China's New Rules Force EV Batteries to Stay With the Car Through Scrapping

China's Ministry of Industry and Information Technology, together with the All-China Federation of Supply and Marketing Cooperatives, issued a new policy in April 2026 standardizing lithium-ion battery recycling and formally extending regulatory oversight across a vehicle's entire battery lifecycle.

The centerpiece is a "vehicle-body integration" scrapping rule: end-of-life EVs must be scrapped with their batteries still installed, closing off the informal channel where batteries were pulled and resold or processed outside regulated recycling infrastructure before the vehicle itself was scrapped.

Every battery gets a code at production that follows it through manufacture, installation, use, repair, and eventual recovery, reported into a national traceability platform that every actor in the chain — makers, automakers, service shops, recyclers — is required to feed data into.

The policy reaches beyond domestic manufacturers too: foreign battery makers selling into China were required to establish their own domestic recycling infrastructure, or certify a partnership with an approved processor, to maintain market access past April 1, 2026.

This is regulation creating a closed-loop supply chain by mandate rather than the market discovering it organically — China is betting that guaranteed access to its own retired-battery stream, rather than continued reliance on freshly mined lithium, cobalt, and nickel, is a more durable input-cost and geopolitical-exposure advantage for its EV industry.

For any company sourcing battery materials or selling into the Chinese EV supply chain, the traceability platform is the detail to watch — it's the infrastructure that makes the rest of the policy enforceable, and it's the kind of requirement that tends to get copied by other markets once one country proves it works at scale.