Sunwoda, as a second-tier manufacturer in the industry, has demonstrated a strong growth rate in an environment of accelerated elimination.
Specifically, from January to October 2024, Sunwoda's global power battery loading volume reached 14.3GWh, a year-on-year surge of 68.2%. Its loading growth rate outperformed leading companies such as CATL and CALB, ranking first in the industry.
How did Sunwoda achieve growth against the trend?
First, a differentiated development strategy
Faced with the situation of overcapacity in power batteries and intensified competition in the new energy vehicle market, Sunwoda does not have the advantage of competing with leading companies like CATL in terms of price and cost.
Fast-charging technology is one of the differentiated paths planned by Sunwoda amid fierce competition.
As we know, the fast-charging technology for power batteries is developing rapidly at present, but technologies that have truly reached commercialization level are still relatively scarce, especially high-rate fast charging of 6C and above.
In April 2024, Sunwoda officially launched the Flash Charge Battery 3.0, including the 6C LFP Xinxingchi Battery and 6C NCM Xinxingyao Battery, which can be charged to 80% in just 10 minutes.
Moreover, the company's 4C and 5C charging technologies are mature and have been commercialized. Currently, they have been equipped in some models of Geely, Li Auto and other brands, contributing significantly to the company's growth against the trend.
Of course, this is the result of the company's continuous increase in research and development investment.
Since 2021, Sunwoda's R&D expenses have always remained above 2 billion yuan. In the first three quarters of 2024, they reached 2.268 billion yuan, a year-on-year increase of 13.17%.
Moreover, over the years, the company's R&D expense ratio has remained at around 5.5%, reaching 5.92% in the first three quarters of 2024, surpassing peers such as Gotion High-Tech and Farasis Energy, which fully reflects the company's emphasis on research and development.
Second, full industrial chain layout
As we know, 80% of the cost of power batteries comes from raw materials, mainly resources such as phosphorus, lithium and nickel, while the total cost of labor and manufacturing expenses accounts for 20%.
Therefore, for power battery manufacturers, being able to gain control over upstream resources such as lithium and nickel can largely establish cost advantages.
Since 2019, Sunwoda has gradually expanded its layout upstream and obtained the prospecting right for the lithium mine in the East Taijinar Salt Lake.
Moreover, in 2022, the company jointly built a high-nickel project with Weiming Environmental Protection and other partners. Now, it has realized the integrated layout of the industrial chain, gaining competitiveness in terms of cost and efficiency, which in turn has promoted the contrarian growth of its shipment volume.
In the first half of 2024, the company's power battery business achieved revenue of 6.201 billion yuan, a year-on-year increase of 19.57%, and the revenue proportion also rose to 25.93%, showing a striking growth momentum.
Solid-state batteries
As is known to all, solid-state batteries have no risk of electrolyte leakage and high energy density, making them an ideal choice for the next generation of power batteries.
Industry forecasts suggest that by 2030, the global shipment volume of solid-state batteries will exceed 614GWh, with a penetration rate of 20%, indicating a vast market space.
Since 2015, Sunwoda has been laying out plans for solid-state batteries. According to the existing plan, the company expects to build a 1GWh solid-state battery production line by 2026, and complete the production of all-solid-state battery samples with an energy density of more than 700Wh/kg by 2027.
Moreover, in December 2024, Sunwoda also signed a cooperation agreement with Xiamen Tungsten New Energy Materials, a leading cathode material company, to jointly develop materials such as cathode materials and electrolytes, which will further boost Sunwoda's growth in the field of solid-state batteries.
By then, with the mass production of solid-state batteries, the company's performance is expected to achieve new breakthroughs.
The consumer battery business is Sunwoda's main source of revenue, accounting for approximately 60% of its total revenue all year round.
Since 2010, Sunwoda has seized the opportunity of the rapid growth of smartphones and laptops, achieving leapfrog growth in consumer battery pack products.
It is worth mentioning that in September 2023, Sunwoda stated on the interactive platform of the Shenzhen Stock Exchange that Huawei is an important cooperative customer of the company, and that the company provides mobile phone battery products for Huawei, which confirms the market recognition of its products.
Also relying on strong product strength, the revenue scale of the company's consumer battery packs has ranked first in the world since 2019.
In the first half of 2024, the consumer battery business contributed 13.2 billion yuan in revenue, far exceeding peers such as Desay Battery and Ruixin Holdings, which is very impressive.
Moreover, in the first three quarters of 2024, the self-supply rate of the company's consumer battery cells has exceeded 35%, which is a significant increase compared to 21.3% in 2020 and higher than the industry average of around 25%.
With the improvement of the self-supply rate of battery cells, Sunwoda's cost advantage has been enhanced, offsetting the profit squeeze caused by the "small profits but quick turnover" strategy.
In the first half of 2024, the gross profit margin of this business of the company increased to 18.07%, contributing a gross profit of 2.385 billion yuan, and the profit margin has been further expanded.
