Poor sales, high inventories, and falling lead prices drove Tianneng and Chaowei to drop their electric vehicle battery prices in both April and May. The price of 48V12AH batteries thus slipped to RMB 300/set, while 48V20AH batteries fell to just above RMB 500/set. 

 

Although spot lead prices in China advanced to nearly RMB 14,000/mt with the strengthening in LME lead this month, trading has not improved. Chaowei has responded by cutting prices for a third time this year, but has effectively exhausted this possibility as prices have fallen below costs. Chaowei cut the price of 48V12AH batteries another RMB 5/set to RMB 290/set. The price of 48V20AH batteries was lowered RMB 10-20/set to RMB 490/set. Rather than cut prices, Tianneng has raised rebates to distributors.  

 

The market for electric vehicle batteries is gloomier than ever this quarter, and the low-demand season for the sector made all the more so by the price war between market leaders. Aggressive capacity expansions and sluggish demand are the ultimate causes of this year’s continuous decline in battery prices.

 

Although many other producers of electric vehicle batteries had yet to hear of these price cuts, several indicated their intention to follow suit.