The Electric: How China Responded to EV Supply-Chain Problems

Today's column is from Dalibor Petkovic, a researcher specializing in Chinese industrial policies. Since 2017, he has focused on the Chinese EV market, as well as smart cities, urban logistics and battery recycling management.

Supply chain disruptions over the past two years have prompted big changes in China’s market for electric vehicles and batteries. In response to shortages, policymakers and EV makers accelerated development of battery-swap programs, sodium batteries and efforts to increase the supply of lithium carbonate. 

Before 2020, battery swaps were primarily viewed as an option for fleets of taxis, ride-hail vehicles and delivery vehicles, because swaps can be quicker than charging; also, fleets generally use the same vehicles, so a swap station wouldn’t need multiple types of batteries. But in April 2021, the government added battery swaps to its list of technologies aimed at improving the nation’s infrastructure. In February 2022, the government urged companies to consider deploying used batteries in battery swap programs to reduce the cost of setting up a swap program. More recently, companies including EV maker Nio and battery maker Contemporary Amperex Technology Ltd. have launched battery-swap services.