Informist, Friday, Jun 28, 2024

--Sources:Exide to price lithium-ion battery in tune with import price

--Sources:Exide to secure raw material via Chinese partner's channels

--Sources: Imported lithium-ion battery currently costs $134-$150/kWh

--Sources:Imported lithium-ion battery price to fall to $130/kWh 2025

--Sources: See imported lithium-ion battery price $100/kWh in 3-4 yrs

By Avishek Rakshit

KOLKATA – Automotive battery major Exide Industries Ltd is considering pricing its upcoming lithium-ion batteries for cars in tune with prices of imported batteries, sources aware of the company's plans told Informist. This would help the company gain significant market share soon after its foray into the segment, they said.

The imported price of lithium-ion batteries for cars is currently between $134 and $150 per kWh, with the average price being $138, though this could fall to $130 per kWh next year as availability increases, industry officials said. Considering the projected rate, a 30-40 kW hour battery used in cars in India could be priced at $3,900-$5,200 in 2025. Typically, electric cars in India have battery capacity of 30-40 kWh, according to industry officials.

An official from the car battery manufacturing industry said that the average landing price of imported lithium-ion batteries in India has been declining and is set to fall to around $100 per kWh in the next three-four years, as several companies globally are venturing into the business and making the product widely available.

Officials from Exide declined to comment on the company's pricing strategy.

"There are two factors to Exide's pricing strategy for lithium-ion products. First, it is indexed to raw materials, meaning that volatility in raw material costs will be passed onto the consumers and secondly, consumers would not pay more for an indigenous battery as compared to import prices," said a sector analyst tracking Exide, the country's largest vehicle battery manufacturer.

Through its agreement with Chinese company SVOLT Energy Technology Co Ltd, Exide is looking to source raw materials from outside India at competitive rates, using the Chinese company's sourcing channels.

The official from the car battery manufacturing industry said that currently, India does not have an ecosystem that can help Exide with the requisite supply chain to manufacture lithium-ion batteries. "Thus, if a company directly ventures into raw material sourcing without any prior experience, it may not get competitive rates, but if it goes via a company which has been an early mover in the lithium-ion cell manufacturing business, it may get competitive raw material sourcing rates," the official said.

Analysts tracking the sector said that to a large extent, Exide would benefit from its partnership with SVOLT, which could enable it to price its products in tune with imported prices, and have a technological edge at the same time.

As per the agreement, SVOLT will transfer design and intellectual property rights to Exide to manufacture batteries. The Chinese company is also helping Exide set up its 1 GW hour capacity factory in Karnataka, and procure the necessary machinery. The plant will be operated by Exide's wholly-owned subsidiary Exide Energy Solutions Ltd. SVOLT will help Exide use its own supply chain and ramp up production.

At 1153 IST, shares of Exide were up 0.4% at 568.7 rupees on the National Stock Exchange. End

US$1 = 83.45 rupees

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Avishek Dutta

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

Informist Media Tel +91 (22) 6985-4000

Send comments to feedback@informistmedia.com

© Informist Media Pvt. Ltd. 2024. All rights reserved.