Price increase of lithium battery battery 5-15% industry price trend may continue until 2023

The rising tide of shortage of materials in the lithium battery industry chain continues, but the end of the year does not mean that the price increase is coming to an end. On the contrary, a number of news shows that the price of lithium battery will continue to rise.

Battery module factories have been informed that the price of cylindrical lithium battery cells will rise again by 5 per cent and 15 per cent at the beginning of next year due to rising downstream demand for electric vehicles and energy storage, Taiwan's Electronic Times reported yesterday.

According to the latest Bloomberg New Energy Finance (BNEF) survey, the average price of lithium-ion battery packs is now $132 / kWh, down 6 per cent from the same period last year. However, due to increased material cost pressure, the price of battery packs may rise to $135USD / kWh, next year to further slow down the cost reduction process of electric vehicles.

Another report in Taiwan's Electronic Times added that the surge in battery prices will continue until 2023.

The dividing point of electric vehicle cost competition may be delayed by two years.

The above-mentioned "US $132 / kWh" price calculation includes a number of downstream applications, such as new energy vehicles, public transportation, energy storage projects, and so on. In the case of electric vehicles alone, the average price of the battery pack is only $118,118 per kWh, cell and the average price is $97 per kWh.

Although overall battery prices have fallen this year, prices have actually been rising in the second half of the year, according to the authors of the Bloomberg report.

The current price of NMC batteries is nearly $110per kWh,. It is expected that the price of Q4 will be $10 higher than that of Q1 per kWh. As for the lithium iron phosphate battery, which has long been known for its high performance-to-price ratio, it is also difficult to resist the cost pressure in the supply chain. Domestic prices have risen by 10% and 20% since September.

The battery rally will not stop there, and other recent news from the supply chain confirms Bloomberg's prediction that the battery rally will continue next year.

The source pointed out that the first-line battery factory, which previously insisted on not raising prices next year, has also wavered, starting to inform customers to revisit online prices, and the quotation will be raised by about 20%. There are also manufacturers' estimates that prices will rise across the board in 2022.

According to the research report released by Changhong Energy at the end of last month, the company's lithium business demand is strong and orders are full. Although it has raised prices for some products, it "cannot fully cover" the increase in raw material prices, and some price increase orders will not take effect until 2022.

BNEF had predicted that the average price of the battery pack would fall below $100 per kWh, in 2024, when the price and profit margin of electric cars would be the same as those of fuel vehicles, even without subsidies, in other words, more cost-competitive.

However, under the expectation that the average price of the battery (group) will continue to rise, the time point of reaching the $100 dividing line may need to be pushed back another two years to 2026, while the popularity of electric cars, profits of car companies and energy storage projects will all be affected.

Although the implementation time is complicated and confusing, the route of $100,000USD / kWh is still clear. A number of manufacturers have issued the relevant battery technology roadmap this year. For example, Renault and Ford have announced that they aim to reduce the price to $80 / kWh by 2030.