Lithium carbonate, the key raw material for EV batteries, has seen its price collapse in recent months. The main futures contract closed down 11.79 percent in a single session at 104,680 yuan per ton, less than half of the peak reached in mid-May this year.
Goldman Sachs expects the average spot price of lithium carbonate in China to fall to around 100,000 yuan per ton in 2027 and to about 84,000 yuan per ton in 2028. The bank projects the global lithium market will swing from a supply shortage of about 404,000 tons in 2026 to a surplus of roughly 444,000 tons by 2028 as new capacity comes online.
For battery and vehicle manufacturers, the halving of lithium prices significantly lowers cell costs and supports a recovery in margins across the midstream and downstream of the NEV supply chain, from cathode materials and battery makers to vehicle assemblers competing on price.
Analysts caution, however, that the NEV sector is facing mixed signals: while falling battery costs are a tailwind, the export VAT rebate for NEVs will be cut from 13 percent to 9 percent starting April 1, 2027, which may trigger a short-term rush in exports before pushing automakers to speed up overseas plant construction and upgrade their global strategies.
Source: Jiemian News and market data, October 2026.
