In-depth Analysis of the Competitive Landscape in the Power Battery Industry

Based on the latest data and market information I have obtained, I will systematically analyze the changes in the competitive landscape of the power battery industry for you.

According to the latest data, China’s power battery market from January to November 2025 shows obvious pattern reshaping characteristics:

Company	Loading Volume (GWh)	Market Share	YoY Change
CATL	287.68	41.7%	-2.16ppt
BYD	148.14	22.1%	-2.89ppt
China Innovation Aviation	40.65	7.05%	+1.2ppt
Gotion High-Tech	37.74	5.63%	+0.8ppt

• Loosening of the ‘Dual Kings’ Pattern
  : The combined market share of CATL and BYD dropped from over 70% in 2023 to
  65.02%
  , a decrease of nearly 5 percentage points [1]
• Market Concentration Decline
  : The loading share of the top 10 enterprises was 94.2%, down 1.6 percentage points from 2024 [1]
• Accelerated Breakthrough of Second-tier Players
  : Gotion High-Tech, Reptile Lanjun and other enterprises have impressive growth rates, with market share continuing to rise [1]

To reduce supply risks and procurement costs, vehicle manufacturers actively introduce multiple battery suppliers. Taking NIO as an example, its battery supply has shifted from a single CATL to multiple sources, including China Innovation Aviation, Fudi Battery and Sunwoda [3]. This ‘de-CATLization’ trend has created market space for second-tier manufacturers.

In 2025, the share of Lithium Iron Phosphate (LFP) exceeded 80%, with an unprecedentedly unified technical route [1]. When technical differences narrow, price factors become key decision points. Second-tier manufacturers have made breakthroughs in A00-class low-end models and commercial vehicle fields relying on low-cost advantages.

Upstream equipment and materials will prioritize CATL’s increments, but second-tier manufacturers seize market share through more aggressive pricing strategies. The cell gross profit of some second-tier battery factories is only 3-4 cents per watt-hour, and some are even in a loss state [2].

• Commercial Vehicle Field
  : The demand for new energy commercial vehicles has exploded, becoming an important growth pole for loading volume, and second-tier manufacturers are actively布局 in this field [1]
• Energy Storage Market
  : Overseas capacity expansion such as Gotion High-Tech’s US factory provides new growth points for second-tier enterprises [1]

CATL’s gross profit per watt-hour dropped from 0.19-0.2 yuan in 2024 to 0.13 yuan in the first half of 2025, a decrease of 20% [3]. The decline in market share directly weakened its negotiation advantages over upstream lithium ore resources and downstream vehicle enterprises.

The decline in market share means limited revenue scale, which may affect CATL’s R&D investment rhythm in next-generation technologies such as solid-state batteries and sodium-ion batteries.

• Chinese Market
  : CATL still ranks first with 42.92%, but its leading edge has narrowed [1]
• Overseas Market
  : CATL surpassed LG Energy Solution in non-Chinese market share for the first time in 2024, and globalization has entered a new stage of ‘localized production + technology output’ [6]

Second-tier manufacturers with technical accumulation and financial strength will get more integration opportunities, while small and medium-sized manufacturers without core competitiveness may face elimination.

Although its market share has declined, CATL still has multiple core competitive advantages:

• Multiple bases for flexible resource allocation
• Rich engineering implementation experience to quickly promote mass production and delivery
• Strong appeal to upstream suppliers; equipment manufacturers prioritize sending senior engineers to support [3]

• Solid-state Batteries
  : It is likely to complete pilot test acceptance in the fourth quarter of 2025, with a 1,000-person R&D team and leading technical maturity [2]
• Sodium-lithium Batteries (Dual-core Batteries)
  : Improve low-temperature performance through sodium-lithium combination to achieve differentiated competition
• Chocolate Battery Swap Models
  : Will fill the share loss in A00-class and low-end vehicle markets [2]

The expected sales of energy storage cells in 2025 will increase from 90 GWh in 2024 to over 130 GWh, and the energy storage business will become a new growth pole [2].

Through investments in NIO Energy and WeNeng Battery, CATL quickly fills the gap when customers are in trouble, and regains market share using the advantage of production capacity flexibility [3].

###5. Future Competitive Landscape Forecast

• CATL’s domestic market share is expected to remain in the range of 40%-42%
• BYD will maintain a share of 20%-22% relying on vertical integration advantages
• Second-tier manufacturers such as China Innovation Aviation and Gotion High-Tech will increase their market share to the range of 8%-10%

• The maturity of solid-state battery technology will determine the new round of competitive landscape
• Localized production in overseas markets will become a key battlefield
• The industry’s CR3 concentration may further drop from the current 72% to around 65%

• The competitive pattern of ‘leading by head enterprises + breakthrough by second-tier players’ will become the norm
• Technological innovation (rather than scale) will become the core competitiveness
• Regional supply chain layout (North America, Europe, Asia) will determine the global ranking

###6. Investment Insights and Risk Warnings

• Second-tier manufacturers with technical breakthrough capabilities have valuation revaluation opportunities
• The rapid growth of the energy storage business provides new growth poles for leading enterprises
• Incremental space brought by overseas market expansion

• Price war risk caused by overcapacity
• Uncertainty brought by changes in technical routes
• Overseas policy risks (US Inflation Reduction Act, EU Battery Regulation)

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The power battery industry is evolving from ‘dominance by one player’ to ‘multi-player competition’. Although CATL’s domestic market share has dropped to 41.7%, its technical reserves, global layout and systematic capabilities still form a solid moat. The rise of second-tier manufacturers will erode the share of leading enterprises in the short term, but in the long run, healthy industry development requires sufficient competition to drive technological innovation and cost reduction. For investors, focusing on high-quality enterprises with differentiated technical capabilities and global layout will yield excess returns in the reshaping of the landscape.

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[1] Power Battery 2025 Review: LFP Share Exceeds 80%, Energy Storage Exports Double, Second-Tier Enterprises Rise - Sohu (https://m.sohu.com/a/966555429_100044558)

[2] Reasons for CATL’s Continued Strength in the Future - Sina Finance (https://finance.sina.com.cn/stock/relnews/cn/2025-12-23/doc-inhcvfae0519676.shtml)

[3] What CATL Lost, It Wants to Take Back | Deep Kr - Sina (https://k.sina.com.cn/article_7096020371_1a6f4ad9301901jule.html)

[4] SNE Research Heavy Report: Chinese Battery Enterprises Lead Strongly, Share of Three Korean Giants Declines - Sina Finance (https://finance.sina.com.cn/roll/2025-12-03/doc-infznqyq9692032.shtml)

[5] 2025 China Battery Swap Industry Chain Map and Investment Layout Analysis - NetEase (https://www.163.com/dy/article/KGVICDKN05198SOQ.html)

[6] Foresee 2025: “2025 China Lithium Battery Industry Panoramic Map” - Sina Finance (https://finance.sina.com.cn/roll/2025-12-20/doc-inhcmhcr1505453.shtml)