Spot price fluctuations of battery-grade lithium carbonate and supply chain disruptions: The survival game of new energy enterprises

Amid the global energy transition, China's new energy industry has rapidly grown. Lithium-ion batteries, central to new energy vehicles and energy storage systems, rely on battery-grade lithium carbonate as a core material. From 2020 to 2023, the spot price of battery-grade lithium carbonate fluctuated drastically, from stagnation and recovery to sharp rises and declines, disrupting the new energy supply chain. This underscores the need to strengthen the security of the industry and supply chain. Our study, based on data from new energy listed companies for eight quarters from Q2 2021 to Q1 2023, uses fixed effect models and generalized additive models to explore the relationship between the spot price fluctuations of battery-grade lithium carbonate and the inventory turnover time of new energy enterprises. The study finds that first, changes in battery-grade lithium carbonate prices exert a significant negative impact on enterprises' inventory turnover time. Second, enterprises with weaker bargaining power adopt more aggressive inventory reduction strategies. Third, during the early stage of lithium carbonate price surges, some companies engaged in stockpiling to alleviate potential subsequent inventory pressure, which ultimately led to over-adjusted turnover times in later periods. Compared to previous literature, this paper breaks through the linear analysis paradigm and reveals the underlying changes in supply chain shocks through the GAM model, providing new empirical evidence for the management of new energy supply chains. We advocate for a collaborative mechanism to mitigate supply chain shocks from price fluctuations.