When it comes to the power lithium battery market, people can not help but talk about its “three parts of the world” pattern: due to differences in shape and materials, cylindrical, square and soft pack batteries have their own advantages, which has attracted enterprises to stand in line one after another.
Cylindrical battery was the leader in the past. It once dominated the market due to relatively low cost and mature production technology, but now it is gradually declining; At present, square battery is the most popular, with good performance in terms of cost and energy density. It is widely promoted by leaders such as Ningde era (300750) and BYD (002594); The soft pack battery is like a rising star. It performs very well in all aspects, but it is not easy to “control”. Few enterprises can mature and use its technology.
For enterprises, choosing the camp to stand in line is no less than a “bet” on fate. Companies that embraced square battery technology ten years ago may now be at the height of the sun; Enterprises that choose cylindrical batteries may lament their bad luck. Choosing the route of soft pack battery takes a lot of research and development effort. The enterprises here are rare, but they are standing at the starting point of the rising channel.
Funeng technology is one of them. Few enterprises in the whole industry, like Funeng technology, have firmly followed the technical route of soft pack battery since its establishment, and firmly believe that soft pack battery will eventually prevail in the market. Now, this persistence has finally paid off. Funeng battery has become the leader in the soft pack battery market. Its shipment volume has ranked first in China for two consecutive years. It is the first choice for cooperation among BAIC, Mercedes Benz, great wall and other well-known automobile enterprises.
After mastering the soft pack battery technology, what are the technical advantages of Funeng technology compared with the enterprises in the square battery camp? Can its product cost performance surpass the latter? How to promote the new technology of soft pack battery to the whole market?
Strong card position soft pack battery
Funeng technology’s forward-looking judgment on flexible battery benefits from the profound scientific research background of the founder. Before founding Funeng technology, Dr. Wang Xuan and Dr. Keith were senior lithium battery scientists all over the world and made great achievements in the research of power batteries with high energy density. After returning to China in 2009, they founded Funeng technology, dared to be the “first person to eat crabs”, and established the technical route of soft package packaging structure.
“High energy density” is the core direction of Funeng technology research and development. The power battery with soft package structure and ternary material perfectly conforms to this characteristic:
Compared with the steel and aluminum hard shell used for square or cylindrical batteries, the soft pack battery shell is a lightweight aluminum-plastic film. Under the same capacity, the overall mass of the soft bag is 20% lighter than that of the cylinder and more than 30% lighter than that of the square hard shell. Therefore, in terms of energy density, the soft pack battery is enough to “sling” the other two.
The addition of ternary materials adds to the deep “internal force” of soft pack batteries. Combined with cobalt, nickel and manganese, ternary materials have their own advantages. It not only has higher energy density, but also has higher stability and longer cycle life.
After choosing the right Camp, Funeng technology stands out in the market. At present, the company can mass produce power batteries with single cell energy density up to 285wh / kg, which can be compared with only a few enterprises in the world, and Ningde times and Panasonic can’t. In terms of safety performance, cycle life and other indicators, the company’s product performance is in the leading position in the industry.
With excellent technology, what is the prospect of Funeng technology?
Looking at the whole market, in recent years, the power battery field has shown a rather “contradictory” situation:
On the one hand, among more than 100 power battery enterprises in China, the top five enterprises account for more than 85% of the market, but they only account for less than 45% of the production capacity. The capacity utilization rate of a large number of small and medium-sized enterprises has been lower than 35% for a long time, and the supply is in a state of serious surplus. On the other hand, the high-end market is in short supply. The top five manufacturers in the industry contribute more than 70% of the installed capacity, and are often in the state of full production and full sales. Audi, Tesla, Mercedes Benz and other manufacturers have repeatedly been trapped by problems such as insufficient battery capacity and delayed the delivery of vehicles.
The special situation of “insufficient high-end capacity and excess low-end capacity” brings great growth opportunities to high-performance battery manufacturers. As one of the few manufacturers that can mass produce ternary soft pack batteries, Funeng technology has prominent advantages:
The demand of new energy vehicles for long range and high safety performance is becoming increasingly urgent, and more and more vehicle enterprises have turned their attention to soft pack batteries. Among the top ten car companies in the world, 7 have mass produced soft battery passenger cars, among which 4 popular cars including Nissan LEAF are firm defenders of soft battery. In 2018, China’s soft pack battery shipments reached 10.1gwh, an increase of 48% over the previous year. It is estimated that in the seven years of 2025, the shipment of soft pack batteries will increase at a compound annual rate of 36%.
In this context, Funeng technology has become the first choice for automobile enterprise cooperation. In the field of soft pack batteries, the company’s product shipments and installed capacity have ranked first in China for three consecutive years, with a market share of 20%. By 2019, the company has provided battery products for more than 125000 new energy vehicles. Thanks to its outstanding performance, Funeng technology has firmly taken the leading position in the industry.
However, as a high-end battery supplier, the problem of insufficient capacity also puzzles Funeng Technology:
Its potential order size is expected to be 220gwh, while the current annual effective capacity is still less than 2.5gwh, which is far from matching the demand. For four consecutive years, the capacity utilization rate of Funeng technology is more than 90%, which is basically in full production.
The problems caused by limited production capacity are becoming more and more obvious: on the one hand, the production capacity bottleneck leads to the ceiling of operating revenue growth, on the other hand, the expensive raw materials and the scale effect can not be fully released, resulting in the contraction of profits. In terms of performance, Funeng technology’s revenue growth fell sharply in 2018, the gross profit margin “halved”, and the net profit “turned into a loss”.
How to expand production? Funeng technology is fully open to this. The effective measure taken is to raise 3.44 billion to expand Funeng Zhenjiang production base.
By then, Zhenjiang phase III project will enable Funeng technology to have an average annual 24gwh battery production capacity. It is estimated that by 2020, the completion and operation of the first two phases of Zhenjiang project will increase the company’s effective production capacity to 7gwh, bring an average annual operating revenue of 3 billion, an increase of 33% on the basis of 2 billion in 2018. The scale effect will also further improve the company’s gross profit margin. It is estimated that by 2021, Funeng technology Zhenjiang project will stably supply Daimler with products with an average annual scale of 20gwh, and the gross profit margin will increase to 21.8%.
The lithium battery market is accelerating to concentrate on leading manufacturers. If the production expansion of Funeng technology, as a leader, is smooth, it is bound to be invincible and expand the leading advantage of the leader.
Accelerating the leap under the “halo” of famous enterprises
The growth of large power battery manufacturers is always supported by “good partners” such as large automobile enterprises. BMW Brilliance used to use 700 pages of battery standard specifications, which made the first single power battery business of Ningde era experience “painful” running in for two years. After completing the whole process from R & D to mass production, Ningde era has entered the supply chain of multinational car enterprises and finally become a generation of overlord.
The alliance between Funeng technology and BAIC, the world’s top 500, is the second “good story” in the industry. It is as hot as the cooperation case between Ningde era and BMW in that year, which has been talked about by people so far.
In 2017, the two signed a five-year strategic cooperation agreement on 1 million new energy vehicles, which became the largest order in employment history. In that year, Funeng technology broke into the top five camps of the power battery market and jumped from an unknown soft pack battery manufacturer to a leader.
In fact, Funeng technology has been a supplier of BAIC as early as 2015. Before taking over the huge “olive branch” thrown by BAIC, Funeng technology battery has been equipped with all its models, with a single vehicle mileage of more than 10000 kilometers, but there has never been a safety accident. Excellent product quality endorsed the brand of Funeng technology, and finally won the favor of famous enterprises.
The BAIC EC series new energy vehicles launched after the cooperation between the two have become a popular model in the industry. In 2018, the sales volume of BAIC EC series exceeded 90000, nearly doubling the second sales volume in the industry, and it is the best in the pure electric vehicle market.
With the “success” of the joint venture with BAIC, Funeng technology has gained a reputation. In 2018, the company beat top manufacturers such as LG Chemical and Ningde times and won hundreds of millions of orders from Mercedes Benz and Daimler, becoming another “highlight moment” in automobile history.
According to the contract, from 2021 to 2027, Funeng technology will provide Mercedes Benz with a total scale of 140gwh products, equivalent to the battery installed capacity of 2.8 million pure electric vehicles. However, according to the current capacity of less than 2.5gwh, in order to meet the average annual battery supply of 20gwh, it is urgent for Funeng technology to expand its production, which is in urgent need of capital.
Among the luxury car suppliers of multinational car enterprises, Funeng technology has achieved a “qualitative leap” in the history of development. With the cooperation and endorsement of high-end car enterprises, Funeng technology may be able to copy the road achieved by BMW in the past Ningde era and become the overlord of a new generation of power battery.
In the first echelon of power battery, Funeng technology appears to be very “special”: it has only firmly adhered to the technical route of soft pack battery for 11 years. It has been proved afterwards that this kind of “specificity” is very insightful. Soft pack batteries with high energy density are favored by more and more car companies, and Funeng battery, which is the leading technology, is the first choice for its cooperation. Following the “marriage” with BAIC to create good stories in the industry, the “hand in hand” between Funeng battery and dairam will help it increase its advantages in the international market and become a new generation of overlord.
Editor in charge: Tzh