Sunwoda to Supply Battery Pack Systems for Volkswagen AG

Sunwoda, a leading Chinese battery company, announced on November 6 that its subsidiary Sunwoda Electric Vehicle Battery (Sunwoda EVB) will serve as a mass production supplier of battery pack systems for Volkswagen AG’s HEV project.

Sunwoda said that it is promoting follow-up work with Volkswagen AG. Both sides in this cooperation have good performance ability, and the actual supply quantity should be subject to the official sales order, and the impact on this year’s operating performance is uncertain.

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Sunwoda’s power battery business is growing rapidly. According to data by Chinese research platform Eastmoney’s Choice, the proportion of Sunwoda’s power battery revenue climbed from 1.12% in mid-2020 to 19.34% in mid-2022. According to the China Automotive Power Battery Industry Innovation Alliance, from January to September this year, the installed capacity of power batteries produced by Sunwoda was 4.84 GWh, ranking fifth among Chinese power battery enterprises, and it has become a major force in the field.

On October 27, Sunwoda released its third-quarter financial report. In the first three quarters, the company achieved operating income of 36.584 billion yuan ($5.06 billion), a year-on-year increase of 43.00%. Net profit was 688 million yuan, a year-on-year increase of 2.72%. The firm achieved revenue in the third quarter of 14.866 billion yuan, a year-on-year increase of 50.14% and a quarter-on-quarter increase of 33.96%. The net profit was 316 million yuan, up 504.79% year-on-year and 13.86% quarter-on-quarter.

From January to September, energy storage revenue was 327 million yuan, a year-on-year increase of about 100%. The firm’s electric vehicle battery business, with revenue of 7.8 billion yuan, up 406% year-on-year, is the fastest growth rate among all business segments.

In the past two years, Sunwoda has successively received orders from many well-known car companies such as Dongfeng Motor, Geely, SAIC and GAC Motor, and has established solid cooperative relations with Renault and Nissan. It has successfully entered the supply chain of many well-known car companies within China and abroad, and its supply ability is becoming increasingly strong.

According to 36Kr in August this year, as a holding subsidiary of Sunwoda, Sunwoda EVB has completed a new round of financing worth 6 billion yuan, which greatly exceeds its previously planned fundraising quota of 3 billion yuan, with a valuation of 22-23 billion yuan.

Benefiting from the booming production and sales of new energy vehicles, demand in China’s battery market is rising. According to data released by the China Automotive Power Battery Industry Innovation Alliance, from January to September, the country’s power battery output totaled 372.1 GWh, a year-on-year increase of 176.2%. In terms of installed capacity, from January to September this year, the cumulative loading capacity of power batteries in China reached 193.7 GWh, up 110.5% year-on-year, among which the monthly installed capacity in September reached 31.6 GWh, up 101.6% year-on-year and 14.0% quarter-on-quarter.