China Imposes Restrictions on Export of Electric Car Battery Technologies

Strategic Insights -

China's Ministry of Commerce announced a new requirement for licenses to transfer eight key technologies crucial for producing inexpensive electric cars abroad. This move could strengthen China's dominance in the electric car market and limit the ability of Chinese electric carmakers to set up factories overseas, as the European Union has been pressing them to do. The restriction on battery technologies comes after Beijing restricted the export of seven kinds of rare earth metals and the magnets made from them less than three months ago. Chinese manufacturers, particularly BYD and CATL, have achieved significant breakthroughs in making inexpensive batteries with considerable driving range for electric vehicles.

Key Takeaways:

  • The Chinese government will require government licenses for any effort to transfer abroad eight key technologies for manufacturing electric vehicle batteries.
  • The new license requirement could make it harder for Chinese electric carmakers to set up factories overseas, as the European Union has been pressing them to do.
  • Chinese manufacturers BYD and CATL have achieved significant breakthroughs in making inexpensive batteries with considerable driving range for electric vehicles.
  • The restriction on battery technologies comes after Beijing restricted the export of seven kinds of rare earth metals and the magnets made from them less than three months ago.
  • China has close to 50 graduate programs that focus on either battery chemistry or the closely related subject of battery metallurgy, whereas only a handful of professors in the United States are working on batteries.
  • The new license requirement will affect the transfer of three core technologies of lithium iron phosphate batteries and five key technologies for producing lithium for all kinds of batteries.
  • Lithium iron phosphate batteries were invented nearly 30 years ago in the United States, but Chinese manufacturers BYD and CATL have made significant improvements to their recharge capacity and mass production.
  • China's Communist Party leadership has chosen scientific training and education as one of the country's top economic priorities, with a focus on areas such as chemistry.

Statistics:

  • China has nearly 50 graduate programs focusing on battery chemistry and metallurgy.
  • Only a handful of professors in the United States are working on batteries.
  • China has restricted the export of seven kinds of rare earth metals and the magnets made from them less than three months ago.
  • The new license requirement will apply to the transfer of three core technologies of lithium iron phosphate batteries and five key technologies for producing lithium for all kinds of batteries.
  • BYD has made a technological breakthrough five years ago when it improved the lithium-ion batteries using inexpensive iron and phosphate chemistry.
  • Lithium iron phosphate batteries now command more than half the global market and are made almost entirely in China.
  • The European Union has been pressing Chinese automakers and battery manufacturers to set up operations in the bloc as an unofficial condition for continued growth in sales of Chinese cars there.

Sources:

  • "China Imposes Restrictions on Export of Electric Car Battery Technologies" by The New York Times, without date.
  • "China's Communist Party leadership chooses scientific training and education as top economic priority" by The New York Times, without date.
  • "China hosts nearly 50 graduate programs in battery chemistry and metallurgy, compared with just a handful of U.S. researchers in the field" by The New York Times, without date.
  • "CATL displays 5-minute recharge battery at Shanghai auto show" by The New York Times, April 18, 2023.
  • "BYD's factory in Xinin, China, in 2021" by Qilai Shen for The New York Times, without date.
  • "China's graduate programs in battery chemistry and metallurgy" by Qilai Shen for The New York Times, without date.