China planning to invest $828 million in solid-state EV battery development

China is planning to take it up a notch concerning EV battery technology. The country is reportedly planning to invest up to six billion yuan ($828 million) in the development of a more powerful & advanced EV battery technology, according to media outlet China Daily.

According to the report, the Chinese government has roped in a few key players in the space like Contemporary Amperex Technology Co. Limited (CATL), the world’s largest battery manufacturer, and automotive companies like BYD and the Zhejiang Geely Holding Group, among others, to lead the program, which was launched earlier this year and is focused purely on advancing the development of solid-state battery technology.

Compared to the current mainstream Lithium-ion battery technology, solid-state batteries are considered to be superior primarily due to their higher power density, durability, and faster charge time. However, to scale up the latter for use in mainstream EVs is not only a technological challenge but significantly costly as well. Full-scale commercialisation of solid-state batteries for use in the EV industry is still pegged to be years away. Given their high production cost, these batteries could initially be restricted to high-end performance/luxury vehicles only.

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Also Read: EU delays decision on Chinese EV tariffs amid election concerns

This news has come out at a sensitive time for global trade relations. Chinese EVs are currently under the radar in the European Union (EU) and the U.S., the latter having accused China of exporting excess inventory as it faces a slowdown in domestic demand. A Reuters report claims the Chinese foreign ministry has even urged the EU Commission to end the probe, calling it "unreasonable" and not in line with international rules. The Commission, which oversees trade policy in the 27-nation European Union, launched an investigation into whether battery electric vehicles manufactured in China were receiving unusually high subsidies and warranted extra tariffs. The Commission has postponed its final decision in the investigation until after the European Parliament election on June 9.

Meanwhile, fearing the imposition of tariffs on its export vehicles, China has already hinted at retaliatory tariffs as high as 25% on imported vehicles with large-capacity engines.