Another market worth hundreds of billions is coming.

As the "eight-year commitment" expires one after another, power batteries for new energy vehicles are entering a "retirement wave."

At that time, ministries and commissions such as the Ministry of Industry and Information Technology clearly stipulated:

Since 2016, passenger car manufacturers must provide a warranty of at least eight years or 120,000 kilometers for core key components such as batteries and motors.

According to insurance registration data, there are more than 19.5 million new energy vehicles with an eight-year battery warranty.

Moreover, as time goes by, more and more new energy vehicle batteries will reach the end of their warranty period.

In 2025, the number of electric vehicles out of warranty will reach 320,000, 980,000 in 2028, and will soar directly to 7.2 million in 2032.

In the next eight years, the number of new energy vehicles in China whose power battery warranties expire will approach 20 million.

Here, how big is the market for power battery recycling?

According to statistics, the domestic power battery recycling volume exceeded 300,000 tons in 2024, corresponding to a market scale of over 48 billion yuan.

In addition, an official report predicts that by 2030, the market scale of power battery recycling will exceed 100 billion yuan.

Power batteries are the "heart" of new energy vehicles

Why are power batteries considered the "heart" of new energy vehicles?

Because power batteries account for 40% - 60% of the total vehicle cost.

Therefore, replacing the battery has become a headache for many car owners. They often complain online:

"I bought a BYD for 220,000 yuan eight years ago, and now the quote for replacing the battery is actually as high as 100,000 yuan. I really feel cheated."

"I spent 250,000 yuan on my car when it was delivered. Replacing the battery actually costs 120,000 yuan, almost half the price of the car."

Moreover, a Finnish Model S owner literally "blew up" his car because of battery replacement.

It is understood that this foreign car owner spent $57,400 on the car. When the car broke down and was sent for repair, he was told to pay a "sky-high" battery replacement fee of $22,600. In a fit of anger, he turned around and got 30 kilograms of explosives and "wiped the slate clean."

It really fits the saying: Buying a car is a moment of pleasure, but replacing the battery is a nightmare.

But there are indeed reasons why battery replacement is expensive.

In traditional fuel vehicles, the engine and gearbox together account for about 25% of the total vehicle component cost, but power batteries often account for about 50% of the component cost of new energy vehicles.

Moreover, generally speaking, when a vehicle has been used for 5 - 8 years and the battery capacity decays to 60% - 80%, the battery can no longer meet the power requirements of new energy vehicles.

According to the national "Inspection Regulations for the Operational Safety Performance of New Energy Vehicles," when the battery capacity decays by more than 60%, the vehicle may fail the annual inspection.

At this time, car owners have to consider whether to replace the car or the battery.

An industry insider told reporters that the cost of replacing a power battery is almost equal to or even exceeds the residual value of the car.

For example:

A Tesla Model S owner who has owned the car for eight and a half years reported that the quote for replacing the battery is over 200,000 yuan.

However, after eight years, even for models known for their high residual value, the current second - hand quote is less than 160,000 yuan.

That is to say, replacing a battery is more expensive than the car itself.

In addition, with the implementation of various new energy vehicle replacement subsidy policies and the update of cars, many car owners will choose to replace their cars.

On the other hand, what should be done with such a large number of "costly" retired power batteries?

If disposed of randomly, it will cause environmental pollution. After all, power batteries contain a variety of harmful substances, and it is also a great waste of social resources.

Therefore, retired batteries can first be downgraded for use in scenarios such as backup power, two - wheeled vehicles, and small - scale energy storage.

Secondly, for batteries that cannot be used in a cascading manner, they are recycled. Valuable metal materials such as lithium, cobalt, and nickel are extracted through crushing and recycled.

For example:

Brunp Recycling, a subsidiary of CATL, has transformed its independently developed DRT directional recycling technology into advanced standards, achieving a recovery rate of 99.6% for nickel, cobalt, and manganese and 96.5% for lithium. In 2024, it processed over 120,000 tons of waste batteries and produced 17,100 tons of recycled lithium salts.

Quanzhou Qingneng Company, through the construction of a standard system, processed 237 tons of retired batteries in 2024, reduced carbon emissions by 238 tons, and achieved an output value of 23 million yuan.

In short, the power battery recycling industry has huge market potential. It has not only attracted much attention in China but has also become a "blue - ocean track" of global concern.

The power battery recycling industry presents a situation of "small - scale, scattered, and chaotic"

An investigation by the Development Research Center of the State Council shows that as of 2023, the standardized recycling rate of power batteries for new energy vehicles in China was less than 25%.

A large number of retired power batteries have flowed into informal channels, forming a huge underground industrial chain. The recycling chaos is significant, and the overall competitive landscape temporarily presents a situation of "small - scale, scattered, and chaotic."

Actually, battery recycling was initially done by "small workshops," and later there were "regular troops" on the white - list.

However, some "small, low - end, and scattered" small workshops recycle and reuse batteries through methods such as "powdering" and disassembly and assembly. Not only is the product quality not guaranteed, but there are also safety hazards in the production process and environmental pollution.

A small workshop is soaking batteries

According to many industry insiders, many small workshops cannot provide a warranty for the disassembled and assembled batteries. They are "three - no products." Due to their short service life, many manufacturers register many stores on e - commerce platforms and "do business for only one year" and "shoot and move on," making it difficult for consumers to safeguard their rights.

So far, China has issued 22 national standards for power battery recycling and utilization.

These standards cover multiple aspects such as general requirements, management specifications, disassembly specifications, remaining energy detection, recycling and utilization, recycling and utilization of lithium - ion waste, and recycled black powder for power battery recycling.

They effectively support and lead the high - quality development of the power battery recycling industry.

Finally

Compared with the recycling and utilization of scrapped batteries, I believe everyone is more looking forward to when long - life batteries will be used in vehicles.

Because the "aging" problem of current power batteries is becoming more and more obvious, and the fact that the battery cannot have the same lifespan as the whole vehicle has also become a pain point for consumers.

In the future, how to extend the battery life is fundamental.

After long - life batteries are used in vehicles, in addition to extending the service cycle of new energy vehicles, the problem of the return of a large number of waste batteries will also be alleviated to a certain extent.

This article is from the WeChat public account "Xiaofang Talks about the Workplace" (ID: XF - SZC). The author is the Wang Xiaofang team. It is published by 36Kr with authorization.