China’s electric vehicle industry has entered a new regulatory phase with the implementation of two mandatory national safety standards that require traction batteries to prevent fires and explosions following thermal runaway.
The standards, GB 38031-2025 for traction battery safety and GB 18384-2025 for vehicle safety, came into effect on July 1, introducing the country’s most stringent electric vehicle safety requirements to date.
Battery Safety Shifts to Prevention
The updated battery standard fundamentally changes how battery safety is evaluated.
Under previous regulations, battery systems were permitted to catch fire or explode after thermal runaway, provided occupants received a warning at least five minutes beforehand.
The new rules instead require system-level intrinsic safety, meaning batteries must achieve “no fire, no explosion” even after thermal runaway occurs in a single battery cell.
To better reflect real-world operating conditions, regulators have also introduced mandatory bottom-impact testing and long-term fast-charging cycle tests, addressing damage caused by underbody impacts and repeated ultra-fast charging.
New Vehicle-Level Safety Requirements
Alongside the battery regulations, China has strengthened vehicle-level safety by requiring an independent physical emergency power shut-off system.
Previously, high-voltage circuits were disconnected through software commands from the vehicle’s control system.
Under the new rules, drivers must be able to disconnect the high-voltage system within one second using a dedicated physical button that operates independently of the vehicle’s main software, improving safety following severe collisions.
Compliance Costs Rise
Major battery manufacturers have already aligned their technologies with the new standards.
CATL said it commercialized its first no-thermal-propagation battery technology in 2020, while Eve Energy reported that both its lithium iron phosphate (LFP) and ternary battery systems achieved the required “no fire, no explosion” performance in 2022.
However, industry estimates suggest compliance will increase battery system costs by 15% to 20%, adding approximately 3,000 to 5,000 yuan (about US$440 to US$700) to the cost of each battery pack.
The additional investment is expected to place greater pressure on smaller battery manufacturers and lower-priced electric vehicle models, while companies with more advanced battery technologies are expected to adapt more easily.
LFP Batteries Gain Further Advantage
The stricter safety requirements are also expected to reinforce the market position of lithium iron phosphate (LFP) batteries.
Because of their higher intrinsic thermal stability, LFP batteries require fewer modifications to comply with the new standards than some alternative battery chemistries, potentially strengthening their market share as manufacturers prioritize safety and cost efficiency.
The regulations take effect as China’s battery market enters a slower growth phase.
According to the National Power Battery Innovation Center, domestic traction battery installations are projected to reach 888.7 GWh in 2026, representing 15.8% year-on-year growth, compared with more than 40% growth recorded in 2025.
Despite moderating overall demand, commercial new energy vehicles are expected to remain the industry’s fastest-growing segment, with battery installations forecast to increase 34.7% during 2026, significantly outpacing growth in the passenger vehicle market.
Source: CnEVPost
