CATL(SZ:300750) Sou Hu Cai Jing·2025-10-30 04:56Core Viewpoint - The lithium iron phosphate (LFP) industry is experiencing a new round of capacity expansion driven by strong downstream demand, with a focus on high-end products and overseas markets, transitioning from price and scale competition to value and technology competition [2][5][15]. Industry Demand and Supply - Leading LFP manufacturers are currently operating at full capacity, with secondary manufacturers also increasing their utilization rates [4][10]. - The demand for LFP is robust, as evidenced by significant long-term contracts and strategic investments, such as CATL's prepayment agreement of 1.5 billion yuan with Jiangxi Shenghua to secure LFP supply [5][7]. - In the first three quarters of this year, China's LFP battery installation volume reached 402.6 GWh, a year-on-year increase of 62.7%, accounting for 81.5% of total installations [7]. Capacity Expansion Plans - Companies are initiating strategic capacity expansions, with Jiangxi Shenghua planning a new project with an annual capacity of 350,000 tons of high-pressure density LFP, requiring an investment of 4 billion yuan [11]. - Dragon Power Technology and other firms are also expanding their production capabilities, with plans for new projects in various locations [12][13]. Market Dynamics - The LFP industry is witnessing a dual trend of expansion and contraction, with leading companies securing ample orders while smaller firms face challenges [15]. - The industry is shifting towards high-quality competition, focusing on technology, market presence, and cost efficiency rather than just price competition [15][16]. Technological Advancements - The industry is evolving towards high-pressure density, fast-charging, and long-cycle products, with several companies reporting significant sales of high-performance LFP materials [16]. - Companies are increasingly adopting integrated business models to enhance efficiency and reduce costs, with a focus on self-sufficiency in raw materials [16].