged to RMB 41,200 per ton, representing a nearly 30% increase within half a year.
This price hike is by no means an isolated incident. A cost-driven wave of price increases, spanning from cathode materials to lithium salts, is reshaping the overall landscape of the lithium battery industry. Fueled by favorable cost-side dynamics, the new energy industry chain is undergoing a phase of self-calibration, with enterprises in niche segments such as large cylindrical batteries accelerating their deployment to capitalize on this trend.
Three Years of Industry Pressures Gradually Ease; Dual Drivers of Vehicle and Energy Storage Markets Propel Growth
Analysts point out that the current price rally of lithium iron phosphate is an inevitable outcome of the profound rebalancing of supply and demand following a three-year industry downturn. Fundamentally, it is underpinned by the dual demand drivers of the simultaneous expansion of new energy vehicles (NEVs) and energy storage sectors, which is gradually relieving the accumulated pressures across the industry.
From the end of 2022 to August 2025, the price of lithium iron phosphate materials plummeted by over 80%, placing significant profitability pressures on the entire industry.
The industry’s turning point emerged in June 2025. As upstream raw material prices climbed and downstream demand continued to recover, price increases became an inevitable choice for enterprises to sustain normal operations. Recently, several leading new energy companies including EVE Energy (68.970, +3.21, +4.88%) (rights protection), Chuangming New Energy, BAK Battery, and Tianneng Group have successively issued price adjustment notices, which are expected to drive a new round of performance growth for industry players.
Beneath the surface of rising raw material costs lies the robust support from the better-than-expected boom in downstream market demand—the core driver of this lithium iron phosphate price surge, stemming from the two key sectors of NEVs and energy storage.
Compared with lead-acid batteries, lithium iron phosphate batteries offer distinct advantages in performance, cost-effectiveness, and environmental friendliness. They have now become the mainstream technical route in NEVs, light-duty power systems, and energy storage systems, boasting strong irreplaceability. With the implementation of new national standards imposing higher requirements, the future market space for lithium iron phosphate batteries is set to expand further.
In the power battery sector, lithium iron phosphate has long established its dominant position. From January to November 2025, sales of lithium iron phosphate power batteries in China skyrocketed by 66.9% year-on-year, with their market share climbing to 72.8%. This growth momentum is highly aligned with the strong performance of the NEV market—during the same period, domestic NEV production and sales both exceeded 31% year-on-year, directly fueling the surge in demand for power batteries.
Demand growth in the energy storage market has been even more robust, emerging as another crucial engine driving lithium iron phosphate demand. GGII (Gaogong Industry Research Institute) predicts that the shipment volume of energy storage lithium batteries in China will surge by over 75% in 2025. Notably, nearly 100% of energy storage batteries adopt the lithium iron phosphate technical route, creating a more direct pull on upstream material demand. Data from relevant industry associations shows that lithium iron phosphate materials account for as high as 99.9% of the energy storage battery sector, solidifying its role as a key material cornerstone for the construction of new power systems.
From “Price Wars” to “Value Wars”: The Frenzy of “Full Production” for Large Cylindrical Batteries
The sustained recovery in prices is driving upstream and terminal battery industries to gradually move away from cutthroat low-price competition and enter a new development phase centered on value creation.
Industry-wide collaborative efforts to break the deadlock have taken the lead. In November 2025, representatives from seven major domestic lithium iron phosphate enterprises gathered in Beijing to discuss the industry’s future development direction. At the meeting, the China Chemical and Physical Power Industry Association explicitly advocated for reconstructing the industry’s pricing logic with cost indices as the core reference, fundamentally avoiding vicious competition and laying a solid foundation for the healthy development of the industry.
This guiding direction has already translated into positive signals at the enterprise operation level. Industry analysts generally believe that the dividends of this round of industry recovery will be concentrated more in leading enterprises with technological advantages, cost control capabilities, and high-quality customer resources.
Amid the explosive dual demand from the vehicle and energy storage sectors, small and medium-sized battery systems are also keeping pace. Light-duty power systems, portable energy storage, and residential energy storage are ushering in a new round of iterative growth. Take Chuangming New Energy, a veteran battery manufacturer and a leading player in the cylindrical battery segment, as an example. Recently, the company issued a public notice on price adjustments for large cylindrical lithium iron phosphate batteries, explicitly stating that it would raise prices for its entire range of battery products starting from December 1, 2025. This price adjustment is supported by the sustained high prosperity of its production capacity and orders—the Mianyang production base has maintained a long-term high capacity utilization rate, with its core product, the 32140 large cylindrical lithium iron phosphate battery, achieving full production and full sales. According to industry insiders close to the plant, current order backlogs are substantial, logistics operations are bustling, and production line automation efficiency ranks among the industry’s top tier. These details directly demonstrate the strong market demand for large cylindrical batteries.
Amid the competition among diverse battery technology routes, market attention on large cylindrical batteries has been continuously rising. Industry data shows that the global demand for large cylindrical batteries exceeded the 100 GWh mark in 2025. Coupled with the sustained growth momentum of small and medium-sized energy power systems, large cylindrical batteries are poised to enjoy considerable growth space in the coming years, emerging as a key driving force for the high-quality development of the battery industry.
Faced with rising material costs and fragmented market demand, enterprises with solid technological accumulation are building their competitiveness through product iteration and market positioning.
Taking Chuangming New Energy as an example, its 32140 lithium iron phosphate full-tab large cylindrical battery focuses on cost-performance ratio, while offering uniform heat dissipation and high safety. The battery can operate stably at a high temperature range of 60℃, making it highly suitable for light-duty power and residential energy storage markets in Southeast Asia and tropical regions. This technological advantage has been directly converted into market competitiveness. The company’s products have been mass-exported to markets such as the Middle East, Europe, and India, positioning it among the industry’s front-runners in overseas competition.
Future Outlook: Parallel Development of Technological Diversification and Market Segmentation
At present, the battery industry chain is in a period of dual transformation featuring structural adjustment and technological iteration. Beyond large cylindrical batteries, multiple technical routes including semi-solid-state, all-solid-state and sodium-ion batteries are also advancing in parallel and achieving accelerated breakthroughs.
For large cylindrical batteries, despite the core challenges they still face such as production efficiency and product consistency, they have been expanding their application scenarios by virtue of their unique advantages in energy density and structural stability. These batteries have deeply penetrated high-end electric vehicles, residential energy storage, portable energy storage and other fields, and have also emerged in emerging tracks such as eVTOL. With the continuous advancement of material system upgrading and production process optimization, large cylindrical batteries are expected to further unlock their market potential in light-duty vehicles, energy storage systems and other sectors, and play a more pivotal role.
The industry boom is also undergoing structural reshaping. Brokerage analysts point out that this round of lithium iron phosphate price increases is backed by solid fundamentals, and the industry’s long-term development trend remains positive. In addition, insiders from lithium battery enterprises indicate that downstream demand continues to stay robust, and the price adjustments triggered by cost pass-through are essentially a rational return of industry value.
Standing at the new starting point where the industry is moving towards high-quality development, the core competitiveness of enterprises will no longer be simply limited to production capacity scale and cost control capabilities, but will depend more on the comprehensive competition of technological innovation, capital strength and supply chain collaboration capabilities.
- Published in Blogs
Planning to Replace Your E-Vehicle Battery with a 5-Year Durable Option? Lithium Iron Phosphate vs. Sodium-Ion Batteries – A Comprehensive Breakdown of Costs and Cost-Effectiveness
Monday, 05 January 2026
Many e-vehicle owners are plagued by the problem of short battery life and frequent replacements. Numerous users report that the batteries they currently use often need to be replaced after just 1 to 2 years. If you want to choose a battery pack that can be used stably for more than 5 years, which type is actually more suitable? And what about the replacement cost? Industry insiders have provided professional recommendations.
In terms of battery performance, traditional lead-acid batteries and graphene batteries generally have a low number of charge-discharge cycles, making it difficult for them to meet the demand for more than 5 years of use. In contrast, lithium iron phosphate (LFP) batteries have a design life of over 2,000 cycles, with a theoretical service life of 8 to 10 years. Sodium-ion batteries (NIB) boast an even higher cycle count, exceeding 2,500 cycles, and also offer durability of more than 5 years. Therefore, if long-term use is a priority, these two battery types are the better choices.
The cost of battery replacement varies by type. Taking the 48V specification as an example, BYD’s special LFP battery for two-wheeled vehicles (with a 24Ah capacity) is priced at approximately 1,300 yuan, and a fast charger is included with the purchase. If the user’s original vehicle uses a lithium battery with a matching voltage, direct replacement is possible without additional modifications. For sodium-ion batteries, Chaowei’s 48V21Ah “Sodium Commander” battery is priced at around 900 yuan, also equipped with a fast-charging device. However, it should be noted that sodium-ion batteries have different interface standards from lead-acid or lithium batteries. Replacement requires simultaneous upgrades to components such as the controller and charger, and some vehicle models even need a dashboard replacement, resulting in a total cost similar to that of lithium batteries.
Regional differences are a key factor in battery type selection. In southern regions where winter temperatures are relatively high, LFP batteries have a distinct advantage in stability. They are particularly suitable for users whose original vehicles are already equipped with lithium batteries, as they offer higher safety and compatibility. In northern China, especially in areas with long, cold winters such as the Northeast and Northwest, sodium-ion batteries excel in low-temperature resistance. Measured data shows that Chaowei’s sodium-ion batteries can maintain over 90% of their capacity at -25℃, effectively solving the problem of reduced range in winter.
Although lead-acid batteries are inexpensive, their short service life and frequent replacement requirements mean that their long-term cost is not advantageous. If users wish to reduce the replacement frequency, LFP batteries and sodium-ion batteries are more economical options. Despite the higher initial investment, when amortized over a 5-year usage cycle, the annual average cost is actually lower. Additionally, they eliminate the hassle of frequent maintenance.
- Published in Blogs
Full-Scale Price Hike Across the Lithium Battery Industry: Power Battery Shortage Eases, While Energy Storage Battery Scarcity Persists
Sunday, 04 January 2026
IT Home reported on December 31 that according to a report by Red Star News today, the shortage of power batteries for automakers has eased, but energy storage batteries remain scarce, leading to a full-scale price increase across the lithium battery industry.
The report stated that due to tight supply from first and second-tier battery manufacturers, some automakers dispatched personnel to battery companies to “scramble for batteries” between September and November 2025. By the end of 2025, the supply crunch of power batteries had alleviated, yet the shortage of energy storage batteries is expected to persist.
- Published in Blogs
CATL Drops Out of Top 5 Customers! Good Electric Materials Files for IPO: Zhu Guolai Receives Over RMB 35 Million in Dividends in 3 Years
Wednesday, 31 December 2025
Family Members of the Actual Controller Hold Concentrated Shares, Export Pressure Mounts and Domestic Profit Margins Narrow: Multiple Challenges Behind Good Electric Materials’ IPO Journey
On December 22nd, Good Electric Materials System (Suzhou) Co., Ltd. (hereinafter referred to as “Good Electric Materials”) officially submitted its registration application, with Soochow Securities as the sole sponsor. It only took the company 6 months to advance from submitting the prospectus to the Growth Enterprise Market (GEM) of the Shenzhen Stock Exchange to the registration stage, marking a rapid IPO process.
Notably, prior to this crucial juncture of sprinting for listing, Good Electric Materials’ shareholder camp has been filled with the relatives and friends of the actual controller Zhu Guolai—his wife, brother-in-law, former colleagues, and others have all become shareholders. Once the company successfully lists on the capital market, this “capital feast” will be shared by Zhu Guolai and his relatives and friends.
Compared with Good Electric Materials itself, its customer list is more well-known, including industry-leading enterprises such as CATL, Geely Auto, General Motors, and Xpeng Motors. In business cooperation, Good Electric Materials’ core role is to provide new energy vehicle power battery thermal runaway protection components for these customers, deeply binding itself to the core links of the new energy vehicle industry chain.
Although China has firmly established itself as the world’s largest new energy vehicle market, Good Electric Materials’ business layout has shown a distinct trend of “going global”, with its dependence on exports increasing year by year. However, changes in tariff policies in the international trade environment have impacted the company’s overseas business, directly leading to a decline in procurement scale from foreign-funded customers. Taking General Motors as an example, in the first 9 months of this year, its procurement volume from Good Electric Materials was halved compared with the same period last year.
At the same time, the competitive pattern of the domestic market has also put pressure on Good Electric Materials. The company has weak pricing power in the domestic market, with product prices remaining at a low level for a long time, and the gross profit margin of its core business has been declining for many consecutive years. With export channels blocked on one side and domestic profit margins continuously compressed on the other, Good Electric Materials’ path to breaking through the predicament is full of uncertainties.
I. Founding Team All Departed, Zhu Guolai Seized Control Against the Trend to Rewrite the Enterprise’s Trajectory
Tracing back its development history, Good Electric Materials did not start in the new energy vehicle field but in the power industry. In April 2008, Shi Huirong and Zhu Xingquan jointly invested 1 million yuan to establish Good Electric Co., Ltd. (hereinafter referred to as “Good Electric”), the predecessor of Good Electric Materials, with Shi Huirong holding 60% of the shares and Zhu Xingquan 40%.
In the early days of its establishment, Good Electric focused on the power electrical insulation materials track, with key layouts in niche markets such as high-voltage generators and UHV power transmission and distribution. Relying on accurate market positioning, the company quickly opened up the situation: in 2009, it entered into strategic cooperation with France’s Firo and the United States’ Hexion; in 2010, it successfully entered the wind turbine blade structural adhesive market, and its business gradually got on track.
Unexpectedly, just as the enterprise was showing a good development momentum, the two founders chose to leave one after another. In March 2011, Shi Huirong transferred 9% of the company’s registered capital held by him to Zhu Guolai at a price of 2.7 million yuan; in the same period, Zhu Xingquan transferred 20% of the registered capital to Zhu Guolai and Zhu Haofeng respectively, with a total transfer price of 12 million yuan. Public information shows that Zhu Guolai and Zhu Haofeng were former colleagues.
After the completion of this equity transfer, Zhu Xingquan completely withdrew from the shareholder ranks, and Zhu Guolai and Zhu Haofeng held 29% and 20% of the company’s shares respectively. In November of the same year, Shi Huirong transferred the remaining equity again, transferring 41% of the registered capital to Zhu Guolai and 10% to Suzhou Guohao (a company controlled by Zhu Guolai), thus completely withdrawing from the company. After these two rounds of equity changes, Zhu Guolai’s direct shareholding ratio soared to 70%, officially becoming the company’s controlling shareholder.
It should be noted that in the above two rounds of equity transfers, the unit price of equity transferred by Shi Huirong and Zhu Xingquan was 1 yuan per registered capital. Notably, Shi Huirong is exactly Zhu Guolai’s father. Behind this series of equity changes, there are still many questions to be answered: Was the company profitable at the time of the equity transfer? Why did the founders choose to transfer their equity at par and leave? Is there any undisclosed affiliated relationship between Zhu Xingquan, Zhu Guolai, and Zhu Haofeng? Are there any irregularities such as shareholding on behalf of others or interest transfer during the equity transfer process?
After fully taking control of the company, Zhu Guolai initiated business transformation and expansion. In 2016, the company achieved a key breakthrough in the R&D of thermal runaway protection for new energy vehicles; in 2018, it further accelerated the layout of new energy vehicle business by acquiring Mica Electric, a mica production enterprise. Currently, the company’s products cover all levels of thermal runaway protection components such as battery cells, modules, and battery packs, successfully entering the core supply chain of new energy vehicles.
Taking advantage of the rapid development of China’s new energy vehicle industry, Good Electric Materials successfully became a supplier to leading battery manufacturers and automakers such as CATL, Tesla, Geely Auto, and General Motors, with simultaneous growth in revenue and profit scales. Financial data shows that from 2022 to the first half of 2025, the company achieved operating income of 475 million yuan, 651 million yuan, 908 million yuan, and 458 million yuan respectively, and net profit attributable to parent company shareholders of 64.0586 million yuan, 100 million yuan, 172 million yuan, and 81.1605 million yuan respectively, showing a good trend of double growth in revenue and profit.
Benefiting from the steady growth of performance, Good Electric Materials’ IPO process progressed smoothly. From submitting the prospectus in June 2025 to successfully passing the review on December 19th and submitting the registration on December 22nd, the whole process took only half a year. However, whether this impressive performance report card can ultimately win the recognition of the capital market remains to be tested by time.
II. Rising Dependence on Exports Hits a Snag, General Motors’ Procurement Halved Under Tariff Impact
Today, new energy vehicle-related business has become the core pillar of Good Electric Materials. As of the end of June 2025, new energy vehicle power battery thermal runaway protection components (hereinafter referred to as “power battery components”) contributed 67.3% of the company’s main business income, making them the absolute main source of revenue.
In recent years, China’s new energy vehicle market has continued to expand, not only giving birth to local leading automakers such as BYD, NIO, Li Auto, and Geely, but also gathering globally leading battery enterprises represented by CATL, with broad market space. However, against this background, Good Electric Materials has chosen to increase its overseas market layout, with the proportion of exports continuing to rise.
Financial data shows that from 2022 to 2024, the company’s export volume was 73.0453 million yuan, 186 million yuan, and 397 million yuan respectively, accounting for 15.50%, 28.82%, and 44.29% of the current main business income, achieving double growth in three years. Regarding the increase in the proportion of exports, Good Electric Materials explained in its reply to regulatory inquiries that the overseas new energy vehicle market is dominated by ternary lithium batteries, which have a more urgent demand for thermal runaway protection, and the company’s overseas customers are mainly automakers, giving it relatively stronger pricing power.
In sharp contrast to the overseas market, the domestic power battery market is highly concentrated, with leading battery manufacturers such as CATL and BYD occupying a dominant position and having strong discourse power. Good Electric Materials also admitted in its prospectus that in the fierce domestic market competition environment, the company’s pricing power is relatively weak.
This difference is directly reflected in product pricing and profitability. From 2022 to the first half of 2025, the export unit price of Good Electric Materials’ power battery components (excluding molds) rose from 50,400 yuan/ton to 139,200 yuan/ton, and the gross profit margin increased from 33.43% to 40.53% simultaneously; during the same period, the domestic sales unit price remained around 50,000 yuan/ton, while the gross profit margin dropped from 32.53% to 25.63%, indicating a continuous narrowing of domestic profit space.
More seriously, operational risks in the overseas market have gradually emerged. Good Electric Materials’ core overseas market is the United States, but frequent adjustments to U.S. tariff policies in recent years have significantly impacted the company’s export business. In the first 9 months of 2025, the company’s sales to General Motors were 75.6963 million yuan, a sharp year-on-year drop of 50.36%; in addition, sales to Company T (Tesla) and Volkswagen decreased by 0.55% and 33.90% year-on-year respectively.
Regarding the sharp decline in sales to General Motors, Good Electric Materials explained that it was mainly affected by two factors: first, changes in U.S. tariff policies in the first half of 2025 led General Motors to adjust the import locations of some components, resulting in delayed shipments in the second quarter, which directly dragged down the revenue in the first three quarters; second, General Motors had overly optimistic expectations for the growth of the new energy vehicle market earlier, and the supply chain inventory exceeded the actual market digestion capacity, leading to a short-term slowdown in the procurement rhythm of the supply chain.
To cope with the impact of tariff policies, Good Electric Materials has launched adjustments to its overseas layout. In June 2023, the company established a subsidiary in Mexico, focusing on the production and processing of new energy vehicle thermal runaway protection components; in November 2023, a U.S. subsidiary was established; in May 2025, a German subsidiary was launched, focusing on building an overseas marketing network to be responsible for the expansion of the North American and European markets and customer relationship management.
However, whether this series of adjustments to overseas layout can effectively hedge against the impact of tariffs and gain more overseas orders remains uncertain. From an industry perspective, the company’s overseas layout is more of a “passive response”—the domestic new energy vehicle market is fiercely competitive, the company’s profit space is severely squeezed, and it is difficult to further seize market share. The most typical example is that CATL was still Good Electric Materials’ largest customer in 2022, dropped to the third place in 2023, and completely withdrew from the list of the top five customers in 2024 and the first half of 2025.
Regarding the domestic market layout, there are still many questions to be clarified for Good Electric Materials: Has the sales volume to CATL continued to decline? Does the company plan to expand more domestic customers to optimize its customer structure? Why is there a huge gap between domestic and foreign product prices? How to balance the development rhythm of domestic and foreign markets to reduce operational risks?
III. Family Members Deeply Bound, Zhu Guolai Received Over 35 Million Yuan in Dividends in Three Years, Fund Raising for Liquidity Arouses Controversy
Today, Zhu Guolai still firmly controls the operational decision-making power of Good Electric Materials. Before the IPO application, Zhu Guolai directly held 46.76% of the company’s shares, and indirectly held 2.09% of the shares through two enterprises, Suzhou Guohao and Suzhou Guofeng, with a total shareholding ratio of 48.85%. Currently, Zhu Guolai serves as the company’s chairman and general manager, and is the company’s controlling shareholder and actual controller.
In addition to Zhu Guolai himself, his family members and former colleagues are also deeply involved in the company’s equity structure and operational management. Among them, Zhu Ying, Zhu Guolai’s wife, directly holds 1.12% of the shares; Zhu Min, Zhu Ying’s elder brother, holds 401,500 shares of the company; Zhu Haofeng, the second largest shareholder of the company, holds 10.65% of the shares, and his wife Qian Yuping holds 1.52% of the shares. Public information shows that Zhu Guolai and Zhu Haofeng once worked together at Wujiang Taihu Insulation Materials Factory for many years.
Notably, in March 2023, Good Electric Materials transferred 5% of the equity of its subsidiary Good瑞德 (Good瑞德) to Zhu Jianfeng at a price of 0 yuan. Data shows that Good瑞德 was established in June 2022, with its main business being copper-aluminum composite materials. It is a core platform for Good Electric Materials to expand into the new materials field, and its production line was gradually completed and put into operation in 2023. It is reported that Zhu Jianfeng and Zhu Guolai met through their hometown relationship, and the rationality of this 0-yuan equity transfer has also aroused market concern.
At the operational management level, family members also have a high degree of participation: Zhu Ying serves as the company’s investment director, Zhu Haofeng as a director and deputy general manager, Qian Yuping works in the Administration and Human Resources Department, and Zhu Xingzhu, Zhu Guolai’s mother, once worked in the company’s Production Department. In addition, the company provided loans to Shi Huirong (Zhu Guolai’s father), Zhu Xingzhu (Zhu Guolai’s mother), and the couple Zhu Haofeng and Qian Yuping in the early days, with loan amounts ranging from 350,000 yuan to 2.4 million yuan.
If Good Electric Materials is successfully listed, these family members will jointly share the dividends of capital appreciation. In fact, before the company sprinted for the IPO, Zhu Guolai had already obtained considerable benefits through cash dividends. From 2022 to 2024, Good Electric Materials implemented cash dividends of 28.185 million yuan, 15.525 million yuan, and 31.05 million yuan respectively, with a total dividend amount of 74.76 million yuan in three years. Based on a rough calculation of Zhu Guolai’s total shareholding ratio of 48.85%, he could receive more than 35 million yuan in dividends in three years.
Puzzlingly, after three consecutive years of cash dividends, Good Electric Materials plans to raise a large amount of funds to supplement working capital in this IPO. The prospectus shows that the company plans to raise 1.176 billion yuan this time, which even exceeds the company’s current total asset scale. As of the end of June 2025, Good Electric Materials’ total assets were 1.13 billion yuan, of which monetary funds were 271 million yuan, and there were no short-term loans, indicating a certain ability of capital turnover.
This series of financial arrangements has aroused many questions: If the company has capital needs for business expansion, why does it still continue to implement cash dividends? With the actual controller’s shareholding ratio close to 50%, does continuous dividend distribution have the suspicion of transferring interests to the actual controller? Is the scale of this fund-raising exceeding the company’s total assets reasonable? Is the operation of distributing dividends while raising funds to supplement working capital reasonable? Does it have the intention of “harvesting” the capital market?
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The Long-Term Contract Wave Spurs a RMB 400 Billion Capacity Expansion Spree—Energy Storage Is Treading the Well-Worn Path of PV Overcapacity!
Monday, 29 December 2025
The “Long-Term Contract Wave” Sweeps Across the Lithium Battery Industry
Booming Energy Storage Market Spurs Leaders to Secure Long-Term Contracts
High Capacity Utilization Drives Raw Material Price Hikes
Mounting Delivery Pressures Trigger New Round of Capacity Expansion
Lithium Battery Enterprises Face Mixed Sentiments Amid Painful PV Industry Lessons
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