Chinese battery shares fell sharply on Friday after Beijing announced new export controls on lithium battery materials and technology, deepening its hold on a supply chain vital to global electric vehicle (EV) and energy storage industries.
The Ministry of Commerce said exporters of certain high-end lithium-ion batteries, cathode and graphite anode materials, and related technical know-how will now require permits starting November 8. The move follows China’s expanded restrictions on rare earths, escalating tensions with the United States ahead of a potential meeting between Presidents Donald Trump and Xi Jinping.
Shares of major producers sank: CATL dropped 6.82%, Tianqi Lithium fell 7.17%, EVE Energy plunged nearly 11%, and BYD lost 2.54% by market close. China’s New Energy Vehicles Index slid 6.02%.
“The new controls drastically expand how much of the lithium battery supply chain China is staking a claim to,” said Cory Combs of Trivium China, warning that Beijing could slow or limit export licenses to maintain leverage.
Analysts at Zaoshang Securities argued the impact should be limited, saying the measures stop short of a ban and that past controls, such as those on natural graphite, caused no major export decline. Still, investors remain uneasy as the curbs come alongside tighter EV tax exemption rules, which could hit domestic demand.
Chinese companies such as CATL and BYD, which supply automakers worldwide and operate joint ventures like the Ford-CATL plant in the U.S., could face ripple effects across global supply chains as Washington and Beijing compete for dominance in critical materials.