Gasgoo Munich- The 2026 World Power Battery Conference kicked off in Yibin, Sichuan, on September 3. On the same day, Xiong Jijun, vice minister of the Ministry of Industry and Information Technology, made it clear that the government would tighten oversight of the sector's competition, monitoring operations and issuing early warnings on capacity. The goal: to "curb low-price competition and blind expansion."
He noted that "irrational competition" has become a standout issue in the power battery industry today.
Robin Zeng, chairman of CATL, took the stage first, naming "quality" as the keyword for the next phase of the new energy industry. He defined the core of "CATL Quality" as safety, reliability, and longevity, bluntly criticizing the sector's obsession with "racing on speed, specs, and low prices"—often at the expense of product quality and consumer trust.
Hardly had Zeng finished when Liu Jincheng, chairman of EVE Energy, took the podium. Delivering a speech titled "Elevating Business Standards through Value Creation," he skipped the technical specs and product launches. Instead, he pointed to a far more fundamental issue:
With most companies reporting stellar half-year results and the industry basking in "optimism," what is the real threat China's lithium battery sector should be watching for?
Bidding Farewell to the Scale Race, Returning to "Value Creation"
"It's rare to see such optimism in 2026," Liu Jincheng remarked, assessing the state of the power battery industry this year.
Liu quickly steered the conversation to a deeper issue: after a period of explosive growth, the industry needs to rethink its commercial purpose and corporate vision.
He offered a core judgment: rational capacity expansion must become the consensus.
The word "rational" is the commercial logic Liu emphasized repeatedly.
In his view, expanding capacity during a boom is a natural choice, but expansion doesn't automatically equate to better development quality. If every company competes solely on scale, they eventually have to confront the hard questions of profitability and survival.
Liu didn't mince words: every industry has cycles, with peaks and troughs. "Expanding desperately at the peak, then panicking when the downturn hits"—that has been the battery industry's tortuous path over the past few years. "Reflecting on this right now, and making more rational judgments and choices, is critical for long-term development."
Companies cannot focus solely on market size or capacity potential, he argued; they must also identify where their profitability lies.
"Each guarding their own space for profit"—his remark cut straight to the heart of the industry's current pain point.
Image Source: 2026 World Power Battery Conference
Over the past few years, the power battery sector has endured a frenzied capacity race and a brutal price war, leaving some companies trapped in a dilemma of rising revenue without profit. Ultimately, firms must secure their survival through value creation, not by relying solely on scale expansion.
Liu elevated the issue to the level of "business civilization."
In his view, technological innovation addresses product competitiveness, but business civilization addresses whether an entire industry can operate healthily over the long term.
Once technology roadmaps become clear, the competition won't just be about products and capacity—it will be about "business acumen."
Regardless of the cycle, companies must ultimately return to value creation itself—that was the core conclusion of Liu's speech.
In fact, Liu was not speaking off the cuff.
Back in June 2026, at EVE Energy's 25th anniversary celebration, he vowed to "discard the labels of weak intellectual property, backward production, excess capacity, and low-price competition completely."
His remarks in Yibin were a continuation of that long-term thinking, resonating perfectly with current policy directions.
Competitors Are "Probiotics," Not "Pests"
If "value creation" was the prescription Liu offered for companies, his redefinition of competitive relationships revealed a broader industrial vision.
Discussing industry competition, Liu delivered a memorable line: "Peers are 'probiotics,' not 'pests.'"
In his view, competitors are not targets to be eliminated. A healthy industry requires diverse companies to compete, innovate, and develop markets together.
Liu further elaborated on his competitive philosophy: "Every entrepreneur has their own luck. You absolutely cannot kill off your competitors; whether they live or die depends entirely on their own strategy."
He suggested the industry view one another with more composure: those around you are partners. If they stray, give them a nudge; if they move fast, offer congratulations. That is far better than trying to wipe them out.
Behind these remarks lies a profound reflection on the "cutthroat" ecosystem that has plagued the industry in recent years.
Image Source: 2026 World Power Battery Conference
Since the Ministry of Industry and Information Technology first proposed "cracking down on irrational competition in the power battery sector" in November 2025, four government departments have held joint symposiums in January and April of 2026. The State Administration for Market Regulation also issued a directive in March adding lithium batteries to the list of key targets for preventing "cutthroat competition." The fight against "involution" has evolved from a verbal warning into a systematic policy tool.
Liu's speech echoed this policy direction. His calls for "rational expansion," "guarding profit space," and "elevating business civilization" are essentially attempts to chart a path beyond cutthroat rivalry toward healthy competition.
He examined the power battery sector through the lens of a longer industrial cycle, proposing that it should "serve as the energy foundation for a smart world." This means the industry cannot remain stuck in a cycle of mutual attrition; it requires a broader vision and greater patience.
From Zeng emphasizing "quality" to Liu stressing "value creation," and from the government curbing "low-price competition" to companies "guarding their own profit space," the message from this year's Yibin conference is clear: China's lithium battery industry is shifting from a battle of scale to a battle of quality, and from a race for speed to a test of endurance.
With the industry commanding over 70% of the global market share, and with the policy "visible hand" and the corporate "invisible hand" pointing in the same direction, the second half of the game for China's lithium battery sector won't be about who runs faster—but who goes further.
