EV Battery Technology: The demand for electric vehicles (EVs) is growing rapidly worldwide, but China's recent tough policy has setback this growth. China has now banned the export of important technologies related to EV battery manufacturing and lithium processing.
This decision can have a direct impact on EV production of countries like India, America and Europe. "Now these technologies can be exported only after getting a license from the government." - Statement of China's Ministry of Commerce
China's new ban has a direct impact on Lithium Iron Phosphate (LFP) battery technology. These batteries are considered low-cost, quick-to-charge and safe.
According to 2023 data, China's share in LFP battery manufacturing was 94% and in lithium processing 70%.
This means that China has almost complete control over this cheapest and most popular segment of EV batteries, which it now wants to retain.
According to research firm SNE, about 67% of the EV batteries sold worldwide are made by Chinese companies.
Major companies include CATL, BYD, and Gotion. CATL supplies batteries to giants like Tesla, and also has plants in Germany, Hungary, and Spain. In 2024, BYD overtook Tesla to become the world's largest EV company.
This is not the first time that China has banned technology exports. Earlier also it has imposed restrictions on the export of rare earth materials and magnets, which are used in EVs, electronics and defense equipment.