China Imposes New Restrictions on Electric Vehicle Battery Technology to Reinforce Global Leadership
By John Liu, CNN
Updated: July 17, 2025 – 10:05 PM EDT
Hong Kong (CNN) — In a significant move signaling its intent to fortify its dominant position in the global electric vehicle (EV) industry, China has introduced new export controls on key technologies used in the manufacturing of EV batteries. The Chinese government’s latest restrictions, announced by the Ministry of Commerce, add several critical battery production and lithium processing technologies to the country’s export control list. This means that transferring these technologies abroad—whether for trade, investment, or technological cooperation—will now require explicit government authorization.
A Strategic Step Amid Growing Global Competition
This development arrives just three months after Beijing implemented similar export controls on rare earth elements and related magnet technologies, which are essential not only for EVs but also consumer electronics and military hardware like fighter jets. China’s control over rare earth supplies has already become a potent geopolitical lever amid ongoing trade tensions with the United States.
With the EV market expanding rapidly worldwide, China’s strategic tightening of technology exports underscores its comprehensive strategy to maintain supremacy in this sector. The country boasts an integrated supply chain that ranges from raw material extraction and processing to advanced battery manufacturing. This integration has enabled China to develop cost-effective, high-performance EV batteries that dominate global markets.
China’s Dominance in EV Batteries
Chinese companies currently hold approximately 67% of the global EV battery market share, according to SNE Research, a market research and consultancy firm. Technology restrictions focus on manufacturing processes for lithium iron phosphate (LFP) batteries—a subtype of lithium-ion batteries known for affordability and safety—which have gained popularity particularly in the last five years. China commands an overwhelming 94% share of global LFP production capacity and produces 70% of processed lithium worldwide, as reported by UK-based research company Fastmarkets.
These new export controls also cover lithium processing and refinement, securing China’s grip on the entire upstream battery supply chain. Even as LFP batteries comprise 40% of global EV battery capacity, they are more prevalently used in Chinese-made EVs. Research from Adamas Intelligence indicates that while adoption outside China remains limited, EU and US automakers plan to increase their reliance on LFP technologies.
Impact on Chinese EV Makers and Global Expansion Plans
Chinese EV battery giants such as CATL—the world’s largest battery manufacturer and a key Tesla supplier—BYD, and Gotion have all established or planned manufacturing facilities abroad. CATL operates plants in Germany and Hungary, plans a joint venture in Spain with Stellantis, and licenses technology for a Ford battery plant in Michigan. BYD has production hubs across Hungary, Thailand, and Brazil, while Gotion intends to build a facility in Illinois.
Despite these plans, the new licensing requirements introduce uncertainty about overseas expansion. Obtaining the necessary Chinese government permissions could potentially delay these projects, although analysts suggest the immediate impact may be limited. Liz Lee, associate director at Counterpoint Research, explained that the restrictions seem focused on upstream process technologies rather than battery cell and module assembly, which are the focus of many overseas Chinese plants. Ford has stated it is not affected by the new controls.
Vincent Sun, a senior equity analyst at Morningstar, noted the ultimate effect depends on how quickly companies can secure export permits, implying longer-term consequences might unfold gradually.
Geopolitical Implications and the Push for Localization
Experts interpret China’s move as part of a broader geopolitical trend toward technological decoupling. By controlling key intellectual property and production processes in critical battery materials, Beijing is reinforcing barriers that may accelerate efforts in the US, EU, and other regions to localize precursor material supplies and metal refining capacities.
Liz Lee emphasized that this shift reflects "deepening geopolitical tech decoupling beyond materials to process IP," suggesting that global players may respond by investing more heavily in domestic battery supply chains.
Chinese Advances in EV Battery Tech
China’s lead in battery technology is notable. For example, BYD’s “Super E-Platform” battery technology enables a 250-mile range after a five-minute charge, significantly faster than Tesla’s Supercharger technology, which delivers 200 miles in 15 minutes. CATL has followed suit with an upgraded LFP battery offering a 320-mile range with the same charging speed, showcasing China’s rapid innovation.
Conclusion
China’s newly imposed export restrictions on EV battery production technologies mark a decisive effort to safeguard its economic security and technological leadership in a critical industry that is transforming the future of transportation. As global competition intensifies, the restrictions are likely to reshape international partnerships, supply chains, and the geographic landscape of EV manufacturing.
CNN has reached out to CATL, BYD, and Gotion for comments but has not received responses as of this publication.
Related Topics: Electric Vehicles, Battery Technology, China Trade Policy, Geopolitics, Rare Earth Elements, Lithium Processing
Images:
- Employees assembling EV charging stations at a factory in Ruichang, Jiangxi province, China. (AFP/Getty Images, July 9, 2025)
- BYD electric cars ready for export in Suzhou, China. (AFP/Getty Images, April 27, 2025)
- NIO vehicle undergoing final inspection in Hefei, China. (Kevin Frayer/Getty Images, January 17, 2025)
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