Analysis: Samsung Note7 pit behind the Korean lithium battery factory

Recently, a friend of the author encountered something strange. Previously, he was in the middle of a plug-in hybrid car when he was studying for a driver's license. He actually stopped production recently. Prior to this, the model can not pick up any major problems in terms of reliability, market reputation and safety. But it can't be bought at once.

Analysis: Samsung Note7 pit behind the Korean lithium battery factory

After many inquiries, the seller gave an explanation: Since the Samsung Note7 mobile phone has been exploding due to the spontaneous combustion of the battery, the Ministry of Industry and Information Technology does not allow the automobile manufacturer to produce Korean batteries. The company is currently arranging a new lithium battery supplier, and it will not arrive so soon, so it will be temporarily discontinued. It doesn't matter, just wait for a new supplier's battery parts to arrive!

Analysis: Samsung Note7 pit behind the Korean lithium battery factory

Good guy, a mobile phone design flaw leads to "self-ignition door", the lithium battery pack of the electronic product and the lithium battery of the vehicle power system are also things that gossip can't. Samsung Electronics has actually smashed the supply of billions of South Korean lithium batteries to China! However, is it so amazing?

Analysis: Samsung Note7 pit behind the Korean lithium battery factory

Netizens used the famous game "GTA 5" to spoof the Samsung Note7 picture - the phone actually became a grenade

However, looking at the problem is nothing more than a representation! Below, the author carefully analyzes the underlying reasons for this -

As early as the era of personal portable electronics before the rise of the concept of new energy vehicles, Samsung and LG relied on its predictive dumping policy to rule the Chinese lithium battery market for many years. However, what really makes Korean companies earn a lot of money is still after the promotion of the new energy automobile industry in China.

Relying on government subsidies and tilting policies, domestic new energy vehicles are developing rapidly. The market demand for lithium battery components, which are indispensable in the industry, is also growing. This gave the Korean company that first occupied the Chinese market with the convenience of “near water tower”.

Analysis: Samsung Note7 pit behind the Korean lithium battery factory

The rise of lithium batteries in South Korea is inseparable from the explosive growth of China’s “cottage phone era” personal electronic products.

Over the years, Korean lithium battery companies, including LG Chem and Samsung SDI, have not only tried their best to increase the production capacity of local companies, but have also settled in China to set up joint ventures or wholly-owned lithium battery factories. As an important supporting equipment with high added value, the lithium batteries produced by Korean companies are well-suited to meet the huge demand in the Chinese market, and they also bring hundreds of millions of profits to their production enterprises.

Originally, with the current attitude of the South Korean government toward China, the relationship between China and South Korea seems to be very good. The two sides signed a free trade agreement and announced industrial synergy. However, a shadow called "Sade" has been lingering over the relationship between the two countries. In the first half of this year, South Korea announced that the relationship between the two sides began to turn sharply after the deployment of the "Thade" (THAAD) system on the peninsula due to the threat of North Korean missiles.

Analysis: Samsung Note7 pit behind the Korean lithium battery factory

The Sade system is known for its defense system, but its radar is powerful enough to spy on China's targets. It has become a camera hidden in your door, directly jeopardizing China’s national security.

Analysis: Samsung Note7 pit behind the Korean lithium battery factory

The signed agreement, of course, will not be abolished. But now, the good days of Korean companies are indeed coming to an end.

As early as March 24, 2015, the Ministry of Industry and Information Technology has launched the "Regulations for the Standardization of Automotive Power Battery Industry", which will be implemented on May 1, 2015. At that time, the Ministry of Industry and Information Technology adopted the voluntary declaration test of enterprises, and the test was qualified to be listed in the “New Energy Vehicle Promotion and Application Recommended Model Catalogue”. From January to April 2016, the Ministry of Industry and Information Technology has released three batches of enterprise catalogues, a total of 25 companies.

The catalogue was initially unintentional, but it was just like a quality product recommendation list. At this stage, there is no additional benefit to listing, which is a pure product honor for the company. At the same time, because the application for testing requires the supply of battery cells and battery systems for related tests, the cost is high and time-consuming, so many companies do not pay attention. Samsung SDI and LG Chem, along with the consistent reputation and mastery of self-produced products in China, adopted an attitude of “doing more than one thing”.

However, everything ended on April 29 this year.

Analysis: Samsung Note7 pit behind the Korean lithium battery factory

Lithium battery packs powered by Samsung SDI and LG Chemical. Relatively speaking, LG is also one of Tesla 's battery suppliers, which is relatively unsightly as Samsung.

Analysis: Samsung Note7 pit behind the Korean lithium battery factory

On the same day, the Ministry of Industry and Information Technology issued a supplementary notice on the enterprise declaration work in line with the "Regulations on the Standards of the Automotive Power Battery Industry", which rigidly linked the battery new national standard and the new energy vehicle promotion catalogue, which is equivalent to the mandatory standard and became a power battery enterprise to enter the new energy automobile market. The threshold must pass. Immediately after the release of the new energy subsidy policy adjustment plan in May, it was generally interpreted as being associated with the catalogue. This has led to the phenomenon that power battery companies have “grabbed” the fourth batch of catalogues. At this time, LG and Samsung realized that the big thing was not good, and they rushed to apply.

However, this kind of temporary attitude and the current political environment after the two countries’ economic and trade relations may still pass.

On June 20th, the fourth batch of catalogues was announced. A total of 31 companies were approved, but there were no LG and Samsung. The official explanation for LG and Samsung is that the reason why the power lithium battery failed to enter the catalog is that the product safety is temporarily unable to meet the standard. Moreover, foreign-funded battery companies want to enter the catalogue, in addition to product testing to meet the requirements, but also to meet the requirements of local construction and equipped with R & D personnel. To this end, both companies have accelerated their work in building factories in China, hoping to be approved in the next batch of catalogues. At this time, the South Korean government announced that it will deploy the Sadr anti-missile system, which is equivalent to pushing LG Chem and Samsung SDI into a desperate situation.

Analysis: Samsung Note7 pit behind the Korean lithium battery factory

Samsung Electronics’ “self-ignition door” is famous, so it is inevitably over-exaggerated by the public...

It happened that during this time, the Samsung Note7 spontaneous combustion incident with huge public influence broke out... So, for the public, it is not surprising that the “Samsung mobile phone pits the lithium battery in Korea”.

Any problem that companies should not ignore

The author learned from an industry insider that the fourth batch of power battery catalogs is not the last, but it has a watershed significance. First of all, in the previous four batches, most of the powerful companies have been short-listed, and it will become more and more difficult to enter. Second, due to the failure to gain access to the catalog, the catalogue will be implemented at the end of the year. This is bound to cause two Korean battery manufacturers to suddenly lose the Chinese market and will suffer huge losses. On this occasion, coupled with Samsung SDI's previous establishment in Nanjing, LG Chem established a plant in Xi'an, the total investment of the two factories is close to 1 billion US dollars. Once it is unable to enter the catalog, it will inevitably make it difficult for its products to gain a share in the Chinese market. This series of losses can be described as extremely heavy.

The economy has always been linked to politics, and the countries of the world are no exception. As a company, especially a multinational enterprise, it should have a keen political sense.

Imagine that as early as last year, Samsung SDI and LG Chem completed the qualifications for entering the catalog early, and today they are easily evicted from the Chinese market because of such "low-level" reasons.

What is almost certain now is that if the South Korean government does not stop deploying the Sade system, or does not make satisfactory concessions and compromises in China in other areas, then Samsung and LG’s names will not be much May be printed on the business directory of the Ministry of Industry and Information Technology...

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