China has consolidated its global leadership in two key technology sectors: lithium-ion batteries and semiconductor manufacturing. In batteries, companies such as CATL and BYD dominate the global market, while in the chip sector, domestic production has reached record levels in defiance of international sanctions. This double success in strategic areas underlines China’s ability to transform its economy and position itself as a benchmark in innovation and technological self-sufficiency.
In recent years, we have spoken on multiple occasions about China’s ability to revolutionise various technological industries, from Artificial Intelligence to the manufacture of advanced machinery. Today, this leadership is more evident than ever, with continued and sustained growth in crucial sectors such as batteries and semiconductors. Both are positioning China as a global powerhouse, capable of influencing global markets in a direct and forceful way.
Lithium-ion batteries: undisputed leader
China is the clear global leader in lithium-ion battery production. By 2024, the country is estimated to produce 80% of the world’s batteries, with CATL and BYD at the forefront of the market. These companies account for more than 50% of the global share, with CATL leading with 38.3% and BYD reaching 16.7%. This dominance reflects not only a significant technological breakthrough, but also a long-term national strategy that has enabled China to position itself as the leading supplier of batteries for electric vehicles and electronic devices.
China’s success in the battery market is due to a combination of factors. First, government support, including subsidies for the production and consumption of cheaper and safer batteries, has been essential. Since 2009, the strategy has focused on the development of lithium iron phosphate (LFP) batteries, which are more affordable than those based on cobalt and nickel. This innovation, coupled with access to critical raw materials such as lithium, has enabled China not only to supply its domestic electric vehicle market, but also to export batteries to other countries, further consolidating its global dominance in the sector.
Semiconductors: record output despite sanctions
In the semiconductor sector, China has reached a significant milestone by achieving record chip production in 2024, exceeding expectations despite US sanctions. Semiconductor Manufacturing Corporation of China (SMIC) has been a key player in this growth, reporting a 28% increase in quarterly revenue. This growth has been driven by increased demand for advanced chips and continued investment in infrastructure to improve manufacturing capacity, especially in 7-nanometer chips.
Despite international restrictions, China has managed to remain at the forefront of semiconductor production. US sanctions have attempted to limit access to advanced technology, but China has responded with a focus on self-sufficiency, developing its own manufacturing capabilities. In 2024, China’s export of integrated circuits exceeded 1 trillion yuan in the first 11 months of the year, an increase of 20.3 per cent year-on-year. This increase reflects the robustness of the sector and the ability of Chinese companies to adapt to the demands of the global market, despite political adversities.
Final thoughts
China has demonstrated an exceptional ability to transform challenges into opportunities, consolidating its position as a leader in strategic technology sectors. Its focus on innovation, government support and investment in infrastructure have been key to this success. Batteries and semiconductors are just two examples of how China has managed not only to position itself as a key player in the global economy, but also to become a benchmark for innovation and development.
This model of growth and adaptation can serve as an inspiration for other nations seeking to strengthen their competitiveness in the global economy. Undoubtedly, the future of technology will be marked by the dominant role of China, which continues to advance its leadership strategy in key sectors.