Battery cell supply for electric 2-wheel vehicles falling short

Aaron Lee, Taipei; Willis Ke, DIGITIMES Asia 0

The supply of battery cells for two-wheel electric vehicles (EV) has fallen far short of demand, with suppliers seeing the visibility of customer orders strengthened to mid 2022, according to industry sources.

The shortage centers on cylindrical power lithium batteries widely applied to both four-wheel and two-wheel EVs and hand tools, rather on polymer electrolyte batteries for consumer electronics devices, the sources said.

Batteries now account for over 30% of the production costs for EVs, and cylindrical lithium cells are now the mainstream supply in the market, with shortages seen in all available specs ranging from 18650 to 21700, the sources continued.

The overall supply of such cells has fallen short of demand by up to 100% due mainly to a rapid surge in demand for four-wheel EVs. South Korean makers Samsung SDI and LG Chem are proceeding with capacity expansion of cylindrical power lithium batteries at their plants in Korea and China to meet the demand, and Japan's Panasonic reportedly is installing additional production lines at Nevada, the US to serve Tesla EVs, the sources noted.

Taiwan's battery packs suppliers including Simplo, DynaPack and Celexpert Energy can only gain much smaller capacity support from the leading vendors of cylindrical power lithium cells, as they have little chance to join the four-wheel EV supply chains and have to focus on two-wheel electric motorcycle and bicycle as well as hand tool applications, the sources said.

China-based Bak Power Battery, Lishen Battery and EVE Energy also supply cylindrical power lithium cells, the sources continued, but Taiwanese makers of battery modules remain conservative about placing orders with them and tend to place long-term orders with Korean and Japanese vendors at the request of downstream clients, with the bookings already extending to mid-2022.