Lithium battery defeat | depth

Original Chao Yi, Qu Mengfan 24 tide 2024-01-16 07:30 Published in Beijing

During the Great Depression of the United States, many people lost confidence in the future, and some even doubted the rationality of the American system. But Roosevelt, then President of the United States, told people: It is not that the profit-seeking free enterprise system has failed in this generation, on the contrary, it has not been tested.

This passage may also be suitable for considering the ups and downs that have occurred or are currently occurring in China's lithium battery industry.

If you study the development history of China's lithium battery industry in depth, you can see that in the past nearly 20 years, China's lithium battery has experienced cycles from myth to nightmare several times. Countless industry star companies collapsed suddenly, and "Titanic phenomena" occurred one after another. It was also in such a passionate era that the Chinese lithium battery business community formed an irrational market operation model and thinking. With the unstoppable investment and expansion impulse surging in the passion, it staged a dramatic story. The rise of China's lithium battery has attracted worldwide attention.

At present, my country has occupied a dominant position in multiple core supply chains of global power and energy storage batteries. For example, in 2022, China's power battery installations accounted for 56.9% of total global sales; energy storage battery shipments accounted for 87% of the world; positive/negative electrode material shipments accounted for approximately 90% of the global market share, and electrolyte shipments The global market share exceeds 85%, and lithium battery separators occupy over 80% of the global market share.

But now it is this kind of crazy gambling and gaming passion that has pushed China's lithium battery industry into a new disorder and blind movement, making today's China's lithium battery industry show a non-linear chaotic trend. Even in a sense, this rampant passion and impulse is destroying our insufficient industry and reform accumulation.

I remember that in 1997, Mr. Wei Jie, an economist in Beijing, once made a prediction. "This is a stage of great waves, and it is very painful. I estimate that in another 10 years, it will not be easy for even one of the 200 private enterprises to survive. There will be collapse and growth."

Running a business can be so brutal. Entrepreneurs in China's lithium battery industry have staged countless exciting brilliance and heart-wrenching declines in the past two decades, and have even demonstrated people's gambling and greed many times. This is also a microcosm of the era of the reckless rise of China's lithium batteries. They thrive and become the founders, pioneers and leaders of the industry; their decline reflects the deformity and fragile business ecology of the emerging industry.

Especially in the past ten years, China's lithium battery industry has experienced at least two rounds of crazy barbaric growth and cruel reshuffle. At the worst point, 1/3 of the companies had been eliminated in less than two years.

Not long ago, according to Xu Jinfu, chairman of Tianci Materials, there are now 89,000 companies in the lithium battery track, and 58,000 new companies have been registered in just one and a half years from 2022 to now. According to statistics from the 24 Trends Industry Research Institute (TTIR) : the production capacity planning of global power and energy storage battery companies in 2025 is likely to exceed 8,000GWh, which is 12.11 times the global sales in 2022.

In addition, the production capacity planning of many core industrial chains such as cathode and cathode materials, electrolytes, and lithium battery separators has exceeded the most optimistic institutional forecast data. Now a new consensus has basically been formed, that is, China's lithium battery industry has entered an era of super overcapacity!

Some even predict that 80% or even 90% of companies in certain core areas of lithium batteries will be eliminated in the future.

Looking back at the ups and downs of star companies that fell in the past, and even the ups and downs of industrial giants, it still has certain reference value now. Wu Xiaobo wrote in "The Great Defeat": In the 40 years of reform and opening up, China's business history has witnessed many ups and downs. Many enterprises were short-lived and never seen again; only a small group of enterprises have bravely stood out to this day. China's business cannot simply be judged by success or failure. Successful companies can inspire us, and failed companies can also wake up latecomers. As the European historian Auguste Comte said: "Knowledge is not foresight, but foresight is part of knowledge." All the mistakes of the predecessors may not be completely repeated, but none of the tragedies that are about to happen will be the same. Exceptions bear traces of previous mistakes.

In this article, the 24Chao team counted 15 representative Chinese lithium battery companies that have gone into "decline" in the past decade or so. Some of them have entered the stage of bankruptcy and liquidation, some are still deep in the quagmire and languishing, and some have gone bankrupt and reorganized. The actual controller has been changed and is being reborn... All the mistakes of the past may not be repeated, but all tragedies that are about to happen will without exception have traces of the mistakes of the past. Just as Mark Twain said: "History does not repeat details, but the process repeats itself." Understanding the darkest moments of the industry also has its own meaning and value.

 (Note: All the information in the full text comes from public information. If there is any inappropriateness, readers and friends are welcome to supplement and correct it)

Recently, Tianjin Jiewei Power Industrial Co., Ltd. (Jiewei Power for short) issued a "Notice on Company Suspension of Work and Production, Employee Holidays and Training" that shocked the industry. The document shows that due to the influence of objective factors such as the market and the upstream and downstream industry chains, in order to ensure the sustainable development of the company's business, the management decided to suspend production starting from December 1, 2023.

A reporter confirmed the authenticity of the above notice from a person related to Gateway Power. However, it stated that not all employees were on leave, but only those who needed to be streamlined. "Because the company has recently had some strategic investors that may come in at the end of the year, so in order to reduce unnecessary expenditures, we have adopted a holiday."

"Depending on the situation of each position, the proportion of people who signed the (leave) agreement is different. For example, the new energy R&D team that attaches great importance to retains 50%. It does not mean that the company no longer wants the remaining people. We are just taking temporary measures to adjust the funding situation. After the war investment comes in, some people will need to sign again."

The reporter once called the public telephone number on the official website of Gateway Power to learn about the situation, but was unable to get through because the other party was out of service due to arrears.

Gateway Dynamics is not unknown. According to the official website, the company was founded in 2009 with a registered capital of 1.218 billion yuan. As one of the first companies to enter the lithium-ion battery field, Gateway Power has a 14-year development history. Since the installation of power products in 2013, it has completed nearly 10 years of market verification, and the longest operating mileage of a bicycle has reached 350,000 kilometers.

In 2022, its market share ranked 11th in the industry. In the first 10 months of 2023, it still ranked 13th in the industry.

According to a report by the Electric Vehicle Observer in April: Gateway Power has deployed four production bases in Tianjin, Yancheng, Jiaxing and Changxing, and other bases are also under active preparation. By 2025, Gateway Power will have a production capacity of 100GWh.

As of the end of June this year, Fosun International (00656.HK) and the funds it manages hold 49.95% of the shares of Gateway Power, making it its largest shareholder. Data disclosed by Fosun International shows that in 2022, Gateway Power's operating income will reach 2.589 billion yuan, a year-on-year increase of 127.22%, and the net profit has not been disclosed.

People close to Gateway Power revealed to Caixin.com that Gateway Power is not yet profitable. The current market competition is fierce and there is no prospect of profitability in the short term. The original investors are unwilling to continue to suffer losses and are planning to change investors. The new investors may adjust their production capacity planning. Before the investor completes the handover, the company decided to temporarily suspend production at some production bases.

Last year, Gateway Power's power battery installed capacity increased by 67.59% year-on-year, reaching 2.43GWh, ranking 11th in the country, with a market share of 0.82%. Gateway Power mainly uses ternary batteries as its main products, and its installed capacity of ternary batteries ranked eighth in the country last year.

Affected by comprehensive factors such as industry destocking and the slowdown in the growth of downstream new energy vehicles, Gateway Power's operating performance has declined significantly this year.

Fosun International disclosed that in the first half of this year, Gateway Power's operating income fell 44.77% year-on-year to 488 million yuan, and the profit was not disclosed. During the same period, Gateway Power's power battery installed capacity decreased by 19.34% year-on-year to 0.73GWh, ranking 12th in the country with a market share of 0.48%.

In the first 10 months of this year, Gateway Power's market share further fell to 0.3%, and its ranking dropped to 13th.

According to a reporter's investigation, Gateway Power's suspension of production has affected its upstream and downstream partners, including raw material suppliers, equipment manufacturers, logistics transporters, etc. Employees of Gateway Power also said that they are worried about the future of the company. They don’t know whether they can resume work on time or whether they can receive wages and subsidies. Currently, they can only wait for notification from the company.

An insider in the lithium battery industry who did not want to be named bluntly told reporters that even if Gateway Power introduces strategic investment in the future, the effect may not be good. "Based on the current situation, Gateway Power's installed vehicle sales during the year may not exceed 1GWh, and global power battery production will exceed 1,000GWh in 2023. Gateway Power's market share is very limited." The person told reporters.

(Source: Financial Associated Press, Daily Economic News, China Business News, Ifeng Finance)

 Rongsheng Meng Guli New Energy Co., Ltd. was formerly known as CITIC Guoan Meng Guli Power Technology Company. It was established in May 2002. It was a subsidiary of CITIC Guoan Guli and headquartered in Beijing. The company specializes in lithium-ion power for new energy vehicles. A national high-tech enterprise that develops and industrializes batteries, lithium-ion batteries for energy storage and key materials for lithium-ion batteries. It focuses on soft-pack laminated power batteries. Its technical route is mainly lithium manganate and ternary batteries. The market is concentrated in Commercial vehicle sector. It is the first power battery company in the world to realize large-scale production and market application of large-capacity manganese lithium-ion batteries.

With the strong rise of the new energy automobile industry, CITIC Guoan Mengli is regarded as the pillar "second curve" of CITIC Guoan. In 2016 and 2017, its net profit exceeded 150 million yuan, accounting for 10% of CITIC Guoan's net profit. 70% of the total. In terms of the ranking of supporting models, CITIC Guoan Mengli was once second only to CATL.

For example, Tianfeng Securities has made statistics on the "10 batches of recommended application catalogs for power battery supporting manufacturers" released by the Ministry of Industry and Information Technology in 2017. In 2017, the number of models supported by CATL reached 378, far exceeding other peers. Ranking second is CITIC Guoan Mengli, with 139 supporting models.

But in 2018, under the influence of multiple factors such as market and policy, Mengguli's own operations were severely impacted, and even fell into a quagmire of losses. According to public reports, Mengguli’s revenue in 2019 was 849 million yuan, but it suffered a loss of 119 million yuan. The situation worsened again in 2020, with its first-quarter revenue of only 47 million yuan and a net loss of 87 million yuan.

At the end of September 2020, Rongsheng Mengli announced that the 30GWh power battery project was launched in Nanjing. The total investment of the project is 12 billion yuan. The construction period is 2020-2025. During the construction period, the main construction of the factory and ancillary facilities, equipment procurement, etc. will be completed. occupy funds.

But less than a year later, in July 2021, Rongshengmeng Guli was exposed to wage arrears. At the beginning of 2022, Rongsheng Meng Guli sent a "Letter of Understanding and Communication Regarding the Salary Payment Issues of Rongsheng Meng Guli New Energy Technology Co., Ltd." to employees and asked employees to sign the communication letter. The content of the communication letter shows that in view of the company's current financial problems, the payment of performance bonuses and overtime pay in October, November and December 2021 is suspended.

The "Bill Eye" mini program data on February 16, 2022 shows that the total number of bills Rongsheng has refused to pay in 2021 has reached 7,607, and the total amount of refused payment has been close to 2.5 billion yuan. In just two and a half months since the beginning of 2022, the total number of bills Rongsheng has refused to pay has reached 521, with a total amount of more than 266 million yuan.

On June 9, 2023, Rongsheng Development (002146.SZ) announced that it plans to purchase a total of 76.44% of the equity of Rongsheng Mengli held by the counterparty through the issuance of shares, and to no more than 35 people who comply with the requirements of the China Securities Regulatory Commission. Specific targets with specified conditions issue shares to raise supporting funds.

Rongsheng Development stated that the company’s current main business is real estate development and sales. In recent years, due to the dual impact of the economic environment and industry situation, the company has faced certain operating pressure. Therefore, the company actively seeks business transformation and upgrading and deploys new energy business. After the completion of this transaction, Rongsheng Mengli will become a holding subsidiary of the company, and the new energy business will become one of the company's main businesses. This transaction will help enhance the company's technological innovation and development potential, enhance the company's asset quality and core competitiveness, and lay a solid foundation for the company's future business transformation and upgrading.

According to Rongsheng Development's disclosure: Rongsheng Mengli achieved operating income of 988 million yuan in 2022, a year-on-year increase of 45.75%, but still suffered a loss of 494 million yuan; as of the end of 2022, the total liabilities were 2.312 billion yuan, and the total asset-liability ratio was 61.05%. However, the scale of capital reserves is only 42.92 million yuan.

Combined with the latest development trends of the industry and the comprehensive strength demonstrated by Rongsheng Mengli itself, the success or failure of this merger may have a profound impact on its future development and potential.

Nearly five months later, on November 8, Rongsheng Development announced that since the transaction plan was disclosed, the company has actively promoted various tasks for this transaction. Due diligence, auditing, evaluation and other work related to this transaction are still in progress. After the relevant work is completed, the company will convene the board of directors again to review the relevant matters of this transaction and perform relevant follow-up procedures in accordance with relevant laws and regulations.

Mengshi Technology is a joint-stock enterprise established in 2001 by Shantou Humei Battery (founded in 1986) . It has more than 30 years of battery manufacturing experience. Around 2010, Mengshi Technology has grown into my country's largest export supplier of motorcycle starter batteries and the world's second largest high-end motorcycle battery market supplier.

It was listed on the A-share market in June 2012, with a market value of 1.125 billion yuan. Three years later (June 2015),  the market value soared to 12.78 billion yuan. It was also this year that Chen Lewu, chairman of Mengshi Technology, proposed the "2351 Strategy", which is to seize the two strategic opportunities of "energy conversion" and "One Belt and One Road"; from a single battery business to high-end batteries, new energy vehicles, Expand in three major areas including clean energy; through the establishment of 5 business units, it will develop into a listed company with a market value of 100 billion by 2020.

In 2015, Mengshi Technology began construction of a 18650 ternary power lithium battery cell factory with an annual output of 400 million pieces invested in Jindu Industrial Zone in Zhao'an, Fujian. "It will support the company's development needs in electric vehicles and energy storage businesses in the future." , to meet different market needs and become one of the major automotive power lithium battery suppliers and major battery energy storage system providers at home and abroad." Mengshi Technology said.

Since then, Mengshi Technology has launched a fierce expansion journey through investment, establishment, acquisition and other methods. Public information shows that when it first went public in 2012, Mengshi Technology had only 3 subsidiaries. By the end of 2017, its subsidiaries had increased to 73. From 2015 to June 2018, it initiated as many as 20 mergers and acquisitions.

In 2017, Mengshi Technology's revenue reached a historical peak of 3.905 billion yuan, while Yiwei Lithium Energy's operating revenue during the same period was only 2.982 billion yuan.

This year (2017) , Mengshi Technology stated in its financial report: "Building lithium-ion battery production projects to support the company's development needs in new energy vehicles and energy storage businesses; building the core competition of Mengshi Technology's automotive power batteries It strives to become one of the core suppliers of domestic automotive power batteries; in addition, it can realize the cascade utilization of power batteries and retire batteries from cars for use in energy storage systems. This has laid the foundation for the company to become a new energy platform-level enterprise in the future. .”

It is understood that in 2017, more than 10 new energy vehicles equipped with Mengshi Technology power batteries have been selected into the "Catalogue of Recommended Models for the Promotion and Application of New Energy Vehicles". According to statistics from Dianchehui, from 2017 to 2019, Mengshi Technology has provided dozens of new energy logistics vehicles and vehicles for more than ten car companies including Dongfeng, BAIC, Weichai, Shaanxi Automobile, Wuling, Kaiwo, Zotye, and Lifan. Passenger car products.

Mengshi Technology, which fought on multiple fronts, failed to withstand the impact of the wave of industrial reshuffle. Since then, it has been trapped in the quagmire of continuous losses and insolvency, and finally ushered in the fate of delisting.

The financial report shows that from 2017 to 2022, Mengshi Technology’s net profit attributable to the parent company after non-deductions has been negative for 6 consecutive years, with a cumulative loss of 6.701 billion yuan in 6 years.

In addition, Mengshi Technology fell into insolvency three times in 2018, 2020 and the end of 2022. As of the end of 2022, its total assets and total liabilities were 4.009 billion yuan and 5.161 billion yuan respectively.

On the afternoon of June 26, 2022, Mengshi Technology announced that the company’s shares have been decided to terminate listing by the Shenzhen Stock Exchange and will be delisted on June 27, 2022.

Tianyancha data shows that Mengshi Technology currently has 10 "final cases" with a total execution target of 572 million yuan, of which 523 million yuan has not been fulfilled. It has been included in the "list of dishonest persons subject to execution."

A generation of capital tycoons has come to an end.

Founded in 2002, Waterma is one of the first domestic power lithium battery companies to successfully develop lithium iron phosphate new energy vehicle power batteries, vehicle starting power supplies, and energy storage system solutions, and is the first to achieve large-scale production and batch application.

Its helmsman (chairman) Li Yao was born in 1973. He served as senior director of BYD's quality department from 1996 to 1999, and then moved to Guangzhou Penghui Battery Co., Ltd. as vice president. In 2002, he led the establishment of Waterma in Pingshan New District, Shenzhen.

After more than ten years of development and growth, Waterma ushered in its peak moment in 2016-2017. According to authoritative statistics from the China Chemical and Physical Power Supply Industry Association, in December 2016, Waterma was shortlisted among the top 500 global new energy companies in 2016. In 2017, it was once again shortlisted for the top 500 global new energy companies.

It was also in 2016 that Jianrui Woneng (stock code: 300116.SZ, now renamed Polyxin) acquired Waterma for 5.2 billion yuan. After acquiring Waterma, Jianrui Woneng shifted its business focus to new energy vehicle power batteries, divested and sold part of its fire protection business, and fully invested in the research and development, production and sales of power and energy storage batteries. In 2017, Waterma Battery brought a net profit increase of up to 1,681 times to Jianruiwo in the first quarter.

In order to accelerate expansion, Waterma also created the "Waterma Alliance" business model. The alliance integrates nearly 200 core companies in the new energy vehicle industry chain and quickly attracts nearly a thousand companies to join the innovation alliance. The alliance requires that after signing a strategic cooperation agreement with the local government, the operating company Xinwo Transport Capacity will provide When an OEM orders a vehicle, the designated vehicle must be equipped with batteries provided by Waterma Innovation Alliance companies.

And Waterma took advantage of this and soared into the sky. According to statistics from Gaogong Industrial Research Institute, in the domestic lithium iron phosphate battery market in 2017, Waterma's market share was as high as 26.6%, second only to CATL and BYD, ranking third in the country. This year (2017), Waterma power battery achieved a production capacity of 15GWh, with actual production of 8.67GWh throughout the year, sales reaching 5.02GWh, and annual sales revenue of 9.425 billion yuan. In 2017, it was once again shortlisted for the top 500 global new energy companies.

At the same time, it continues to make efforts in the field of energy storage. On April 4, 2018, Jianrui Woneng announced that Waterma had recently signed a 975 million yuan sales contract for energy storage batteries with Xi'an Zhongshang Intelligent Technology Co., Ltd. According to Jianrui Woneng's annual report, in 2018, Waterma signed energy storage battery and system sales contracts for Zhongshan Lubo Lighting Industrial Co., Ltd., Xi'an Zhongshang Intelligent Technology Co., Ltd., and China Tower Co., Ltd., with a total contract amount of is 2.259 billion yuan.

According to the positioning and development strategy for the next three years formulated by Jian Rui Wo Energy in 2019: One is to become an industry leader in the energy storage field. It said that "in response to the emerging energy storage market, the company will focus on large-scale energy storage and focus on The company's lithium iron phosphate battery has the potential to be a world leader in cost performance, regardless of cost, technology or scale. The company's cost-effective advantage in lithium iron phosphate batteries is a core competitiveness that is difficult for other peers to copy."

However, Waterma, which was at its peak, eventually fell due to major changes such as overcapacity, new technological changes, and adjustments to subsidy policies. Since 2016, in order to curb the subsidy phenomenon, the government has set a limit for new energy commercial vehicles to have an operating mileage of 20,000 kilometers before they can receive subsidies, which has lengthened the subsidy account period for industrial chain companies such as Jianrui Woneng.

According to data from the Lithium Battery Research Institute of Advanced Industrial Research, by the end of 2017, the total domestic power battery production capacity was 135GWh, and the effective production capacity was 110GWh. The total installed capacity of power batteries is approximately 36.4GWh, which means that the national capacity utilization rate of power batteries is only 40%. Therefore, the competition in the power battery industry market has become more severe.

The real turning point came in 2018. Starting from June 12, the Ministry of Finance officially implemented the new subsidy policy for 2018. Electric vehicles with a driving range of less than 150 kilometers will no longer receive subsidies. Since Waterma's previous core technology was lithium iron phosphate battery, although it has the advantages of high safety and low cost, its disadvantage is also obvious, that is, the energy density is relatively low. Waterma's battery products did not reach the corresponding energy density, and orders plummeted.

By January 2018, Waterma had fallen out of the top ten in terms of installed power battery capacity.

Facts have proved that relying solely on industrial alliances to win orders has not brought much benefit to the company. Moreover, in order to increase its market share, Waterma once borrowed money like crazy, which led to serious problems in the capital chain. Coupled with the fact that Waterma did not keep up with the times to launch ternary lithium batteries, and its batteries repeatedly suffered safety accidents, etc., it eventually went to destruction step by step.

Preliminary verification by the Shenzhen Intermediate People's Court: As of November 7, 2019, Waterma is still in operation with more than 800 employees and external liabilities of approximately 19.7 billion yuan, of which 559 suppliers are owed approximately 5.4 billion yuan in debt. Yuan.

Because Shenzhen Waterma Company cannot pay off its due debts and its assets are insufficient to pay off all debts, the Shenzhen Intermediate People's Court made the following ruling on January 24, 2022: 1. Terminate the reorganization procedures of Shenzhen Waterma Battery Co., Ltd.; 2. Declared bankruptcy of Shenzhen Waterma Battery Co., Ltd.

Tianyancha data shows that Waterma has currently been included in the list of dishonest persons subject to enforcement, with a total of 222 cases involved, 221 of which have not been performed, and the non-performance ratio is 99.5%.

Lixin (Jiangsu) Energy Technology Co., Ltd. (hereinafter referred to as "Lixin Energy") was established in June 2016 with a registered capital of 1 billion yuan. It is a holding company in the new energy field under CITIC Industrial Fund and is mainly engaged in lithium-ion power. R&D, production, manufacturing and sales of energy storage batteries and related supporting products.

Hou Xiaohe, the then president of Lixin Energy, also had a profound industrial background. He graduated from the Department of Electrochemistry of Tianjin University in 1997. Later, as a technical backbone, he was transferred to Tianjin Lishen to participate in the founding work. During the 20 years of working in Tianjin Lishen, he successively served as Tianjin Lishen. Executive Vice President of Shen, General Manager of Lishen Power, etc.

From the beginning, Lixin Energy showed a very fierce offensive momentum. On the day of its establishment, Lixin Energy held a signing ceremony for its lithium battery project with a total investment of 3 billion yuan in Zhenjiang New District, Jiangsu. According to reports, after the project is completed, it will reach an annual production capacity of 3 billion watt-hours of vehicle lithium-ion power batteries and new energy storage battery systems, forming a supporting capacity of 200,000 new energy vehicles and a production supporting capacity of at least 1GWh of energy storage systems.

It also created records such as "it took three months to complete basic reconstruction and product offline, achieve sales of nearly 100 million yuan in half a year, win 10 patents, and 23 domestic and foreign certifications in one year."

At its most glorious moment, Lixin Energy supplied batteries to 21 mainstream vehicle companies including Senyuan Heavy Industry, Sunlong Bus, Beiqi Foton, Asia Star Bus, Jiangling New Energy, and Zhongtong Bus, and supplied a total of 97 new energy models. In 2018, Lixin Energy ranked 13th in the ranking of new energy bus installed capacity among power battery companies.

In addition, Lixin Energy also provides OEM production for CATL, AVIC Lithium Battery, Tianjin Lishen, BYD, etc., with orders and production continuing to be stable. In the field of energy storage, since the establishment of Lixin Energy, the overall installed capacity has reached 460MWh, ranking second in the country in 2019. Overseas energy storage projects have been implemented, providing batteries for the largest energy storage project in North America.