Sodium-Ion Battery Cathode Competition and Cooperation New Situation: New Forces "Win by Speed", Lithium Battery Giants "Enter by Volume" [SMM Analysis]

SMM August 26 News:

With the successive commissioning of NFPP 10kt-level production lines and sodium-ion battery cathodes entering the scale-up delivery phase, the landscape of industry participants is becoming increasingly clear: on one side are startup sodium-ion battery enterprises with mature R&D and flexible mechanisms, and on the other side are major lithium battery cathode players entering with capacity and brand endorsement. These two types of entities compete and cooperate on the same track, and their differentiated characteristics will profoundly influence the competitive landscape and cost-reduction pace of sodium-ion battery cathodes.

I. Logic of Entry for Two Types of Entities

Currently, new sodium-ion battery forces have completed construction or commenced production of 10kt-level production lines, while major lithium battery cathode players have completed technical reserves and accelerated their entry. The two types of entities are gradually shifting from "offset competition" to "head-on confrontation."

II. Startup Enterprises: Mature R&D, Flexible Mechanisms

The core advantages of startup sodium-ion battery enterprises are mainly reflected in three aspects.

First, mature R&D. New sodium-ion battery forces often originate from university research teams or industry veterans, with high technical starting points and focused roadmaps. They are jointly initiated by leading scholars in the electrochemistry field, and their product performance is at the industry's leading level. Their "lightweight" technical organizational form enables R&D iteration speeds significantly faster than those of major players.

Second, flexibility and short decision-making chains. Startup enterprises have flat organizational structures, allowing quick decisions on R&D project initiation, production line adjustments, and business decisions. They can optimize formulas and processes based on client feedback in a timely manner, demonstrating clear efficiency advantages in sample delivery verification, customized development, and other stages, aligning with the early-stage characteristics of sodium-ion batteries: "small batches, multiple varieties, fast iteration."

Third, significant room for price adjustments. To capture limited client resources and order shares, startup enterprises are willing to adopt more aggressive pricing, using volume discounts to quickly scale up. According to SMM, some new force enterprises offer highly competitive quotes during the capacity ramp-up phase to secure initial energy storage clients.

However, the shortcomings of startup enterprises are equally prominent: limited financial resources, capacity expansion reliant on external financing, and weak risk resistance. Once the industry enters a price war or downstream demand fluctuates, their cash flow pressure will appear first.

III. Major Lithium Battery Cathode Players: Capacity Expansion and Brand Endorsement

Compared to startup enterprises, the advantages of major lithium battery cathode players entering sodium-ion batteries are concentrated in two aspects: capacity and brand.

On one hand, they have the ability to rapidly expand capacity. Major players possess mature production line construction experience, supply chain systems, and financial strength. The LFP production line shares process similarities with sodium-ion polyanion technologies, and equipment is largely interchangeable, enabling rapid modification and replication of production lines. The speed of commissioning 10kt-level capacity far exceeds that of startup enterprises.

On the other hand, the brand endorsement effect is significant. Leading cathode enterprises have accumulated deep client trust and quality management systems in the lithium battery field. Their sodium-ion battery products naturally enjoy a trust premium during certification by downstream battery manufacturers, with low channel reuse and client acquisition costs, making it easier to secure bulk orders from leading energy storage clients.

In addition, large manufacturers have stronger risk resistance. The cash flow from their main lithium battery business can "transfuse" their sodium-ion battery operations, enabling them to expand countercyclically during industry downturns, buying time for future growth.

IV. Coopetition Landscape and Market Outlook

SMM believes that in the early commercialization stage, startups seize the first-mover advantage with mature R&D and flexible decision-making, racing to capture the client validation window. As the market size expands, large manufacturers' capacity expansion and brand advantages will be gradually released.

Meanwhile, the coopetition relationship between the two types of players will also deepen. Large manufacturers may integrate the technical teams of new forces through toll processing, mergers and acquisitions, while new forces may leverage large manufacturers' supply chains to reduce costs. Ultimately, entities with multiple endowments of "technology + capacity + capital" will prevail in long-term competition.

SMM New Energy Research Team

Wang Cong 021-51666838

Ma Rui 021-51595780

Feng Disheng 021-51666714

Lyu Yanlin 021-20707875