Why do Chinese power lithium-ion battery companies 'go to sea' in Europe?

Recently, news of my country's power lithium battery companies setting up factories and investing in Europe has continued. On November 2, Kodali announced plans to establish a wholly-owned subsidiary in Hungary and invest no more than 30 million euros to build the first phase of the Kodali Hungary processing base. In addition to Hungary, Kodali has also established wholly-owned subsidiaries and processing base projects in Germany and Sweden. Yesterday, it was reported that Envision AESC, a power lithium battery company under Envision Technology Group, plans to build a super battery plant near the Nissan Sunderland plant, and a feasibility study by the British government for this plan is underway. It is reported that the company's current annual output of batteries in Sunderland is 1.9GWh. Previously, Envision AESC's parent company Envision Technology has stated that Europe is one of the important markets for global electric vehicles in the future. Envision Technology attaches great importance to future European market opportunities and is actively considering new plants in Europe. Among these European companies that 'go overseasIn July 2018, CATL signed an investment agreement with the state government of Thuringia, Germany, and planned to invest 240 million euros (approximately 1.9 billion yuan) to establish a battery processing base and intelligent manufacturing technology research and development in Erfurt, Thuringia center. The battery processing base is mainly engaged in the research and development and processing of lithium batteries. It will be constructed in two phases. It is planned to be put into operation in 2021 and will form a production capacity of 14GWh after it reaches production in 2022. That year, BMW announced that it had signed a 4 billion euros power lithium battery order with CATL. In June 2019, CATL announced a new investment in the European processing and Ru0026D base project, raising the total investment to no more than 1.8 billion euros (approximately 14 billion yuan). In October of that year, the overseas plant officially started. In November 2019, BMW signed an order of 3.3 billion euros with CATL, bringing the total order to 7.3 billion euros. At the same time, CATL has also signed long-term cooperation agreements with mainstream European car companies such as Daimler, Volkswagen, Bosch, and Volvo. In November 2019, Funeng Technology and Daimler signed a power lithium battery supply agreement from 2021 to 2027. The total supply of power lithium batteries is 140GWh in 7 years. According to public information, Funeng Technology has determined that it will invest in a new battery plant in Germany to ensure the supply of Daimler and other auto plants. A few days ago, Funeng Technology also reached a cooperation with the European OEM company TOGG, agreeing to use Funeng batteries in all TOGG vehicle product lines. It is reported that the power lithium battery cell will be supplied by Funeng Technology, and the battery module and Pack will be jointly developed and processed in Turkey. In July 2019, Honeycomb Energy announced that in the next five years, it will deploy a global production of 100GWh power lithium battery projects. Among them, it will spend 2 billion euros (approximately 15.7 billion yuan) to build a 24GWh large-scale power lithium battery plant, supporting cathode material plant and battery technology center in Europe. According to analysis, the first phase of Honeycomb Energy's European plant will be completed and put into operation in 2022, and the second phase of the project will be put into operation in 2025. In July of this year, the new European headquarters of Weihong Power and the processing plant of the lithium battery system plant in Germany were completed. The plant plans to start the first processing line in March 2021 to supply battery modules and battery packs to the company’s European customers. . The total investment in the first phase of the plant project reached 43 million euros (about 340 million yuan). The initial plan is to produce 1.5GWh per year, and the production will be expanded to 6GWh in the later stage. So why did these battery companies choose to invest in Europe? The reason for choosing Europe is that the industry believes that the direct reason for attracting Chinese companies to invest in Europe is its huge market demand. Data show that in the first half of this year, European new energy vehicle sales exceeded 400,000, a year-on-year increase of 52%. Other agencies predict that in the next 10 years, the compound growth rate of electric vehicles in Europe will reach 28%, and the compound growth rate of demand for power lithium batteries will reach 34%. In addition, Europe is accelerating the process of electrification. According to statistics, 26 of the 27 EU member states have formulated relevant policies to encourage the development of electric vehicles. In order to maintain their advantages in the future competition, European OEMs such as Volkswagen, Audi, and BMW have formulated a clear electrification development strategy, which will inevitably lead to a large number of power lithium battery procurement requirements. There are still many uncertain factors in the European market. It is a good opportunity for Chinese battery companies, and we also have the strength to compete with European companies. However, some experts reminded that the cost of domestic companies to invest in Europe is about three times that of domestic projects, and there are many uncertain factors. It is necessary to do a good job in overall planning, as well as to optimize the design in many aspects such as process flow, equipment system integration, plant planning, dangerous goods storage, safe passage, etc., and find a reasonable solution. In short, in the future, more and more Chinese battery companies will participate in international competition. If they want to gain a firm foothold in Europe, they must also improve their own strength in products, technology and other aspects, so that they can have more words in the market. right. Disclaimer: Some pictures and content of articles published on this site are from the Internet, please contact to delete if there is any infringement