Chinese Battery Firms Expand Overseas Amid Domestic Overcapacity

Chinese battery manufacturers are aggressively expanding into international markets after severe domestic overcapacity dropped utilization rates to one-third of maximum capacity last year. According to the China Energy Storage Alliance, overseas orders surged more than 220% in the first half of 2025, totaling 186 gigawatt-hours across approximately 200 orders. While nearly 60% of these orders originated from Europe, Australia, and the Middle East, less than 3% came from the United States.

This minimal U.S. market share is attributed to heavy tariffs imposed by the Trump administration, including duties of up to 3,521% on certain solar imports. In response, Trina Solar and other firms are diversifying production bases, with roughly 80% of overseas capacity now located in Southeast Asia to localize manufacturing and mitigate tariff risks.

Domestically, the Government of the People's Republic of China is supporting the sector through a National Energy Administration plan to invest 250 billion yuan to build 180 gigawatts of storage capacity by 2027. Meanwhile, the U.S. utility-scale battery market has seen a 15-fold capacity increase since 2020, driven by a 40% price drop since 2022 and led primarily by deployment in California.