The Lithium Battery Equipment Investment Layout Of CATL

What does the decade from 2011 to 2021 mean for CATL?

Something can be seen from several keywords: leading position of the industry, stable growth of performance, more perfect industrial layout, and locking in large orders.

By the end of 2021, the market value of CATL had reached 1.37 trillion yuan; 

In 2021, the global market share will be 32.6%, making it the world's largest power battery supplier for five consecutive years.

In 2021, the revenue will reach 98 billion yuan, a year-on-year increase of 94.8%; 

The net profit is expected to reach 10.8 billion yuan, up 93.5% year on year.

There are 10 production bases in the global layout; 

It is estimated that by the end of this year, the total production capacity of CATL will exceed 200GWh;

The production capacity will exceed 600GWh in 2025;

Won the big order of 57GWh from Zhejiang Yuanjing Automobile Parts Co., Ltd. under Geely;

The order of 15GWh from Fisker from the United States in three years in total;

ELMS orders from American commercial electric vehicles company;

5-year order from Chongqing Sokon New Energy Automobile Co., Ltd.

At present, taking advantage of the development of new energy vehicles, power battery enterprises are speeding up the pace of enclosure, and the industry competition is becoming increasingly fierce.

In this case, many power battery enterprises will increase their capacity planning in 2021. For example, SVOLT plans to reach 600GWh by 2025, Gotion High Tech plans to achieve 300GWh in 2025, and CALB Tech plans to exceed 500GWh during the 14th Five-Year Plan period.

As an industry giant, CATL also revealed that the production capacity will exceed 600GW in 2025. To this end, CATL "prepared crazily" to accelerate the improvement of the upstream and downstream ecological layout of the industrial chain.

According to the announcement of CATL, as of September 30, 2021, CATL has invested in 75 enterprises with a total subscribed amount of 15.46 billion yuan. Among them, 48 enterprises are long-term equity investments with a total subscribed amount of 10.97 billion yuan. These enterprises are distributed in power batteries, energy storage, lithium battery materials, lithium battery intelligent equipment manufacturing, charging, automatic driving, new energy vehicles, chips, semiconductors, and other fields.

Among them, there are 7 intelligent equipment manufacturing enterprises directly or indirectly invested by CATL, namely: Lead Intelligent, Golden Stone Solar, Mentechs Intelligent Equipment, Anmai Times, Lead Micro, Nebula Electronics, and Lyric Robot. It is worth mentioning that CATL indirectly participated in the dividend of Lyric Robot by indirectly holding the shares of Chendao Capital.

Below, we will give a brief introduction to these intelligent equipment manufacturers.

Lead Intelligent is a new energy equipment manufacturer and service provider. Its business covers eight fields, including lithium battery intelligent equipment, photovoltaic intelligent equipment, 3C intelligent equipment, intelligent logistics system, automobile intelligent production line, hydrogen energy intelligent equipment, laser precision processing, and machine vision.

On January 27, 2022, Lead Intelligent released a performance forecast, which is expected to make a profit of 1.45 billion to 1.65 billion yuan in 2021.

Golden Stone Solar is mainly engaged in the R&D, manufacturing, sales, and comprehensive services of HDT high-efficiency solar cell industrial production equipment and the "turnkey project" of the whole production line, involving solar cells, heterojunction, an amorphous silicon layer, amorphous silicon film, and other technical fields.

Recently, Golden Stone Solar has undergone industrial and commercial changes, with new shareholders including BYD Co., Ltd; The registered capital increased to about 215 million yuan, an increase of about 12.81%; The business scope includes the manufacturing of special equipment for semiconductor devices, the manufacturing of photovoltaic equipment and components, and the leasing of photovoltaic power generation equipment, etc.

Mentechs Intelligent Equipment is an intelligent manufacturing system solution provider, which has five business divisions: automobile equipment, new energy equipment, customized furniture cloud manufacturing, intelligent warehousing and logistics, and general industry.

Anmai Times is jointly invested in and established by Hangzhou AMIS Intelligent Technology Co., Ltd., and CATL. Of which CATL accounts for 49%. Its business scope includes manufacturing and sales of intelligent basic manufacturing equipment, sales of intelligent material handling equipment, etc.

Lead Micro is a global high-end equipment manufacturer, focusing on the development, design, production, and service of advanced film deposition and etching equipment. With atomic layer deposition technology (ALD) as the core, the company's business covers semiconductors, photovoltaic, LED&MEMS, flexible electronics, new energy, and other industrial fields.

Nebula Electronics is a high-tech enterprise specializing in R&D, production, and sales of lithium battery pack testing equipment, lithium battery pack intelligent manufacturing solutions, fuel cell testing, intelligent manufacturing solutions, energy storage intelligent converters, and charging piles.

Lyric Robot is a national high-tech enterprise focusing on research, development, and manufacturing of high-end equipment, which mainly provides digital intelligent whole plant solutions for leading enterprises in three major industries: new energy (lithium battery, photovoltaic, hydrogen energy), automobile, and ICT.

In 2021, Lyric Robot was listed successfully. In 2021, Lyric Robot's net profit will be 215 million yuan, up 53.42% year on year.

Why did CATL invest in the above lithium battery equipment enterprises?

From the perspective of the invested equipment enterprises, they all have certain R&D and technical strength in the field of new energy batteries, which helps to ensure the stable supply of core production equipment in CATL and thus enhance its core competitiveness and technological innovation ability.

Starting from CATL itself, the power battery industry in which it is located has three core competencies: 

1. product material research and development; 

2. Accumulation of production process; 

3. Industrial chain integration capability. 

When the industry develops to a certain scale, the cost will be a very important link to determine the competitive advantage of enterprises. Therefore, it will test the industrial chain integration ability of enterprises.

Lithium battery equipment is an important part of improving battery performance and improving the operating efficiency of battery plants and is the core process of power battery production. Under the trend of global electrification, lithium battery equipment manufacturers with global leading technological competitiveness and continuous R&D and innovation capabilities will become strategic resources of the new energy vehicle industry chain.

Over the years, CATL has supported lithium battery equipment manufacturers to a certain extent. When the products of CATL are recognized by the market, their equipment suppliers are also recognized, thus fully driving the development of the industrial chain.

At present, Chinese lithium battery equipment enterprises have made breakthroughs in product cost performance, revenue scale, profitability, delivery capacity, and R&D investment. Lithium battery equipment manufacturers that have obtained investment from CATL will also form a closer "bundling" relationship with CATL and broaden the supply chain moat of CATL. At present, in addition to the basic localization of equipment procurement, "the battery production process of the company is also being replaced by localization."

According to previous public information, Lead Intelligent, Hangke Technology, Nebula Electronics, Yinghe Tech, Han's Laser, Haimuxing Laser, HNAC Technology, Funeng Oriental, Colibri, Lyric Robot, etc. are all lithium battery equipment suppliers of CATL.

With the acceleration of global electrification of Tesla, Volkswagen, BMW, and other auto enterprises, the battery supply gap will continue to expand, and the market also ushered in a new round of power battery capacity expansion cycle. If power battery enterprises want to win large orders from many terminal vehicle enterprises, they must expand capacity, reduce costs and improve quality. Therefore, it has become an important plan for each power battery enterprise to first include the core equipment manufacturers in the industrial chain.

In the past, although CATL had certain integration capabilities in the industrial chain and carried out the corresponding layout, in the face of changing and complex market environment, it seems far from enough to achieve the goal of "breaking 600GW of production capacity by 2025" and reduce the hidden troubles of the supply chain.

This also means that the powerful equipment manufacturers who have not entered the layout of CATL are expecting the "olive branch" of CATL.