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Recently, BYD officially announced that the company is steadily moving forward with the spin-off and listing of the power battery business, which is expected to be spun off and listed independently around 2022.

In fact, this is not the first time that BYD has said that it will spin off the power battery business. as early as last year, BYD founder and chairman Wang Chuanfu said that BYD is working on the divestiture of the power battery business. the spin-off is expected to be completed by the end of 2018 or early 2019, and BYD's power battery business will be listed independently in 2022-2023.

So why does BYD, which is already a leader in the domestic new energy automobile industry, split up the power battery business? From the perspective of the company's internal system, splitting the battery business will help to reduce the pressure on the company's financial operation, share the cost of the battery business, and reduce the financial risk of the enterprise, which is also what the larger domestic new energy vehicle companies are generally doing. From the perspective of the external battery market, the independent listing of the split battery business is conducive to the rapid expansion of the battery business and increase its share in the market.

Currently, BYD has five power battery plants in Chongqing, Changsha, Shenzhen, Huizhou and Qinghai, and another Xi'an battery plant is under construction. According to BYD's plans, BYD will have an annual battery production capacity of 60GWh by 2020. Although BYD continues to invest in power battery production, its market share in the battery market is not as large as that of suppliers such as the Ningde era. In July this year, the installed capacity of power batteries for new energy vehicles in China was about 3.34GWh, of which Ningde era accounted for 40.72% of the total installed capacity with 1.36 GWh, firmly ranking first, while BYD ranked second with 0.83 GWh installed capacity, accounting for 24.7%.

The battery business lags far behind in market share, making BYD eager to spin off the battery business so as to accelerate its expansion. However, according to the current situation of BYD, the pace of the split of its battery business will be at least half a year or even longer than planned. After all, for a company with a large number of businesses and complicated systems, it is not an easy project to separate an entire business segment from the company.

With the increasing demand of the power battery market, many car companies such as BMW and Geely have also begun to lay out their own battery industry, and the integration of the industry is further accelerating; in the future, with the split listing of BYD's battery business, the competition in the power battery industry may further intensify.

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