Benzinga - by Anan Ashraf, Benzinga Editor.
China is reportedly set to allocate more than 6 billion yuan ($830 million) to a state-led initiative aimed at advancing solid-state battery technology, in addition to its recent investments aimed at bolstering its domestic semiconductor industry.
What Happened: Six firms are eligible to receive state funding to work on the solid-state battery technology, Reuters reported, citing a person familiar with the matter. Battery maker and Tesla, Inc. (NASDAQ:TSLA) supplier CATL, Nio, Inc.-backed (NYSE:NIO) WeLion New Energy Technology, BYD Co Ltd. (OTC:BYDDY) (OTC:BYDDF), FAW, SAIC, and Geely Automobile Holding’s (OTC:GELYY) are the potential participants of the project.
Compared to traditional lithium-ion batteries that use flammable liquid electrolytes, solid-state batteries offer enhanced safety, longer lifespans, and faster charging. However, widespread adoption has been hindered by challenges in raw material availability, complex manufacturing processes, and high costs, the report noted.
Why It Matters: While the upfront cost of research is significant, analysts predict a domino effect. Increased investment in R&D will encourage companies across the entire EV supply chain to ramp up their own efforts. This could ultimately unlock a multi-trillion yuan market and contribute to global sustainability goals.
Nio’s semi-solid-state battery, unveiled in 2021, marked a significant step forward, while CATL is targeting small-scale production of all-solid-state batteries by 2027. Sunwoda, another Chinese battery maker, claims to have developed all-solid-state batteries with energy densities exceeding 400 Wh/kg, according to the report.
Earlier this week, it was reported that China set up its largest-ever semiconductor investment fund with Big Fund III, having collected 344 billion yuan (about $48 billion).
Earlier this month, President Joe Biden hiked tariffs on an array of Chinese imports including EV batteries, steel and aluminum, and solar products. The government imposed a 100% tariff on electric vehicles made in China, quadrupling it from the previous 25%.
The U.S. also implemented a 25% tariff on electric vehicle batteries from China and a 25% tariff on critical minerals that go into making these EV batteries.
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