Chinese electric vehicle manufacturers are rapidly entering the hybrid market, with companies like Li Auto and BYD expanding their offerings. The introduction of the 4680 cylindrical battery comes at a timely moment for this shift.
As the new year of 2025 begins, Li Auto is excited to announce its goal of delivering 500,508 new energy vehicles in 2024. Since the start of its deliveries, the company has cumulatively delivered 1.1339 million vehicles over five years, the majority being range-extended models. Other manufacturers such as Geely, Great Wall, Chery, GAC, Dongfeng, SAIC, and Leap Motor are also investing in range-extended and PHEV models, competing directly with Li Auto and BYD. Even XPeng, which is often associated with smart technology, is not an exception.
This competitive landscape is driven by the projection that new energy vehicle production and sales will approach 13 million units in 2024, with a market penetration rate for new energy passenger vehicles reaching 47.9%. In the second half of the year, this rate is expected to exceed 50% for five consecutive months. By the end of the year, pure electric vehicles will account for 60% of sales, while range-extended and PHEV models will make up 40%. However, in the latter half of the year, the share of range-extended and PHEV models is projected to grow to 56% in 2025.
As a result of this trend, orders for short-blade batteries from Honeycomb Energy have surged, while BYD has iterated its long blade battery into a long and thin version that includes fast-charging capabilities. The mass production of the 4680 cylindrical battery this year illustrates the profound transformation of the Chinese new energy vehicle industry from a policy-driven market to a consumer-oriented one.
More manufacturers are now focusing on range-extended and PHEV models. Back in April 2019, during the Shanghai Auto Show, I predicted that once subsidies for pure electric vehicles ended, range-extended and PHEV models would become mainstream as they effectively address range anxiety and provide a better overall experience. Initially, many attendees were skeptical of this view. In August 2020, during Li Auto’s user day, founder Lee Xiang became emotionally charged and directly rebutted critics of range-extending powertrains.
Reflecting on it now, we see that BYD’s sales began skyrocketing from the second half of 2020 when it started mass production and delivery of its third-generation DMI plug-in hybrid models. Following this, a series of successful models from BYD, Li Auto, and others led many automakers to embrace range-extended and PHEV technologies. It is expected that over 8 million such vehicles will be produced and delivered by 2025.
In response, most manufacturers are adopting a business strategy focused on maximizing cost-effectiveness and cost control, often referred to as “fuel and electricity at the same price.” Some manufacturers even suggest that “electricity is cheaper than fuel.” This strategy necessitates that both the total vehicle cost and operating costs are highly economical.
As the new energy vehicle industry rapidly evolves, the importance of power batteries as a core component is increasingly highlighted. From a functional perspective, power batteries serve as the primary energy carriers. Analyzing costs, they represent the largest portion of new energy vehicle expenses. Therefore, achieving an optimal balance between cost and energy efficiency becomes essential for battery manufacturers.
As automakers shift towards range-extended and PHEV models, they impose new demands on battery suppliers. These demands extend beyond performance to include achieving higher cost-effectiveness and efficiency. Thus, battery manufacturers must optimize production costs while ensuring performance meets the high standards set by vehicle manufacturers.
In discussing battery solutions for range-extended and PHEV models, the focus centers on three critical dimensions: cost optimization, power performance enhancement, and battery standardization. The primary goal is to achieve extreme cost optimization while maintaining low energy configurations (15-35 KWh batteries) and innovating to lower overall cost structures. Secondly, to enhance power characteristics under low energy conditions, it is necessary to develop high-efficiency battery technologies that can maintain or even improve vehicle power output performance despite lower energy states.
To fully leverage the advantages of mass production, battery standardization becomes indispensable. This strategy facilitates broader adaptability and flexibility, allowing battery designs to flexibly meet various vehicle requirements while enhancing the freedom of solution choices, thus better serving the diverse needs of the range-extended and PHEV markets.
Power batteries used in range-extended and PHEV applications must balance extreme cost control, outstanding power performance, and highly standardized designs to ensure they meet both economic demands and provide excellent driving experiences while maintaining high production and application flexibility.
The five advantages of cylindrical batteries stand out in optimizing range-extended and PHEV systems. The optimization of range-extended and PHEV systems in the new energy vehicle sector is crucial for achieving efficiency and cost-effectiveness. This core task revolves around two main aspects: the design and manufacturing optimization of the battery cells themselves, and the refined control of performance management and cross-level strategies under low energy states.
- Safety: The intrinsic safety of cylindrical batteries stems from their structural design. The cylindrical shape provides natural safety, with a steel shell design that can withstand over 10 MPa of pressure, three times that of square batteries. Tesla’s 4680 battery features a tab-less design that allows gas to be directed out through a bottom pressure relief valve in the event of thermal runaway, preventing the entire battery pack from catching fire.
- Standardization: The key to reducing costs and improving efficiency for manufacturers lies in the standardized design of cylindrical batteries, which offers significant benefits. For instance, BMW’s 4695/46120 battery size can fit both sedan and SUV models, with a single certification covering all products and reducing research and development time by over 30%. EVE Energy’s “One cell for all” concept, through unified cell dimensions, helps automakers reduce battery certification costs by 70%. Standardization also promotes collaboration across the supply chain, exemplified by Keda’s development of components for the 46 series, which reduces costs by 20% using pre-plated nickel thin-wall stretching technology.
- Cost Efficiency: The revolutionary breakthrough in mass production is that the manufacturing efficiency of cylindrical batteries is 10 times that of square batteries. Yunshan Power’s magnetic suspension production line achieves a speed of 75 PPM (75 cells per minute), lowering the investment cost per GWh by 25%. EVE Energy’s D-line efficiency reaches 120 PPM, with a yield rate of 97%, reducing costs by 30% compared to square batteries. In terms of material costs, the tab-less technology reduces the amount of current collector used by 40% and decreases copper foil consumption by 35%.
- Fast Charging Capability: The experience revolution of charging at the same speed as refueling. The tab-less technology reduces the internal resistance of cylindrical batteries to 2.5 mΩ, a 90% reduction compared to traditional batteries. Yunshan Power’s 46 series batteries support 6C fast charging, with a 10%-80% charge taking just 8 minutes and 45 seconds. BMW’s cylindrical batteries can add 300 kilometers of range in just 10 minutes under an 800V platform. Tesla’s 4680 battery, through its tab-less design, achieves a peak charging power of 250 kW, enabling a 5-minute charge for 250 kilometers of range.
- No Expansion: Ensuring reliability throughout the battery’s lifecycle. The design of cylindrical batteries avoids the expansion issues seen in square batteries. EVE Energy’s cylindrical batteries show no noticeable deformation even after 197,000 kilometers and have a cycle life exceeding 3,000 times. Yunshan Power’s 46 series batteries employ vacuum gradient pressure technology, reducing electrolyte wetting time to 24 hours.
The mass production practices of cylindrical batteries in the industry show promise. According to industry information, numerous power battery companies are now in mass production of cylindrical batteries:
- Tesla: As a technology leader, Tesla’s 4680 battery features a tab-less design with an energy density of 300 Wh/kg and supports 6C fast charging. Although initial mass production yielded a 30% efficiency, innovations in dry electrode processes and integrated die-casting technology are expected to boost capacity beyond 50 GWh by 2025. Their battery packs utilize CTC (Cell to Chassis) technology, enhancing the range of Model Y by 16% and reducing production costs by 54%.
- BMW: Exemplifying high-pressure range extension, BMW’s sixth-generation eDrive technology incorporates the 4695/46120 cylindrical batteries, enhancing energy density by 20% and supporting an 800V high-voltage platform. EVE Energy supplies the DTE/DTP batteries, utilizing high-nickel ternary materials to enable 10-minute charging for an additional 300 kilometers of range, with a planned domestic production capacity of 20 GWh by 2026.
- EVE Energy: As a pioneer in mass production, EVE Energy’s cylindrical batteries have been installed in vehicles from Chang’an and JAC, accumulating over 197,000 kilometers of travel. Their 46 series batteries have seen yield rates rise from 80% to 97%, with an annual production capacity of 10 GWh at their facility in Jingmen, Hubei, and plans for three production lines in Hungary by 2026. In the range-extended sector, their lithium iron phosphate cylindrical batteries are compatible with 50 kWh systems, supporting 300 kilometers of electric range.
- Yunshan Power: As a disruptor with tab-less technology, Yunshan Power’s 46 series batteries have an internal resistance as low as 0.6 mΩ and a system energy density of 280 Wh/kg. Their magnetic suspension production line achieves a production efficiency of 75 PPM, reducing the investment cost per GWh by 25%. The first phase of their 1.5 GWh production line is set to launch in 2025, with a daily capacity of 75,000 cells, catering to both passenger and commercial vehicles.
- Samsung SDI: As the leader in cylindrical battery mass production in South Korea, Samsung SDI has initiated production of its 4695 cylindrical batteries (diameter 46mm / height 95mm) at its factory in Tianan, South Chungcheong Province, outpacing LG Energy and SK On. The batteries are being packed at their Vietnam facility and will ultimately be delivered to customers in the U.S. for micro-mobility applications.
The advantages of cylindrical batteries in terms of safety, standardization, cost efficiency, fast charging capabilities, and lifecycle reliability align perfectly with the needs of range-extended and PHEV models. The successful mass production of these batteries by numerous companies is expected to inject new momentum into the new energy vehicle industry and contribute to outstanding performance.
According to the technology adoption lifecycle curve, the penetration of new energy vehicles in China has now reached the early mainstream stage, targeting pragmatists who make up 34% of the market. The next stage involves the conservatives, who also account for 34%. Together, these two consumer groups represent 68% of the market, marking a critical battleground for new energy vehicles where patience will be key. In this phase, the growth of range-extended and PHEV models becomes an inevitable reality.
Ultimately, whether through the 4680 cylindrical batteries, short-blade batteries, or square batteries, the industry must find the best balance between cost and energy efficiency.
