A few days ago, CATL released its first-quarter 2022 performance report. During the reporting period, CATL achieved a total operating income of 48.678 billion yuan, a year-on-year increase of 153.97%; a net profit attributable to the parent company of 1.493 billion yuan, a year-on-year decrease of 23.62%; and a net profit of 977 million yuan after deduction, a year-on-year decrease of 41.57%.

　　Image source: Screenshot of the first quarter financial report of CATL in 2021

　　It is worth noting that while the net profit of CATL is declining, its operating costs are rising significantly. The financial report shows that the operating cost of CATL in the first quarter was 41.628 billion yuan, a year-on-year increase of 198.66%.

　　The pressure on profits in the first quarter is due to the soaring prices of raw materials

　　Ningde Times said that there are two main factors for the increase of cost: one is the increase with sales growth; the other is the rapid increase in the price of some upstream materials, which causes the cost to increase.

　　The rapid growth of the downstream new energy vehicle market has boosted the demand for upstream power batteries. According to data from the China Automobile Association, in the first quarter of this year, the cumulative sales volume of new energy vehicles was 1.257 million, a year-on-year increase of 1.4 times, and the market share reached 19.3%. According to data from the China Automotive Power Battery Industry Innovation Alliance, the total installed capacity of power batteries in my country in the first quarter of this year was 51.3GWh, a year-on-year increase of 120.7%.

　　Under the rapid increase in demand on the demand side, the trend of rising power battery raw material prices has gradually emerged since 2021, and will be further strengthened in the first quarter of this year. Relevant data shows that at the beginning of 2022, the price per ton of battery-grade lithium carbonate and battery-grade lithium hydroxide will increase by nearly 8 times compared with the same period of the previous year, and the price per ton of spodumene and lithium hexafluorophosphate will increase by about 4 times. The prices of primary materials, lithium iron phosphate materials, and ternary battery electrolytes have also soared several times.

　　Statistics from the China Association of Automobile Manufacturers show that rising raw material prices have directly led to an increase of more than 40% in the comprehensive cost of battery materials. If the cost pressure brought about by the increase in raw material prices last year was mostly absorbed by OEMs and battery companies, then this year, this pressure has been transmitted to the terminal. According to incomplete statistics, since the first quarter of this year, more than 30 new energy vehicle companies have raised the prices of models on sale, ranging from a few thousand yuan to 30,000 yuan.

　　In the first quarter performance interpretation meeting, Jiang Li, secretary of the board of directors and deputy general manager of CATL, said frankly, "The price increase of lithium carbonate since 2021 has brought pressure to the company's operations, but as a leading enterprise of power batteries, in order to maintain the industry Before the first quarter, we shouldered the pressure of raw material price increases, but the price of raw materials represented by lithium carbonate is indeed rising very fast, the company negotiated with customers to jointly face the pressure of raw material price increases."

　　In fact, not only in the Ningde era, the continuous rise in upstream raw material prices has brought a lot of pressure to midstream battery companies. Judging from the first-quarter performance reports released by a number of lithium battery companies, there is generally a state of "increasing revenue without increasing profits". For example, although the operating income of Yiwei Lithium Energy and Guoxuan Hi-Tech increased by 127.69% and 203.14% respectively, their net profit fell by 19.43% and 32.79% respectively; the loss of Funeng Technology also expanded to 244 million yuan.

　　Supply and demand relationship is expected to improve in the second half of this year

　　Regarding the abnormal price of upstream raw materials, Ye Shengji, chief engineer and deputy secretary-general of the China Association of Automobile Manufacturers, said that this round of raw material price increases were not only due to the imbalance between supply and demand, but also the phenomenon of hype and price hikes in some intermediate links. He pointed out that through the active coordination of government departments and the development cycle and laws of the industry itself, the price of power battery materials will gradually return to normal and rational.

　　On April 19, at the press conference of the State Council Information Office, the relevant person in charge of the Ministry of Industry and Information Technology said that it will moderately speed up the development of domestic resources, and work with relevant departments to resolutely crack down on unfair competition such as hoarding and price gouging, and promote the return of new energy vehicle raw material prices as soon as possible. reason.

　　In order to ensure the supply and cost of raw materials, battery companies also continue to deploy in the upstream field.

　　Taking Ningde Times as an example, since 2018, it has formed close ties with upstream companies through strategic cooperation, investment, and signing of long-term agreements around lithium batteries. The cooperative manufacturers cover lithium ore, nickel ore, cobalt ore and other mineral resources. Developers, manufacturers of cathode materials, anode materials, separators, electrolytes and other lithium battery materials and suppliers of customized equipment have gradually formed a relatively complete supply chain system.

　　Jiang Li revealed, "At present, CATL is strengthening the mining of the core minerals of lithium batteries with its partners, but the mining of mineral resources takes a certain amount of time. In the future, with the gradual release of production capacity, the price drop is an inevitable trend. We judge In the second half of this year, the supply situation of some battery materials will improve."

　　This article is reproduced from Gasgoo