[1] China is a significant producer of lithium batteries and electric vehicles, supported by government policies.
Lithium-ion batteries produced in China are primarily exported to Hong Kong, the United States, Germany, Korea, and Vietnam.
[citation needed] The electric vehicle industry significantly drives the demand for lithium-ion batteries due to their high energy density relative to their weight.
Although in this early stage, there was not much capital invested in the market, most of the research was dedicated to small consumer electronic products such as translators, music players, or cameras.
With all of the varying consumer products, there are different needs for its battery, thus there is not a centralized demand for heavy research in the field.
These policies include providing loans to manufacturers, different tax breaks received by the entire supply line, or invitations for foreign investments and consumption of their battery products.
Currently, the lithium battery industry in China continues to grow under the accelerating trend for electric vehicles, applications in military equipment, 5G services, and more.
Its competitive edge comes from the low labor and production costs which attract foreign companies that can only find more expensive quotes from their local suppliers.
There are currently 72 Chinese companies in the race to produce lithium car batteries with Contemporary Amperex Technology leading with 50% of the market share.
[17] In 2020, 46.5% of lithium battery demand comes from electric vehicles,[18] far exceeding the previous lead of smart mobile devices.
In April 2021, China has reported a total of 8.4 GWh of lithium batteries installed in their electric vehicles, this represents a 134% increase from the year before.
[22] In 2019, Contemporary Amperex Technology has a net income of 39.14 billion yuan with 18% of China's lithium battery exports.
During that year it had more than 32 GWh of lithium battery installation for electric vehicles, placing it first in the world ahead of Panasonic of Japan and LG of Korea.
Contemporary Amperex Technology is a long-time supplier for Tesla, which uses its LFP batteries to build its latest models.
Yet, the largest mines in the world reside in Argentina, Bolivia, and Chile, which often face droughts and have serious demand for fresh water from the local farmers.
[29] As the world starts to act on the climate crisis, many countries have set targets to lower carbon emissions.
While we are searching for alternative energy sources from windmills, solar panels, hydropower, or nuclear fusions, lithium batteries play an important role as storage units for applications such as electric vehicles.