China: CATL To Invest $280 Million In New LFP Cathode Materials Plant

Roskill: In 2021, the market share of LFP cathode materials is forecast to increase to 25%.

CATL, together with its subsidiary Shenzhen Dynanonic, signed an agreement with the Jiang’an county government in Sichuan province in China to build a new lithium iron phosphate (LFP) cathode materials plant.

The investment is quite significant – roughly $280 million – and the plant should be completed within three years (we guess that at least part of it might start production much earlier).

“CATL has invested heavily in LFP battery production. Besides the expansion of connections with downstream clients, CATL has been actively moving towards an upstream position to gain a source of captive LFP cathode materials. This would grant the company a strong foundation to deal with the impending changes to the global Li-ion battery market.”

The scale of the investment in LFP cathode materials indicates that this type of lithium-ion battery has a promising future in electric vehicles.

According to Roskill, LFP accounted for about 20% of the global lithium-ion market in 2020. In China, in particular, LFP expanded by 21% year-over-year to 24.4 GWh. The forecast for 2021 is – 25% share for LFP, globally!

Since the LFP is one of the least expensive lithium-ion batteries, they do not contain cobalt, and have plenty of advantages, including long cycle life, they are very compelling for multiple applications. Sure, the energy density is far behind some other types, but the cell-to-pack approach improved the overall energy density to a point where even the entry-level Tesla Model 3 Standard Range Plus is now offered with CATL’s LFP batteries.

Interestingly, in November 2020, the Model 3 with LFP batteries were the most popular MIC Model 3 in China.

Source:Roskill via Green Car Congress

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