CITIC Securities released a research report stating that solid-state batteries, due to their high safety and energy density, are expected to initiate a new round of electrification innovation cycle.
According to the Futu Securities app, CITIC Securities released a research report stating that solid-state batteries, due to their high safety and energy density, are expected to initiate a new round of electrification innovation cycle. Since 2024, the Chinese solid-state battery industry has seen marginal changes such as the launch of semi-solid-state production models and a penetration rate of 1% for semi-solid-state batteries, signaling the start of industrialization.
CITIC Securities estimated that consumers are willing to pay a premium of 0.1-0.15 million yuan for longer battery life, which will help solid-state batteries penetrate the power battery market. According to our calculations, global demand for solid-state batteries will reach 643GWh by 2030, with a CAGR of 133% from 2024 to 2030, and a total market space of 1.2 trillion yuan. Looking at the global market, Japan is currently more advanced in the research and development of solid-state batteries, but China has advantages such as low technical risk, a fast-paced approach, and abundant conditions for industrialization. China is expected to come out on top in the second half of the industrialization of both semi-solid-state and solid-state batteries. China's lithium battery industry will continue to lead the world and enter a new golden age.
The main points of the Citic Securities research report are as follows:
Taking history as a guide, solid-state batteries are initiating a new round of innovation cycle.
We review the development of China's electric vehicle industry and summarize four key signals for industrialization: government funding support, entry of key players, affordable prices, and increased penetration rate of new products. Since 2024, solid-state batteries have continued to accumulate positive signals: government support is expected, semi-solid-state production models are launched, and the penetration rate of semi-solid-state batteries reached 1% in the first half of 2024. Analyzing the range and price of popular models, we find that long-range models command premium prices due to their luxury attributes and scarcity, making them an important market space for solid-state batteries. Taking into account the mid-to-high-end electric vehicles, consumer electronics, and eVTOL applications, we estimate that global demand for solid-state batteries will reach 643GWh by 2030, with a penetration rate of 12.2%, of which we predict a solid-state penetration rate of approximately 1%, with a total market space of around 1.2 trillion yuan.
Compared to Japan, China's 'fast and steady' approach is expected to win in the second half of industrialization.
Japan's advantage lies in research and development. Japan's solid-state battery field has national-level research institutions and financial support, and the top three global solid-state battery patents belong to three Japanese companies: Toyota, Sanyo, and Panasonic. Toyota completed road testing of solid-state batteries in 2020, leading the global market by over 5 years.
China's advantage lies in industrialization. Firstly, Japan's bet on sulfide solid-state batteries carries risks, while China prioritizes oxide semi-solid-state batteries for mass production and simultaneously develops routes such as sulfide/halide/composite electrolytes to share the risks. Secondly, Japan plans to use solid-state batteries in hybrid electric vehicles (HEVs) first and then in battery electric vehicles (BEVs), while China chooses to take small steps by first using semi-solid-state batteries in vehicles and gradually transitioning to solid-state batteries. Our calculations show that China's transition route has a scale effect five times greater than Japan's. In terms of industrial conditions, China has a complete lithium battery industry chain and the world's largest consumer market for electric vehicles, which is expected to help China win the second half of the industrialization of semi-solid-state and solid-state batteries.
Industry chain reconstruction: China's lithium battery industry chain actively embraces new development opportunities.
In the short term (2024-2026), the mass production of semi-solid-state batteries will bring relatively high revenue elasticity to high-nickel ternary materials, carbon nanotubes, and other links. In the medium term, by 2030, our calculations show that the impact of semi-solid-state and solid-state batteries on separators and electrolytes will be limited, at 1% and 6.6% respectively. In the long term, facing the trend of solid-state battery industrialization, we select representative sample companies to illustrate the development opportunities. Traditional battery manufacturers are expected to lead the industry with their advantages in research and development, customers, and manufacturing. Material suppliers can only pass through the cycle if they actively transform themselves, while third-party material suppliers can seize new development opportunities through their resource endowments. Finally, we project the evolution and reconstruction of the lithium battery industry landscape, predicting that solid-state batteries will continue to develop and gradually dominate the market, and that China's lithium battery industry is expected to continue to lead the world and usher in a new golden age.
Investment strategy:
Unexpected changes in the technological roadmap of new energy vehicles; policy changes in the domestic and international new energy vehicle industry fell short of expectations; the progress of mass production and installation of solid-state batteries fell short of expectations; the development and cost reduction of solid-state battery technology fell short of expectations.
Investment strategies.
We believe that the industrialization of semi-solid-state and solid-state batteries has already begun in 2024, and China is expected to win in the second half of industrialization. The domestic lithium battery industry chain is expected to gain new development opportunities. We focus on three main themes: 1) battery manufacturers with leading technology; 2) targets in the semi-solid-state battery industry chain that are expected to deliver certain performance in the short term; 3) targets in the entire value chain of the solid-state battery industry.