China Moves to Protect Its EV and Battery Supply Chains

Jan. 13, 2025
By: Hannah B. Kreinik

The Chinese Ministry of Commerce announced recommended export controls on battery cathode and lithium extraction technology to defend its domestic electric vehicle business. The government is currently seeking comments related to the proposed changes to the Catalogue of Technologies Subject to Export Prohibitions and Restrictions. The new changes would place restrictions on lithium iron phosphate, lithium manganese iron phosphate cathode preparing technologies, and certain lithium extraction technologies. This is not China’s first export controls for battery elements, please see our previous article on the topic here.

China specified that the proposed export changes was not in retaliation to any one country but was in the interest of their domestic electric vehicle and battery manufacturing industries. However, certain professionals in the battery sector believe that the new restrictions come at a peculiar time as the second Trump administration prepares to take office in the U.S. With that said, China has been subsidizing and investing in the domestic battery supply chains well before the U.S. began to take similar actions.

Regardless of the reasoning behind these latest changes, importers should be aware of these restrictions and note potential delays in the battery production supply chain. Importers should also expand their horizons to other battery manufacturers outside of China to avoid continued conflicts with U.S.-China trade disputes. The U.S. is building up its electric vehicle manufacturing sector, and establishing new battery and critical mineral supply chain options with other countries (see our previous article here). There is no decrease in sight for electric vehicle and lithium-battery demand.

Our attorneys at Barnes, Richardson & Colburn are monitoring the ever-growing changes in the EV and battery sectors and can assist with any importer concerns on the subject.