According to the report of January 11 on Wall Street, "the installed capacity of lithium electricity has increased nearly 1.5 times in 2021, and the market has evolved into a competition between China and South Korea?" | the production, sales and installed capacity of major car companies in the power battery industry in 2021 (including Ningde era, BYD, LG New Energy, etc.), annual summary and future important layout are analyzed in detail. This report will further focus on the annual output and installed capacity of power battery duo-ternary battery and lithium iron phosphate battery and a comprehensive comparison between the two in the first part of this report. < pad > < Abstrcat > Continue to conduct a comprehensive comb.

1Ternary will not be replaced by iron lithium, and the cost disadvantage is weakening.

In 2021, the whole market of ternary lithium battery was indeed impacted by lithium iron phosphate battery. After three years' market share advantage of ternary lithium battery to lithium iron phosphate battery, the market share of ternary lithium battery was greatly superior to that of lithium iron phosphate battery.The lithium iron phosphate battery achieved a counterattack in 2021, and the ternary lithium battery was surpassed by the lithium iron phosphate battery in terms of output, sales and installed capacity in the whole year.：

1) output:The annual output of ternary lithium battery was 93.9GWh, an increase of 93.6% over the same period last year, accounting for 42.7% of the total output, which was inferior to that of lithium iron phosphate 125.4GWh, up 262.9% from the same period last year, accounting for 57.1%.

2) sales volumeThe sales volume of ternary lithium batteries for the whole year was 79.6GWh, up 128.9% from the same period last year, accounting for 42.8% of the total sales, which was inferior to that of lithium iron phosphate 106GWh, up 24.5% from the same period last year, accounting for 57.2%.

3) installed capacity:The installed capacity of ternary lithium battery for the whole year was 74.3GWh, an increase of 91.3% over the same period last year, accounting for 48.1% of the total installed capacity, which was inferior to that of lithium iron phosphate 79.8GWh, an increase of 227.4% over the same period last year, accounting for 57.1%.

Wall Street Wisdom Research believes that although lithium iron phosphate batteries perform well in 2021,Ternary lithium battery and lithium iron phosphate battery will continue to coexist for a long time in the future.There is no complete rolling and substitution relationship, only periodic ups and downs, which has been reflected in the share of ternary lithium battery and lithium iron phosphate battery surpassing each other in the past 12 years from 2009 to 2021.

In additionTernary low-nickel batteries, such as 3-series and 5-series batteries, are only slightly higher than lithium iron phosphate in terms of energy density, but their management costs such as thermal runaway are about the same as those of 8-series battery. in the case of a great increase in cost, considering that the performance-to-price ratio is easy to be captured by lithium iron phosphate batteries. ButGradually occupying a ternary share.High nickel, ultra high nickel and cobalt-free ternary batteriesThe competitive advantage in the high-end market is still obvious.The excellent performance can not be matched and replaced by lithium iron phosphate battery.。

而Although more and more car companies are interested in lithium iron phosphate battery, the proportion of high-end brands is still on the low side, and the terminal supporting car companies in 2021 are still mainly focused on$Byd Company Limited (01211.HK) $, SAIC GM Wuling and$Tesla, Inc. (TSLA.US) $The three account for nearly 80%. Even if the lithium iron phosphate battery was first proposed in 2021Tesla, Inc. only uses lithium iron phosphate batteries on standard models worldwide, while other high-performance models such as the high-endurance version, as well as high-end models such as Model X and ModelS, will still use ternary lithium batteries with high nickel and less cobalt, especially its 4680 cylindrical battery will be officially put into use in 2022.

It is worth noting that in terms of material prices for lithium iron phosphate batteries and ternary lithium batteries in 2021, although the absolute value of the price of ternary materials is still higher than that of lithium iron phosphate, the price increase of lithium iron phosphate has far exceeded that of ternary materials, which will weaken the cost disadvantage of ternary relative to lithium iron.. The price of lithium iron phosphate (power type) rose from 40, 000 yuan / ton at the beginning of 2021 to 111000 yuan / ton at the end of the year, an increase of 177.5%. By January 14, it rose again to 126000 yuan / ton. The prices of the three most commonly used models of ternary materials, 523, 622 and 811, rose from 123500 yuan / ton, 145500 yuan / ton and 170000 yuan / ton at the beginning of the year to 248000 yuan / ton, 266000 yuan / ton and 276000 yuan / ton at the end of the year, with increases of 100%, 83% and 62%, respectively.

2In 2022, the international market will face the full introduction of iron and lithium.

2021年，The output of lithium iron phosphate and battery installation have risen sharply, the main reason is that the price of lithium battery upstream raw materials such as four major materials and copper foil mentioned in previous Wall Street research has increased greatly, which makes lithium iron phosphate battery with lower cost and obvious performance-to-price advantage. it also lies in the change of terminal car companies' preference for the power batteries they use, especially the power battery matching changes of popular passenger cars.。

Previously, due to the preference for battery energy density and vehicle range under the subsidy policy, lithium iron phosphate batteries were mainly used in commercial vehicles. Sales of commercial vehicles in 2021 were 186000, an increase of only 46.6% over the same period last year, which lagged far behind the growth rate of 3.521 million passenger vehicles, while the installed capacity of lithium iron phosphate in commercial vehicles was about 10GWh, only a single-digit increase compared with the same period last year. It can be said that the installed capacity is basically the same as that in 2020. However, the installed capacity of lithium iron phosphate in passenger cars has exceeded that of 30GWh, a year-on-year increase of more than 900%, accounting for more than 75% of the total installed capacity of lithium iron phosphate power batteries, which is the main reason for the great increase in the installed capacity of lithium iron phosphate batteries in 2021.

This is reflected in the choice of major domestic and foreign mainstream car companies in 2021. BYD,$XPeng Inc.-W (09868.HK) $、$Geely Automobile (00175.HK) $、$SAIC (600104.SH) $And other domestic car companies, and Volkswagen, Tesla, Inc., Daimler,$F.US (Ford) $International car companies, such as Hyundai and Hyundai, have said that they will introduce lithium iron phosphate batteries, among which representative foreign car companies, such as Tesla, Inc., account for nearly 80% of the sales of lithium iron versions in Model 3 and Model Y currently sold in China. At the same time, the standard endurance versions of Model 3 and Model Y in other markets around the world have also begun to use lithium iron phosphate batteries. BYD, a domestic car company, is a leader in lithium iron phosphate batteries, with the proportion of lithium iron phosphate batteries and ternary lithium batteries in its models rising from 5.5 per cent in 2020 to 9.4 per cent in 2021.

The collective preference of the major terminal car companies has also led to a change of direction among battery manufacturers. Previously, LG new energy and SK innovation, which mainly focus on ternary lithium batteries, also announced their entry into lithium iron phosphate in 2021. On the whole, the top 10 battery manufacturers with the largest installed capacity of power batteries, except Panasonic, have begun to layout lithium iron phosphate batteries.It is obvious that the substantial increase in the installed capacity and output of lithium iron phosphate battery in 2021 is closely related to the change of power battery preference of domestic and foreign automobile enterprises, and the layout of power battery manufacturers is highly related.

Of course, the accelerated trend of lithium iron phosphate in 2021 is mainly concentrated in the Chinese market, the overseas demand for lithium iron phosphate is not so high in China, and it is still dominated by ternary lithium batteries, but this trend is expected to change in 2022.If the output and installed capacity of lithium iron phosphate batteries in the domestic power battery market surpass that of ternary lithium batteries in 2021, then in the new year2022In addition to maintaining its advantages in the domestic power battery market, lithium iron phosphate batteries have always maintained a dominant position in the international power battery market (overseas, whether in the field of energy storage or in the field of new energy vehicles, the proportion of ternary lithium batteries is more than 2/3).A rapid increase in market shareThe possibility of surpassing the ternary lithium battery for the first time cannot be ruled out.

3、2022The Prospect of Ternary and Iron Lithium in

In 2021, the lithium iron phosphate industry chain is almost in a high demeanor for the whole year, but among them, the main players of lithium iron phosphate cathode materials are still German Nano, Hunan Yuneng, Hubei Wanrun and other professional players. The annual output of lithium iron phosphate totaled 410000 tons, an increase of 179% over the same period last year, and the growth rate is almost the same as that of new energy vehicles (cumulative retail sales of 2.989 million vehicles, year-on-year growth of 169.1%), and the overall supply and demand is in a tight balance. But by 2022, there will be a lot of new players coming in and a massive capacity expansion.

Phosphorus chemical enterprises (Chuan Heng shares, Xingfa Group and other companies with upstream phosphorus resources), titanium dioxide enterprises (chemical enterprises with raw materials and ferrous sulfate by-products such as medium nuclear titanium dioxide) and ternary materials companies (Dangsheng Technology, Xiamen Tungsten Xinneng, long-term Lithium, etc.), the production capacity planning is as high as 100,000 tons. Although these phosphorus chemical projects due to the gradual tightening of energy assessment, safety assessment and other approval, the new capacity also has problems such as capacity climbing, and the planned capacity may not come out quickly, but in the long run, there is a possibility of excess supply of lithium iron phosphate.This will have a certain impact on the lithium iron phosphate industry. Once the demand of terminal car enterprises for lithium iron phosphate battery market weakens, it may cause overall overcapacity, especially the high homogenization of the products of the new players, which has no advantage compared with their peers. It is easy to cause vicious competition at low prices.

As for the ternary lithium battery, although it was surpassed by the lithium iron phosphate battery in 2021, there is a great distance in terms of growth.在2022年，4680The introduction of the battery and the high-nickel cobalt-free process are expected to bring opportunities and a substantial increase in the volume of ternary lithium batteries, and comprehensively enhance the proportion of high-nickel ternary lithium batteries in the whole ternary lithium batteries.

In 2021, the output of ternary high nickel materials in China, including NCA and NCM 811, reached about 140000 tons, an increase of more than 260% over the same period last year, while with the supply side, cobalt-free lithium batteries, quaternary lithium batteries with reduced cost and improved performance, and 4680 batteries suitable for high-nickel ternary batteries will be put on the market in 2022, as well as the demand for high-nickel ternary batteries from high-end models and high-end brands of terminal car companies. High nickel ternary lithium battery is expected to continue to grow at a high speed, further occupy the share of medium and low nickel ternary battery, and reverse the lithium iron phosphate battery.