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Wuhan Lixing lowers prices to grab battery market share

Posted: 09 Feb 2004 ?? ?Print Version ?Bookmark and Share

Keywords:wuhan lixing (torch) power sources? lithium batteries? cellular phones? wireless portable devices? broadband?

Wuhan Lixing (Torch) Power Sources Co. Ltd is expanding its capacity. In contrast, its Japanese counterparts are keeping their production steady, discouraged by the continuing fall in prices. The company produced 150 million units last year; it expects to turn out 200 million units this year.

The company will lower by 10 percent prices of its disposable lithium batteries. Automation of its processes has made the price cut possible. Besides, the company itself develops its own production equipment.

"Every time overseas competitors reduce prices, we can make responses immediately to keep our prices 50 percent lesser or even lower," says Wang. "We invested a lot to upgrade our product quality. We hope to be able to reach the same product level as foreign companies within the next two to three years. The company's research and development ability is at first-class level."

Wuhan Lixing forecasts rising demand for lithium batteries and Li-ion batteries over the next two or three years.

One of the possible key market drivers has been the increased production of computer motherboards by Taiwan computer makers who have either migrated or farmed out their production to mainland China. That is expected to boost demand for batteries, says Wang Chuanyi, VP.

Another is the rise in the use of cellphones following price declines. Still another possible market driver is the recent widespread use of battery-operated water, electric and gas meters in residential districts.

Wuhan Lixing makes disposable lithium batteries and rechargeable Li-ion batteries. It supplies disposable button-cell batteries to top computer makers, including Acer, ASUSTeK and Foxconn.

To meet the application requirement of wireless portable devices, broadband, MP3, personal handheld devices, GPS and POS, Wuhan Lixing also develops small, light and high-efficiency button-type and prismatic lithium batteries.

Apart from Wuhan Lixing, Sony, Matsushita and Maxwell mainly supply disposable lithium batteries.

At present, disposable button-cell lithium battery is still the market mainstream product. Lithium cylindrical batteries used in cameras, digital cameras are also selling fast.

Wuhan Lixing turns out some 20 million units of Li-ion batteries every year. It plans to boost production to 35 million units in two years. Prices are forecast to fall 20 percent this year with the increasing number of suppliers.

A Li-ion rechargeable battery downstream factory in Shenzhen will be set up this year, says Yu Jianhua, chief financial officer.

Recent new applications of Li-ion rechargeable batteries require high capacity, miniature size and high safety. To meet these requirements, the company is focusing its R&D efforts on improving battery cathodes, material formula production technology, protection circuits and outer covering packing, Chairman Xu Bin says.

Meanwhile, Li Sun Power Int. Ltd, which was acquired last May by Ind. Int. Inc., has been awarded a technology patent for its recently introduced battery control system for electric vehicles. Ind. Int. also owns Wuhan Lixing.

"Receiving this patent for our lithium battery technology attests to our ongoing progress in emerging as one of mainland China's leading providers of Li-ion batteries," says Dr. Kit Tsui, chairman and CEO of Ind. Int.

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