Car battery makers urge Beijing to bring in recycling rules
Key players in the mainland's vehicle battery industry are urging the authorities to issue specific rules governing the recycling of batteries as a way to protect the environment and make the industry more sustainable.
Kenneth Yeng, a vice-president and general manager of Johnson Controls' power solutions operations, said it was trying to understand mainland market conditions with a view to promoting "a well-regulated and efficient recycling system for used vehicle batteries".
"This is no easy job, but we hope to bring our expertise and technologies to China with support from the local governments," he said.
Milwaukee-headquartered Johnson Controls is the world's largest manufacturer and recycler of conventional vehicle batteries, and it sold more than a third of the world's vehicle batteries last year.
Although the mainland is the world's largest car market, it lacks a recycling system for car batteries, with most used batteries collected by small, unlicensed vendors who recklessly dispose of them after selling the lead to other manufacturers.
Yeng said such unregulated disposal led to the dumping of hazardous waste, which would eventually spur the government into action.
In the United States, more than 90 per cent of lead-acid car batteries are collected by the makers themselves for recycling.
"With the government taking the lead, lots of work can be done to fine-tune the system," Yeng said, adding that Johnson Controls believed 100 per cent recycling rates were possible.
The mainland's fast-growing car market, buoyed by a rising middle class, has attracted global carmakers and parts manufacturers, but pollution concerns have been increasing in recent years, with Beijing starting to raise vehicle emission standards.
The mainland produces up to 2 million tonnes of used lead-acid batteries each year, and the mishandling of the scrap lead and leftover acid could spoil the country's soil and water.
Companies involved in the industry, both domestic and international, have urged local governments to crack down on illegal vendors and issue rules to force all the players in the industrial chain to comply with recycling standards.
Zhang Tianren, the chairman of mainland battery maker Tianneng, proposed to the National People's Congress in March that the government establish a complete car battery recycling chain, encompassing battery makers, licensed collectors, licensed lead producers and car owners.
Zhang Wei, a manager with Enersys, one of the world's largest industrial battery makers, said manufacturers hoped the government would support the creation of a "Western-style recycling system" that was "not only environmentally friendly but also economically efficient".
The mainland has about 2,000 car battery makers, mostly smaller players with little financial strength. A planned consolidation of the industry would see the number of companies reduced to about 300.
"It will be easier to regulate the industry following consolidation," Yeng said, declining to say whether Johnson Controls had any acquisition plans on the mainland.
It has captured about 10 per cent of the mainland car battery market and Yeng said business was expected to continue growing at double-digit rates in the coming years.
Johnson Controls started production at a US$154 million plant in Chongqing last month that could produce 6 million car batteries a year. The company also plans to set up a battery factory in northern China in 2017 or 2018.