CATL's layout in foreign markets -Lithium - Ion Battery Equipment
CATL is a star company in the domestic lithium-ion battery industry. It was established in 2011, and its revenue reached 20 billion yuan in 2017. It was listed on the Growth Enterprise Market on June 11, 2018. The power lithium battery is well-deserved. CATL, which has been steadily rising, has turned a corner after the decline in subsidies for the electric vehicle industry in 2017. According to the 2018 semi-annual performance forecast released by CATL, the company expects that the net profit in the first half of the year will drop by about 50%. Regarding the reasons for the decline in performance, CATL said that the transfer of equity in Beijing Pride Company in the same period last year was affected by the disposal income.(Lithium - Ion Battery Equipment)
Without policy subsidies, where is the way for domestic power lithium battery companies?
CATL is not the first new energy industry company in China to experience a decline in profits. In April, BYD announced its financial report for the first quarter of 2018. While operating income increased by 18% year-on-year, net profit fell by 81.09% year-on-year. In this regard, the reason given by BYD is "the adjustment of the subsidy policy for new energy vehicles and the decline of subsidies".
In May, the top-ranked domestic power lithium battery manufacturer Walter even reported a financial crisis. Relevant announcements show that 8 new bank accounts under the name of Waterma were frozen by the people of Longgang District, Shenzhen, involving an amount of 782,700 yuan. The reason for the freeze was a civil dispute due to the inability to repay the loan when it was due.
In this regard, Waterma’s parent company, Jianrui Wo Neng, announced that due to the adjustment of the national new energy industry policy subsidy, the rapid growth of the subsidiary Waterma’s business expansion, and the slow collection of accounts receivable, it caused tension and other factors. As a result, the net profit of the subsidiary Waterma fell short of expectations.
With the gradual decline of national new energy subsidies, the technical standards for applying for subsidies have also been raised accordingly. This has a huge impact on battery companies. In particular, companies like CATL enjoy a 15% preferential tax rate for national high-tech companies in addition to subsidies. With the tightening of relevant advantageous industrial policies, how to maintain profitability has become a thorny issue faced by everyone.
Accelerating overseas layout and expanding market share, battery companies know how to "take for the country and use it for food"
CATL is the first domestic power lithium battery company to become a supplier of international car companies, and has recently reached strategic cooperation with many car companies. In 2014, CATL, which had supplied batteries for Apple, was spotted by BMW and became the only battery supplier for BMW at that time. These two cooperations became the endorsement of CATL's subsequent cooperation with first-class car companies. At present, SAIC, BAIC, Geely, Dongfeng, Changan, BMW and Volkswagen are all CATL customers.
Recently, BMW said that it has reached a purchase agreement with CATL, and will purchase about 32 billion yuan of batteries from CATL in the next few years. Not long ago, BMW just announced the signing of an order worth 1 billion euros (about 7.7 billion yuan) for automotive lithium-ion batteries with CATL. Turning around, the order has increased by 3 billion euros. Allegedly, of which 1.5 billion euros of products will be produced by CATL's new plant in Thuringia, Germany.
The German factory was just started in early July this year. CATL signed an investment agreement with the Thuringia state government. CATL will invest about 1.9 billion yuan to set up a battery production base and an intelligent manufacturing technology research and development center in Erfurt, Thuringia, Germany. According to German media data, 90% of the power lithium batteries of German car companies currently come from my country, because it is difficult and uneconomical to build self-built battery factories.
The battery factory and the OEM have in-depth cooperation and mutual support. From the perspective of the pattern, it will greatly help the future revenue growth of both parties. At present, many companies in the domestic new energy industry chain have problems such as unstable performance and unsmooth capital circulation, and the overall trend is declining. Based on this situation, the advantages of establishing a joint venture factory for CATL are obvious: first, through cooperation with powerful companies in the industry chain, it is conducive to expanding the company's market share; second, it can be recognized by powerful car companies, and also Illustrates the industry status of CATL.
Without policy subsidies, where is the way for domestic power lithium battery companies?
CATL is not the first new energy industry company in China to experience a decline in profits. In April, BYD announced its financial report for the first quarter of 2018. While operating income increased by 18% year-on-year, net profit fell by 81.09% year-on-year. In this regard, the reason given by BYD is "the adjustment of the subsidy policy for new energy vehicles and the decline of subsidies".
In May, the top-ranked domestic power lithium battery manufacturer Walter even reported a financial crisis. Relevant announcements show that 8 new bank accounts under the name of Waterma were frozen by the people of Longgang District, Shenzhen, involving an amount of 782,700 yuan. The reason for the freeze was a civil dispute due to the inability to repay the loan when it was due.
In this regard, Waterma’s parent company, Jianrui Wo Neng, announced that due to the adjustment of the national new energy industry policy subsidy, the rapid growth of the subsidiary Waterma’s business expansion, and the slow collection of accounts receivable, it caused tension and other factors. As a result, the net profit of the subsidiary Waterma fell short of expectations.
With the gradual decline of national new energy subsidies, the technical standards for applying for subsidies have also been raised accordingly. This has a huge impact on battery companies. In particular, companies like CATL enjoy a 15% preferential tax rate for national high-tech companies in addition to subsidies. With the tightening of relevant advantageous industrial policies, how to maintain profitability has become a thorny issue faced by everyone.
Accelerating overseas layout and expanding market share, battery companies know how to "take for the country and use it for food"
CATL is the first domestic power lithium battery company to become a supplier of international car companies, and has recently reached strategic cooperation with many car companies. In 2014, CATL, which had supplied batteries for Apple, was spotted by BMW and became the only battery supplier for BMW at that time. These two cooperations became the endorsement of CATL's subsequent cooperation with first-class car companies. At present, SAIC, BAIC, Geely, Dongfeng, Changan, BMW and Volkswagen are all CATL customers.
Recently, BMW said that it has reached a purchase agreement with CATL, and will purchase about 32 billion yuan of batteries from CATL in the next few years. Not long ago, BMW just announced the signing of an order worth 1 billion euros (about 7.7 billion yuan) for automotive lithium-ion batteries with CATL. Turning around, the order has increased by 3 billion euros. Allegedly, of which 1.5 billion euros of products will be produced by CATL's new plant in Thuringia, Germany.
The German factory was just started in early July this year. CATL signed an investment agreement with the Thuringia state government. CATL will invest about 1.9 billion yuan to set up a battery production base and an intelligent manufacturing technology research and development center in Erfurt, Thuringia, Germany. According to German media data, 90% of the power lithium batteries of German car companies currently come from my country, because it is difficult and uneconomical to build self-built battery factories.
The battery factory and the OEM have in-depth cooperation and mutual support. From the perspective of the pattern, it will greatly help the future revenue growth of both parties. At present, many companies in the domestic new energy industry chain have problems such as unstable performance and unsmooth capital circulation, and the overall trend is declining. Based on this situation, the advantages of establishing a joint venture factory for CATL are obvious: first, through cooperation with powerful companies in the industry chain, it is conducive to expanding the company's market share; second, it can be recognized by powerful car companies, and also Illustrates the industry status of CATL.
