BYD, a major Chinese electric vehicle manufacturer, officially launched its “Megawatt Flash Charging” technology on Monday, March 17. This innovative charging solution boasts a peak charging speed of 1 kilometer per second, enabling drivers to recharge up to 407 kilometers of range in just 5 minutes, comparable to the refueling efficiency of traditional gasoline vehicles. The following day, NIO announced a strategic partnership with CATL, marking the beginning of a competitive landscape involving fast charging and battery swapping technologies, according to recent reports from US media.
As reported by Fortune China, BYD and CATL are significant rivals in both the power and energy storage battery sectors. Last year, BYD’s global shipments of power batteries ranked second only to CATL, with a market share difference of approximately 20 percentage points. In the energy storage battery market, BYD holds the third position globally, trailing CATL by a similar margin.
Analysts believe that the promotion of “Megawatt Flash Charging” technology will drive a comprehensive upgrade of the new energy vehicle (NEV) industry chain. The first area of focus is the innovation in battery materials; materials such as silicon-carbon anodes and carbon nanotubes are crucial for enhancing lithium-ion migration rates, thus becoming key variables in fast charging batteries. Secondly, there is a growing demand for upgraded charging infrastructure, including liquid-cooled ultra-fast charging stations and high-voltage connectors, which will require modular designs to reduce costs.
However, this technology faces challenges related to grid compatibility. A critical question arises: can the grid support such high peak loads during operation? Without accompanying energy storage systems and smart scheduling technologies, the scalability of this technology may be limited, leading to substantial cost pressures.
During the launch event, BYD also officially commenced pre-sales for the Han L EV and Tang L EV, priced between 270,000 to 350,000 yuan and 280,000 to 360,000 yuan, respectively. Notably, the pre-sale price for the Han L EV is nearly 90,000 yuan higher than the current Han EV, reflecting the substantial costs associated with the comprehensive kilovolt architecture overhaul. Clearly, BYD aims to leverage economies of scale and technological cost reductions to accelerate the market penetration of “Megawatt Flash Charging”, while this situation provides some breathing room for other manufacturers.
On March 18, NIO and CATL announced their battery swapping strategic partnership, with CATL planning to invest approximately 2.5 billion yuan in NIO Energy. The two companies intend to create the world’s largest battery swapping network and jointly promote the formulation and adoption of national standards for battery swapping technology, facilitating cross-brand and cross-model battery compatibility.
According to the cooperation agreement, CATL will support the development of NIO’s battery swapping network, and NIO’s future vehicles under the Firefly brand will incorporate CATL’s battery swapping standards and infrastructure. The two companies plan to cover diverse markets through a “dual network” approach.
Following this announcement, NIO’s stock, which had been underperforming, surged by over 16% at one point on Tuesday, before settling to around a 9% gain, indicating some market skepticism regarding the collaboration.
Reports suggest that while this partnership will undoubtedly enhance the efficiency of the battery swapping model, the widespread adoption of BYD’s ultra-high voltage fast charging could directly encroach on the market space for battery swapping, potentially explaining the timing of the announcements from NIO and CATL.
Furthermore, CATL’s collaboration with NIO Energy, rather than NIO Automotive, is seen as a risk diversification strategy. This approach acknowledges that NIO Automotive is still navigating challenges. Additionally, other automakers are expected to partner with CATL to develop models based on its battery swapping stations, ensuring that regardless of NIO Automotive’s fate, CATL’s battery swapping network will have a viable future.
Currently, NIO has established a total of 3,172 battery swapping stations, exclusively for use by NIO vehicles. In contrast, CATL focuses on its “Chocolate Battery Swapping” service, which features modular battery replacements that resemble chocolate in shape. This service reportedly allows for battery swaps in as little as 78 seconds, primarily targeting mid-range and low-end vehicles.
