Growth will be driven by a continuing shift toward higher-value secondary batteries, rising Chinese ownership of high-drain electronics, and expanding motor vehicle and electronics production.

Demand in China to rise 13% annually through 2016

Demand for batteries in China is forecast to increase 13.0 percent annually to ¥259.4 billion in 2016. Growth will be driven by a continuing shift in the product mix toward higher-value secondary batteries, rising ownership of high-drain electronic products by Chinese consumers, and expanding production of motor vehicles and electronics. The export of battery containing products -- in particular cellular phones, laptop computers, and other portable devices -- will further spur battery demand in China.

Secondary batteries to outpace primary types

Demand for secondary batteries in China is projected to rise at a strong doubledigit annual rate through 2016. Rechargeable lithium batteries will post the strongest growth, primarily driven by their superior performance attributes -- such as a higher power density ratio and longer product lifespan -- compared to competing chemistries. The expanding range of applications, continuing technological innovation, and decreasing prices will further boost gains. Lead-acid batteries will remain the largest segment, accounting for over half of the secondary battery market total in 2016. The transportation equipment market will be principally responsible for advances in secondary battery demand. Demand in this market will benefit from expanding production and a growing park of electric bicycles, motorcycles, and motor vehicles. The portable devices battery market will increase nearly 12 percent annually through 2016. Gains will be supported by rising consumer electronics production and increasing exports.

Alkaline batteries to remain key primary type

Sales of primary batteries will increase at a strong but slower annual rate than secondary batteries through 2016. Alkaline batteries will further strengthen their dominance in the primary battery market and continue to post the fastest gains at the expense of zinc-based battery demand growth. Alkaline batteries are favored for their greater power and longer lifespan than zinc-carbon/ chloride batteries. The consumer market will continue to be the dominant outlet for primary battery sales in China in 2016. Demand for primary batteries in the consumer segment will be fueled by increasing production of and domestic demand for home entertainment and portable devices and the introduction of new primary battery-powered portable devices.

China maintains trade surplus in batteries

China maintains a trade surplus in batteries, with exports accounting for nearly 24 percent of battery shipments in 2011. About 11 percent of demand was satisfied by imports -- down from about 22 percent in 2006 -- highlighting the increasing self-sufficiency of the Chinese battery market. The majority of imported batteries feature more advanced technology, such as rechargeable lithium, while exported batteries generally include lower-cost products such as zinc-carbon/chloride, alkaline, and nickel-based batteries.

Scope

This industry study, Batteries in China, presents historical demand data for 2001, 2006 and 2011, and forecasts for 2016 and 2021 by product and market. The study also considers market environment factors, details industry structure, evaluates company market share, and profiles 40 industry participants.

SECTION PAGE

INTRODUCTION x

I. EXECUTIVE SUMMARY 1

II. MARKET ENVIRONMENT             4
General               4
Economic Overview             5
     Recent Economic Performance            5
     Economic Outlook             7
Population Patterns            10
Personal Income & Expenditure Trends          13
Industrialization & Manufacturing Trends         15
Currency Exchange Rates            18
Government Spending & Investment Trends          21
Motor Vehicle Outlook            22
     Motor Vehicles in Use           23
     Motor Vehicle Production Trends          23
     Hybrid/Electric Vehicle Outlook          24
Electrical & Electronics Sector Outlook          26
Environmental & Regulatory Considerations         27
The Twelfth Five-Year Plan           29

III. TECHNOLOGY             31
General              31
Basic Electrical Properties           33
Battery Construction & Operation          34
Conventional Battery Chemistries          36
     Zinc-Carbon/Zinc-Chloride           36
     Alkaline             37
     Lead-Acid             38
     Nickel-Cadmium            38
     Others             39
Advanced Battery Chemistries           39
     Lithium             40
     Nickel-Metal Hydride            42
     Zinc-Air             43
     Rechargeable Alkaline           44
     Others             44
Fuel Cells & Other Alternative Sources of Power         46
     Fuel Cells             46
     Other Sources of Power           48
Smart Batteries             50

IV. BATTERIES OVERVIEW            52
General              52
Pricing Patterns            54
International Environment           56
     World Outlook            57
     Foreign Trade            59
        Primary Batteries            60
        Secondary Batteries           61

V. PRIMARY BATTERY PRODUCTS           63
General              63
Alkaline Batteries            66
Zinc-Carbon/Chloride            69
Primary Lithium             72
Other Primary Batteries            74
     Silver Oxide             75
     Zinc-Air             77
     Specialty & All Other Primary Batteries         79

VI. PRIMARY BATTERY MARKETS            82
General              82
Consumer Primary Battery Market           84
     Entertainment Devices & Home Appliances         86
     Toys & Games             87
     Lighting             88
     Photography Equipment           89
     Other Consumer Applications           89
Industrial Primary Battery Market          90
Government Primary Battery Market          92
Health Care & Other Primary Battery Markets         94

VII. SECONDARY BATTERY PRODUCTS           97
General              97
Lead-Acid Batteries           100
     Starting/Lighting/Ignition          102
     Non-SLI            104
        Motive Power           105
        Stationary & Other Types          106
Rechargeable Lithium Batteries          107
     Lithium Ion            109
     Lithium Polymer           111
Nickel-Metal Hydride Batteries          112
Nickel-Cadmium Batteries          114
Other Secondary Batteries          117
     Nickel-Hydrogen           118
     Rechargeable Alkaline          119
     Rechargeable Zinc-Air          120
     Sodium-Sulfur           120
     All Others            120

VIII. SECONDARY BATTERY MARKETS          122
General             122
Transportation Equipment Secondary Battery Market       125
     Electric Bicycles & Motorcycles         127
     Traditional Motor Vehicles          130
     Low-Speed Vehicles           132
     ICE Motorcycles           135
     Hybrid-Electric & Electric Vehicles         136
Portable Devices Secondary Battery Market        140
     Personal Communications Devices         142
     Portable Computers           143
     Power Tools            145
     Other Portable Devices          146
Motive Power Secondary Battery Market         148
     Industrial & Mining Vehicles          149
     Other Motive Power           150
Backup Power Supply Secondary Battery Market        150
     Industrial            152
     Telecommunications           153
     Utility-Related           154
Government & Other Secondary Battery Markets        155

IX. INDUSTRY STRUCTURE           157
General             157
Industry Composition           158
Market Share            162
     Primary Batteries           163
     Secondary Batteries           167
Research & Product Development          172
Manufacturing            173
Supply Chains            174
Marketing & Distribution          176
Financial Requirements           178
Cooperative Agreements           179
Foreign Participation in China          181
Company Profiles           183
     Amperex Technology, see TDK
     Baoding Jin Fengfan Storage Battery, see Fengfan
     BYD Company Limited           184
     Camel Group Company Limited          186
     Celxpert Energy Corporation          187
     China BAK Battery Incorporated         188
     China Shoto plc           190
     Coslight Technology International Group Limited       192
     Duracell International, see Procter & Gamble
     Dynapack International Technology Corporation       195
     Energizer Holdings Incorporated         196
     EnerSys            199
     Fengfan Stock Company Limited         202
     Fujian Minhua Power Source Company Limited        203
     Fujian Nanping Nanfu Battery, see Procter & Gamble
     GP Batteries International Limited         204
     GS Yuasa Corporation           207
     Guangdong Zhenglong Battery Industry
        Company Limited           209
     Guangxi Wuzhou Sunwatt Battery Company Limited       210
     Guangzhou Hi-Watt Battery, see Guangzhou Tiger Head Battery Group
   and Hi-Watt Battery Industry
     Guangzhou Tiger Head Battery Group Company Limited       211
     Henan New Taihang Power Source Company Limited       213
     Hi-Watt Battery Industry Company Limited        214
     Huanyu Power Source Company Limited         215
     Jiangsu HighStar Battery Manufacturing
        Company Limited           216
     Johnson Controls Incorporated         218
     Panasonic Corporation          221
     Procter & Gamble Company          226
     Samsung SDI Company Limited          229
     SANYO Electric, see Panasonic
     SCUD Group Limited           230
     Shanghai White Elephant Swan Battery
        Company Limited           232
     Shenzhen Desay Battery Technology Company Limited       234
     Simplo Technology Company Limited         236
     Sony Corporation           238
     Spectrum Brands Holdings Incorporated        240
     SUNWODA Electronic Company Limited         242
     TCL Corporation           243
     TDK Corporation           244
     Tianjin Lishen Battery Joint-Stock Company Limited       246
     Tianneng Power International Limited         247
     Weihai Wenlong Power Supply Group Company Limited       248
     Xiamen Three Circles Battery Company Limited        249
     Zhejiang Mustang Battery Company Limited        250
     Zhejiang Narada Power Source Company Limited        251
     Zhongyin Ningbo Battery, see GP Batteries International
     Zibo Torch Energy Company Limited         253
Other Companies Mentioned in Study         254

List of Tables

TABLE NUMBER PAGE

SECTION I -- EXECUTIVE SUMMARY
Summary Table 3

SECTION II -- MARKET ENVIRONMENT
1 Gross Domestic Product of China           10
2 Population of China            13
3 Consumer Income & Expenditures in China          15
4 Manufacturing Value Added in China          18
5 Chinese Currency Exchange Rates, 2001-2011         20
6 Government Spending & Investment in China         21
7 Motor Vehicle Indicators in China          22
8 Electrical & Electronic Equipment Production in China        27

SECTION III -- TECHNOLOGY
1 Fuel Cell Demand in China by Market 48
2 Smart Battery Demand in China 51

SECTION IV -- BATTERIES OVERVIEW
1 Battery Supply & Demand in China          54
2 Battery Pricing in China           56
3 Chinese Foreign Trade in Batteries          59
4 Chinese Foreign Trade in Primary Batteries         61
5 Chinese Foreign Trade in Secondary Batteries         62

SECTION V -- PRIMARY BATTERY PRODUCTS
1 Primary Battery Supply & Demand in China         65
2 Alkaline Battery Supply & Demand in China         69
3 Zinc-Carbon/Chloride Battery Supply & Demand in China        71
4 Primary Lithium Battery Supply & Demand in China        74
5 Other Primary Battery Supply & Demand in China         75
6 Silver Oxide Battery Demand in China          77
7 Zinc-Air Battery Demand in China          79
8 Specialty & All Other Primary Battery Demand in China        81

SECTION VI -- PRIMARY BATTERY MARKETS
1 Primary Battery Demand in China by Market         83
2 Consumer Primary Battery Market in China         86
3 Industrial Primary Battery Market in China         92
4 Government Primary Battery Market in China         94
5 Health Care & Other Primary Battery Markets in China        96

SECTION VII -- SECONDARY BATTERY PRODUCTS
1 Secondary Battery Supply & Demand in China         99
2 Lead-Acid Battery Supply & Demand in China        102
3 Starting/Lighting/Ignition Battery Demand in China       104
4 Non-SLI Lead-Acid Battery Demand in China        105
5 Rechargeable Lithium Battery Supply & Demand in China       109
6 Nickel-Metal Hydride Battery Supply & Demand in China       114
7 Nickel-Cadmium Battery Supply & Demand in China        116
8 Other Secondary Battery Supply & Demand in China       118

SECTION VIII -- SECONDARY BATTERY MARKETS
1 Secondary Battery Demand in China by Market        124
2 Transportation Equipment Secondary Battery Market
     in China            127
3 Electric Bicycles & Motorcycles Secondary Battery Market
     in China            130
4 Traditional Motor Vehicle Secondary Battery Market in China      132
5 Low-Speed Vehicle Secondary Battery Market in China       134
6 ICE Motorcycle Secondary Battery Market in China       136
7 Hybrid-Electric & Electric Vehicle Secondary Battery Market
     in China            139
8 Portable Devices Secondary Battery Market in China       141
9 Personal Communications Devices Secondary Battery Market
     in China            143
10 Portable Computer Secondary Battery Demand in China       145
11 Power Tools Secondary Battery Market in China        146
12 Other Portable Devices Secondary Battery Market in China      147
13 Motive Power Secondary Battery Market in China        149
14 Backup Power Supply Secondary Battery Market in China       152
15 Government & Other Secondary Battery Market in China       156

SECTION IX -- INDUSTRY STRUCTURE
1 Revenue Data: Selected Battery Manufacturers, 2011 160
2 Selected Cooperative Agreements 180

List of Figures

CHART NUMBER PAGE

SECTION III -- TECHNOLOGY
1 Basic Battery Construction 35

SECTION V -- PRIMARY BATTERY PRODUCTS
1 Primary Battery Demand in China by Chemistry, 2011 66

SECTION VI -- PRIMARY BATTERY MARKETS
1 Primary Battery Demand in China by Market, 2011 84

SECTION VII -- SECONDARY BATTERY PRODUCTS
1 Secondary Battery Demand in China by Chemistry, 2011 100

SECTION VIII -- SECONDARY BATTERY MARKETS
1 Secondary Battery Demand in China by Market, 2011 125

SECTION IX -- INDUSTRY STRUCTURE
1 Battery Market Share in China by Company, 2011        163
2 Primary Battery Market Share in China by Company, 2011       164
3 Secondary Battery Market Share in China by Company, 2011      168
4 Electronics Secondary Battery Supply Chains        176