Lithium power equipment refers to various manufacturing equipment used in the production of lithium batteries.

With the rapid growth of the demand for lithium batteries in the field of power and energy storage, the market scale of China's lithium power equipment industry has continued to expand, from 36.71 billion yuan in 2018 to 94.14 billion yuan in 2022, with an annual compound growth rate of 26.5%.

As of April 2023, the localization rate of lithium power equipment in China has also reached more than 90%, of which the localization rate of equipment in key processes has reached more than 80%.

China's lithium power equipment manufacturers have a wide range of business links and strong comprehensive strength.

With the advent of the industry 4.0 era, intelligent upgrading has become an inevitable trend in the development of China's equipment manufacturing industry. Lithium power equipment manufacturing belongs to the high-end equipment manufacturing industry, so it also follows the development direction of intelligence.

Deploying cloud platforms and intelligent control equipment can effectively collect equipment production data. Lithium power equipment enterprises can realize intelligent production management through the cloud platform to reduce operating costs and improve production efficiency.

Which link is the most critical in the industrial chain of the lithium power equipment industry? The future development trend of the lithium power equipment industry? Lithium power equipment industry operator layout? What competitive advantages do each have?

01 Overview of China's lithium power equipment industry

Lithium power equipment refers to various manufacturing equipment used in the production process of lithium batteries. According to the corresponding lithium battery production steps, lithium power production equipment can be divided into front equipment, middle equipment and back equipment.

In 1998, China's lithium power equipment manufacturing industry began to start, but it relied heavily on early imports. In 2013, the localization rate of lithium power equipment reached 30%, and the lithium power equipment market entered a period of rapid growth. After 2018, the integration of the lithium power equipment industry accelerated, and the market share was further concentrated in leading enterprises.

Among the value of lithium power equipment, the first-stage equipment, middle-stage equipment and back-stage equipment account for 30%, 40% and 30% respectively. As of April 2023, the localization rate of lithium power equipment in China had also reached more than 90%, among which the localization rate of equipment in key processes had reached more than 80%.

With the rapid growth of the demand for lithium batteries in the field of power and energy storage, the market scale of China's lithium power equipment industry has continued to expand, from 36.71 billion yuan in 2018 to 94.14 billion yuan in 2022, with an annual compound growth rate of 26.5%. It is expected to grow to 1331.5 billion yuan in 2027.

02 Industrial Chain Analysis of China's Lithium Power Equipment Industry

There are many upstream parts in the lithium power equipment industry chain, and steel is the main raw material for its core components; there are many competitors from midstream lithium power equipment manufacturers, and the industry competition is fierce; in the downstream lithium battery application field, the power field accounts for the largest proportion, with China's power lithium battery shipments in 490GWh in 2022.

The cost structure of lithium power equipment includes raw materials, labor costs and manufacturing costs, of which raw materials account for the largest proportion, at more than 80%. However, with the gradual increase of the localization rate of core components, the proportion of raw material costs has shown a downward trend, and labor and manufacturing costs have increased.

From 2017 to 2022, China's crude steel production has continued to rise to decrease year by year, but the overall supply is still relatively sufficient, which can provide a stable and sufficient supply of raw materials for the lithium power equipment industry. The decline in steel prices has also released more profit margins for midstream lithium power equipment manufacturers.

Lithium power equipment manufacturers implement a qualified supplier management system, which requires high requirements for suppliers; most of their production plans are determined according to sales orders to achieve sales; from the perspective of sales models, lithium power equipment manufacturers usually sign sales contracts directly with customers.

In 2022, the global shipment volume of lithium-ion batteries was 958GWh, of which China's lithium-ion batteries was 658GWh. China is currently the world's largest producer and consumer of lithium-ion batteries. While meeting the domestic consumer market, Chinese lithium battery enterprises have gone overseas to expand overseas markets.

03 Drivers and development trends of China's lithium power equipment industry

In 2022, China's lithium battery shipment structure accounted for the largest proportion of lithium batteries, 74.4%, and shipments reached 490GWh. Driven by the growth of downstream demand for new energy vehicles, the rapid development of power lithium batteries also provided a strong driving force for the development of upstream lithium power equipment.

In 2022, China's energy storage lithium battery shipments were 130GWh, and the installed scale of energy storage lithium batteries accounted for 94.4% of the new energy storage capacity. The growth point of the future development of the energy storage lithium battery industry also provided a new driving force for the development of the lithium power equipment industry.

With the advent of the industry 4.0 era, intelligent upgrading has become an inevitable trend in the development of China's equipment manufacturing industry. Lithium power equipment manufacturing belongs to the high-end equipment manufacturing industry, so it also follows the development direction of intelligence.

Deploying cloud platforms and intelligent control equipment can effectively collect equipment production data. Lithium power equipment enterprises can realize intelligent production management through the cloud platform to reduce operating costs and improve production efficiency.

04 Competition pattern of China's lithium power equipment industry

Driven by the rapid growth of the lithium power and new energy vehicle industry, China's lithium power equipment industry has a large number of participating enterprises and fierce competition.

After years of development, China's lithium power equipment industry has nurtured strong leading enterprises. At the same time, leading enterprises further strengthen their competitive advantages to resist risks by cooperating with head lithium battery manufacturers.