Korean Media: CATL's Net Profit Soars 48.5%, South Korea's Big Three Battery Firms All Report Losses!

On May 22, Korean media outlet The Pioneer Economy published an article stating that analysts believe China's Contemporary Amperex Technology Co. Limited (CATL) has fully taken control of the global electric vehicle (EV) battery market. CATL announced its financial results, indicating that despite a year-on-year negative growth trend in China's EV market during the first quarter of this year, both its revenue and net profit saw significant increases compared to the same period last year.

This stands in stark contrast to the three major South Korean battery companies—LG Energy Solution, Samsung SDI, and SK On—which each reported losses ranging from 200 billion to 300 billion KRW in the first quarter. While South Korean battery firms have recently performed well in the energy storage system (ESS) battery market, their gap in market share within the EV battery sector continues to widen when compared to Chinese competitors.

Even in the emerging field known as "next-generation batteries"—sodium-ion batteries—CATL remains at the forefront. As the global EV battery market increasingly shifts toward lower- and mid-tier models, analysts suggest CATL’s growth momentum is likely to remain strong for some time.

In the first quarter of this year, CATL achieved a revenue of 129.131 billion RMB and a net profit of 20.7377 billion RMB. Compared to the same period last year, sales rose by 52.5%, while net profit increased by 48.5%.

Industry experts generally expect CATL’s annual revenue to reach 541 billion RMB this year, with net profit projected at 88.4 billion RMB. Last year, CATL recorded a revenue of 423.7 billion RMB and a net profit of 72.2 billion RMB—the best performance in its history. Market consensus anticipates that its performance will set new records within a year.

In contrast, all three of South Korea’s top battery companies experienced poor performance in the first quarter. LG Energy Solution announced an operating loss of 207.8 billion KRW for the quarter. Samsung SDI is expected to report an operating loss of around 269.9 billion KRW. Meanwhile, SK On’s expected operating loss for the first quarter reaches 310.8 billion KRW.

Data from SNE Research shows that China’s EV battery usage volume from January to February this year was 69.6 GWh, down 2.0% compared to the same period last year. Nevertheless, CATL still achieved a 6.4% increase in domestic EV battery sales within China.

In the European EV battery market, CATL’s growth momentum is equally impressive. From January to February this year, CATL captured approximately 44% of the European EV battery market share. As the European EV market continues to be dominated by mid-to-lower-end models powered by lithium iron phosphate (LFP) batteries, analysis indicates CATL is becoming the biggest beneficiary.

During January and February this year, CATL accounted for 42.1% of the global EV battery market, including China. In comparison, the combined EV battery market share of South Korea’s three major battery manufacturers dropped from 30.2% in 2021 to just 15% in the first quarter of this year.

Although South Korea’s three battery giants plan to leverage the growing trend of energy storage systems to narrow the gap in market share with Chinese battery companies, analysts note that achieving this goal will by no means be easy.

Last year, CATL sold 167 GWh of batteries for energy storage systems globally, accounting for 30% of total global battery consumption. It is forecasted that CATL’s ESS battery sales will exceed 200 GWh this year.

In contrast, South Korea’s three major battery manufacturers collectively held slightly more than 4% of the global ESS battery market share last year.

Original source: toutiao.com/article/1865893082209498/

Disclaimer: The views expressed in this article are those of the author(s) alone.