The Chinese Government has introduced stringent quality requirements for the country’s battery cell manufacturing industry, aiming to shore up quality, manage the country’s massive overcapacity, and consolidate the industry down to its strongest competitors. This will primarily benefit incumbent tier 1 battery manufacturers within the region, namely CATL, BYD (FinDreams), and CALB, as these companies have the expertise to bring all of their facilities up to standard. For tier 2 and 3 suppliers with less experience and financial resources, this will contribute to a tough situation which threatens them with consolidation. China’s battery manufacturing overcapacity is the key problem here, as it is having knock-on effects for the profitability of the industry and complicating raw material requirements. The country’s mammoth…