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Front. Eng    2022, Vol. 9 Issue (3) : 473-485    https://doi.org/10.1007/s42524-022-0213-5
RESEARCH ARTICLE
Evaluating R&D efficiency of China’s listed lithium battery enterprises
Shizhen BAI1, Xinrui BI1, Chunjia HAN2, Qijun ZHOU3, Wen-Long SHANG4(), Mu YANG2, Lin WANG5, Petros IEROMONACHOU3, Hao HE1
1. School of Management, Harbin University of Commerce, Harbin 150028, China
2. Department of Management, Birkbeck, University of London, London WC1E 7HX, UK
3. Department of Systems Management and Strategy, University of Greenwich, London SE10 9LS, UK
4. Beijing Key Laboratory of Traffic Engineering, College of Metropolitan Transportation, Beijing University of Technology, Beijing 100124, China; School of Traffic and Transportation, Beijing Jiaotong University, Beijing 100008, China; Centre for Transport Studies, Imperial College London, London SW7 2AZ, UK
5. School of Business Administration, Chongqing Technology and Business University, Chongqing 400067, China
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Abstract

Promoting the growth of the lithium battery sector has been a critical aspect of China’s energy policy in terms of achieving carbon neutrality. However, despite significant support on research and development (R&D) investments that have resulted in increasing size, the sector seems to be falling behind in technological areas. To guide future policies and understand proper ways of promoting R&D efficiency, we looked into the lithium battery industry of China. Specifically, data envelopment analysis (DEA) was used as the primary approach based on evidence from 22 listed lithium battery enterprises. The performance of the five leading players was compared with that of the industry as a whole. Results revealed little indication of a meaningful improvement in R&D efficiency throughout our sample from 2010 to 2019. However, during this period, a significant increase in R&D expenditure was witnessed. This finding was supported, as the results showed that the average technical efficiency of the 22 enterprises was 0.442, whereas the average pure technical efficiency was at 0.503, thus suggesting that they were suffering from decreasing returns to scale (DRS). In contrast, the performance of the five leading players seemed superior because their average efficiency scores were higher than the industry’s average. Moreover, they were experiencing increasing scale efficiency (IRS). We draw on these findings to suggest to policymakers that supporting technologically intensive sectors should be more than simply increasing investment scale; rather, it should also encompass assisting businesses in developing efficient managerial processes for R&D.
Keywords Data Envelopment Analysis      R&D investment efficiency      China’s listed lithium battery enterprises      technical efficiency      pure technical efficiency      scale efficiency     
Corresponding Author(s): Wen-Long SHANG   
About author:

Tongcan Cui and Yizhe Hou contributed equally to this work.
Just Accepted Date: 23 June 2022   Online First Date: 11 August 2022    Issue Date: 05 September 2022
 Cite this article:   
Shizhen BAI,Xinrui BI,Chunjia HAN, et al. Evaluating R&D efficiency of China’s listed lithium battery enterprises[J]. Front. Eng, 2022, 9(3): 473-485.
 URL:  
https://academic.hep.com.cn/fem/EN/10.1007/s42524-022-0213-5
https://academic.hep.com.cn/fem/EN/Y2022/V9/I3/473
Index category Standard level Index name Data source
Input index R&D manpower The number of technical personnel Corporate annual report
The proportion of technical personnel Corporate annual report
R&D expenses R&D expenditure Corporate annual report
The proportion of R&D expenditure Corporate annual report
Output index Technical improvement The number of patent applications State Intellectual Property Office
Economic benefit Operating income Corporate annual report
Net profit Corporate annual report
Tab.1  R&D efficiency evaluation index system for listed lithium battery enterprises
Industrial chain link Name Main points
Cell and battery pack BYD Establish the world’s leading technical and cost advantages in the field of power batteries
Lithium raw materials Tianqi Lithium It is one of the few enterprises in the world that simultaneously distribute two kinds of raw material resources: High-quality lithium mine and salt lake brine mine
Ganfeng Lithium It is the world’s leading lithium ecological enterprise, with the production capacity of more than 40 kinds of lithium compounds and metal lithium products in five categories
Anode materials Hunan Zhongke Electric Graphite powder processing technology is internationally advanced; heat treatment process and graphite composite technology are leading in China
Cathode materials Beijing Easpring Material Technology Leading enterprise in lithium battery cathode material industry
Tab.2  Introduction of five leading enterprises
Year Technical efficiency Pure technical efficiency Scale efficiency RTS
2010 1.000 1.000 1.000 –
2011 0.981 0.986 0.995 irs
2012 1.000 1.000 1.000 –
2013 1.000 1.000 1.000 –
2014 0.986 1.000 0.986 irs
2015 1.000 1.000 1.000 –
2016 0.997 1.000 0.997 drs
2017 1.000 1.000 1.000 –
2018 0.960 0.981 0.978 irs
2019 1.000 1.000 1.000 –
Average 0.992 0.997 0.996
Tab.3  Efficiency scores and RTS of the whole lithium battery industry in 2010–2019
Fig.1  The growth ratio of R&D investment inputs and outputs (Note: The calculation of growth ratio is based on the data of 2010, all the indicators from the other years compared with the data from 2010. For example, the net profit growth ratio 2019 = (net profit 2019 ? net profit 2010)/net profit 2010).
Fig.2  The changing trend of average efficiency scores of 22 listed lithium battery enterprises from 2010 to 2019.
Fig.3  The changing trend of the RTS of 22 listed lithium battery enterprises from 2010 to 2019.
Number Name TE PTE SE RTS
2010 2019 2010 2019 2010 2019 2010 2019
1 Guangdong Fenghua Advanced Technology 0.457 0.170 0.491 0.212 0.931 0.801 irs drs
2 Hengdian Group DMEGC Magnetics 0.286 0.330 0.286 0.523 0.999 0.631 – drs
3 Guoxuan High-tech 0.397 0.115 0.532 0.118 0.747 0.974 irs irs
4 Suzhou Good-Ark Electronics 0.326 0.331 0.436 0.396 0.749 0.837 irs irs
5 Sinoma Science & Technology 0.228 0.443 0.248 0.950 0.918 0.466 irs drs
6 Do-Fluoride Chemicals 0.483 0.266 0.573 0.274 0.843 0.971 irs irs
7 Ganfeng Lithium 0.632 0.829 0.782 0.895 0.809 0.926 irs drs
8 Tianqi Lithium 0.589 0.277 0.830 0.503 0.710 0.551 irs irs
9 BYD 0.644 1.000 0.685 1.000 0.941 1.000 irs –
10 Eve Energy 0.520 0.250 0.665 0.509 0.782 0.492 irs drs
11 Hunan Zhongke Electric 0.781 0.315 0.793 0.375 0.985 0.840 irs irs
12 Beijing Easpring Material Technology 0.675 0.433 0.782 0.487 0.863 0.888 irs irs
13 Sunwoda Electronic 0.237 0.326 0.277 0.379 0.856 0.860 irs drs
14 Wanxiang Qianchao 0.210 0.336 0.268 0.337 0.783 0.994 drs irs
15 Shenzhen CLOU Electronics 0.435 0.123 0.441 0.126 0.988 0.975 irs irs
16 Shenzhen Topband 0.511 0.146 0.515 0.190 0.991 0.771 irs drs
17 Zhejiang Unifull Industrial Fibre 1.000 0.304 1.000 0.420 1.000 0.723 – irs
18 Zhejiang Narada Power Source 0.596 0.398 0.624 0.400 0.955 0.996 irs drs
19 China CSSC Holdings 1.000 0.461 1.000 0.585 1.000 0.788 – drs
20 Jiangsu Zhongtian Technology 0.408 1.000 0.412 1.000 0.990 1.000 drs –
21 Neusoft Corporation 0.042 0.047 0.063 0.059 0.665 0.786 drs drs
22 Shenzhen Capchem Technology 1.000 0.304 1.000 0.316 1.000 0.960 – drs
Mean 0.521 0.373 0.577 0.457 0.887 0.829
Tab.4  Efficiency scores of R&D investments in 22 China’s listed lithium battery enterprises in 2010 and 2019, respectively
Fig.4  The comparison of PTE and TE scores of 22 enterprises in 2010 and 2019, respectively.
Year BYD Tianqi Lithium Hunan Zhongke Electric Ganfeng Lithium Beijing Easpring Material Technology
2010 0.644 0.589 0.781 0.632 0.675
2011 0.578 0.567 0.671 0.472 0.534
2012 0.624 0.505 0.692 0.418 0.624
2013 0.618 0.736 0.674 0.696 0.618
2014 0.736 0.783 0.734 0.706 0.679
2015 1.000 0.900 0.996 0.392 0.598
2016 1.000 1.000 1.000 0.470 0.470
2017 0.993 0.865 0.491 1.000 0.452
2018 0.922 0.507 0.363 0.275 0.391
2019 1.000 0.277 0.315 0.829 0.433
Average 0.812 0.673 0.672 0.589 0.547
Rank 1 2 3 4 5
Tab.5  Technical efficiency scores of five leading enterprises from 2010 to 2019
Year BYD Tianqi Lithium Hunan Zhongke Electric Ganfeng Lithium Beijing Easpring Material Technology
2010 0.685 0.830 0.793 0.782 0.782
2011 0.642 0.793 0.690 0.602 0.611
2012 0.629 0.719 0.721 0.529 0.663
2013 0.628 0.946 0.715 0.702 0.675
2014 0.736 1.000 0.748 0.706 0.717
2015 1.000 0.979 1.000 0.399 0.652
2016 1.000 1.000 1.000 0.626 0.505
2017 1.000 1.000 0.521 1.000 0.493
2018 0.924 0.612 0.409 0.285 0.506
2019 1.000 0.503 0.375 0.895 0.487
Average 0.824 0.838 0.697 0.653 0.609
Rank 2 1 3 4 5
Tab.6  Pure technical efficiency scores of five leading enterprises from 2010 to 2019
Year BYD Tianqi Lithium Hunan Zhongke Electric Ganfeng Lithium Beijing Easpring Material Technology
2010 0.941 irs 0.710 irs 0.985 irs 0.809 irs 0.863 irs
2011 0.899 irs 0.714 irs 0.972 irs 0.784 irs 0.874 irs
2012 0.992 irs 0.703 irs 0.960 irs 0.790 irs 0.941 irs
2013 0.984 drs 0.777 irs 0.942 irs 0.991 irs 0.916 irs
2014 1.000 – 0.783 irs 0.981 irs 1.000 – 0.948 irs
2015 1.000 – 0.919 irs 0.996 irs 0.984 drs 0.917 irs
2016 1.000 – 1.000 – 1.000 – 0.751 drs 0.931 irs
2017 0.993 drs 0.865 drs 0.943 irs 1.000 – 0.918 irs
2018 0.998 irs 0.828 irs 0.889 irs 0.963 drs 0.773 irs
2019 1.000 – 0.551 irs 0.840 irs 0.926 drs 0.888 irs
Average 0.981 0.785 0.951 0.900 0.897
Rank 1 5 2 3 4
Tab.7  Scale efficiency scores of five leading enterprises from 2010 to 2019
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