New management regulations take effect april 1: How Auto Repair Shops Should Handle Battery Repair and Recycling

In 2026, as the market share of new energy vehicles approaches a critical threshold, their after-sales service market—and that of traditional internal combustion engine vehicles—is entering a new developmental phase characterized by “decline of the latter and rise of the former.”

According to data released by authoritative agencies, 12.93 million new energy vehicles (NEVs) were newly registered nationwide in 2025, accounting for 49.38% of all new vehicle registrations that year. By the end of 2025, the total NEV fleet in China had reached 43.97 million, representing approximately 12% of the country's total vehicle fleet. In 2026, annual NEV sales are expected to surpass 16 million units, and the total NEV fleet is projected to exceed 60 million by year-end.

Corresponding to the rapidly growing new energy vehicle market, the recycling of spent power batteries has also become a rapidly expanding blue ocean in the post-market of new energy vehicles.

In 2025, China's comprehensive utilization volume of waste power batteries from new energy vehicles has exceeded 400,000 metric tons, an increase of 32.9% year-on-year. It is projected that by 2030, as a large number of new energy vehicles with ages of 6–8 years reach end-of-life or undergo battery replacement, the domestic market for comprehensive utilization of waste power batteries will surpass RMB 100 billion.

Although the terms "battery maintenance, recycling, and comprehensive utilization" are already well-known in the automotive after-sales industry, how these emerging businesses can be integrated with automotive repair services, and how they can play a role in service upgrading and transformation of service workshops, as well as how automotive after-sales workshops can tap into profit opportunities in these rapidly growing areas, have become issues that the industry cannot ignore and must seriously consider.

01. New management regulations released, setting the overall tone for the development of the power battery ecosystem

For a long time, the domestic secondary power battery recycling and comprehensive utilization market has been characterized by fragmented development, rapid growth, and disorderly competition, with frequent safety accidents and product quality disputes.

In response to the upcoming large-scale retirement of power batteries, to standardize the comprehensive utilization management of spent power batteries, on January 16, 2026, the Ministry of Industry and Information Technology and five other departments jointly issued the "Interim Measures for the Recycling and Comprehensive Utilization Management of New Energy Vehicle Spent Power Batteries" (hereinafter referred to as the "Management Measures"). This marks that China's spent power battery recycling and utilization sector has officially entered a new phase of legalized and standardized management.

The Management Measures follow the "full channel, full chain, full life cycle" management approach, aiming to strengthen full-chain management through legal means. It is expected to have a significant impact on the market for battery maintenance, recycling, and comprehensive utilization in the following six aspects:

• Stricter definition of waste power batteries

In the definition of waste power batteries, it is clearly stated that power batteries that have lost their original use value and are discarded during the processes of R&D, production, testing, installation, storage, transportation, use, maintenance, and vehicle scrapping all belong to the category of waste power batteries.

In the future, waste power batteries will not be limited to batteries that have undergone maintenance, replacement, or scrapping; defective battery cells produced by power battery manufacturers—traditionally regarded as equivalent to new spare parts—will also be included in the management scope of waste power batteries.

• Upgraded Full-Cycle Traceability Management for Spent Power Batteries

The Ministry of Industry and Information Technology, in conjunction with relevant State Council departments, has established a national information platform for the traceability of power batteries for New Energy Vehicles (NEVs). This platform is designed to monitor and trace the full lifecycle flow of power batteries for NEVs.

First, all new energy vehicle traction batteries will be assigned a "digital ID." Each battery cell, module, and battery pack will be clearly marked with a unique, accurate, legible, visible, durable, and tamper-resistant code.

Secondly, relying on the power battery traceability information platform and using the "digital ID" information of power batteries as the carrier, it will link the entire process information related to the production, sales, maintenance, replacement, dismantling, recycling, and comprehensive utilization of power batteries, achieving full lifecycle flow monitoring and information traceability.

• The disassemblability of power batteries and the transparency of technical information are expected to improve.

The Measures require that manufacturers of new energy vehicles and enterprises importing new energy vehicles for sale in China shall, within six months after obtaining the announcement of new energy vehicle product access or the mandatory product certification for new energy vehicles, submit technical information on the disassembly and necessary dismantling of new energy vehicle power batteries.

For power batteries of new energy vehicles produced or imported for sale and use within the territory, standardized and easily disassemblable design solutions shall be prioritized, and non-toxic, harmless, or low-toxic, low-harm materials that facilitate recycling and reuse shall be used. New energy vehicle manufacturers shall, while ensuring safety, use power battery mounting and connecting components that are easy to maintain and dismantle.

• Clarification and Specification of Extended Producer Responsibility for Power Batteries

The Management Measures clearly require that power battery manufacturers and new energy vehicle manufacturers shall fulfill the extended producer responsibility. Power battery manufacturers are required to establish recycling service outlets in the provincial administrative regions where they sell new energy vehicle power batteries; new energy vehicle manufacturers are required to establish recycling service outlets in the municipal administrative regions where they sell new energy vehicles, and to take on the responsibility of recycling power batteries that are installed in vehicles. Relevant enterprises shall not refuse to recycle used waste power batteries transferred by motor vehicle repair enterprises, scrap vehicle recycling and dismantling enterprises, and other entities.

• The flow channels for used power batteries become clearer.

Waste battery collection service outlets established by battery manufacturers and new energy vehicle manufacturers in various regions will undertake the primary responsibility for collecting spent power batteries. Battery collection outlets, battery-swapping enterprises, motor vehicle repair enterprises, and end-of-life motor vehicle recycling and dismantling enterprises shall deliver the collected or self-removed spent power batteries to qualified comprehensive utilization enterprises for recycling and utilization.

• Regulatory efforts are being intensified, and violations will result in severe penalties.

Local people's governments at or above the county level, through their departments of industry and information technology, development and reform, ecology and environment, transportation, commerce, and market regulation, shall strengthen supervision and inspection of the recycling, comprehensive utilization, and related activities of waste power batteries within their respective regions and have the authority to take appropriate measures, including ordering corrections and imposing fines, against relevant enterprises.

If power battery manufacturers, new energy vehicle manufacturers, battery swap service companies, motor vehicle repair companies, scrap motor vehicle recycling and dismantling companies, and comprehensive utilization companies violate the provisions of the Management Measures and commit a crime, they will also be held criminally responsible.

02. New Battery Recycling Regulations Reshape the Development Trajectory of the New Energy Aftermarket

The issuance of the “Management Measures” is not only the overarching regulatory framework for the recycling and comprehensive utilization market of spent power batteries, but also a “barometer” for the development of China’s new energy vehicle aftermarket over the coming years.

• No longer adhering to the principle of "prioritized cascade utilization followed by recycling," the application scenarios for spent power batteries are being constrained.

The "Administrative Measures" define resource utilization activities for spent power batteries—including dismantling, crushing, sorting, and smelting—as no longer encompassing cascade utilization, effectively abandoning the industry's long-standing "cascade utilization followed by recycling" principle that has been in place for over a decade.

Meanwhile, it is explicitly stipulated that no organization or individual shall use waste power batteries—either directly or after processing—in electric bicycles or in other areas prohibited by laws, administrative regulations, and mandatory standards.

• In fact, the new regulations strictly restrict the application scenarios and scope of used batteries.

Affected are not only battery comprehensive utilization enterprises that previously focused primarily on cascade utilization; within the industry, there has been a practice for several years of using old battery packs and modules for repair and replacement—whether this practice will receive future policy support or face restrictions remains to be seen.

• Disclosure of power battery technology information may receive regulatory support for unauthorized repairs.

Under the premise of conducting business in accordance with laws and regulations, motor vehicle repair enterprises, enterprises engaged in scrapping and dismantling of motor vehicles, and comprehensive utilization enterprises may, via the National Traceability Information Platform for New Energy Vehicle Power Batteries, access technical information on power battery removal and dismantling published by new energy vehicle manufacturers and power battery producers, for purposes such as battery removal, dismantling, and repair.

• Maintenance and replacement of power batteries must be reported to the relevant authorities in accordance with the law.

According to the “Management Measures,” motor vehicle repair enterprises cooperating with new energy vehicle (NEV) manufacturers—primarily brand-authorized service enterprises—shall report battery replacement information to the NEV manufacturer within 15 days after repairing and replacing the power battery of an NEV. The NEV manufacturer shall report the battery replacement information on the system platform within 40 days after the NEV power battery replacement.

Motor vehicle repair enterprises that have not cooperated with new energy vehicle manufacturers (non-authorized service enterprises of brand manufacturers) shall report battery repair and replacement information to the National New Energy Vehicle Battery Traceability Information Platform within 40 days after repairing and replacing the new energy vehicle battery.

In case of violation of the provisions of the Management Measures, if relevant enterprises (power battery enterprises, new energy vehicle manufacturing enterprises, battery swap service enterprises, motor vehicle repair enterprises, scrap motor vehicle recycling and dismantling enterprises, and comprehensive utilization enterprises) refuse to report relevant information or report false information, the local people's government industrial and information technology, development and reform, ecological environment, transportation, commerce, and market supervision and administration departments at or above the county level shall order them to make corrections according to their respective responsibilities; if they refuse to make corrections, they will be given a warning or a fine of up to 30,000 yuan, and the directly responsible principal personnel and other responsible personnel will be fined up to 10,000 yuan.

• Illegal disposal of used power batteries will incur legal liability and penalties.

03. How Can Auto Service Stores Develop Business in the Post-Market of Power Batteries?

The "Interim Measures for the Management of Recycling and Comprehensive Utilization of Waste Power Batteries in New Energy Vehicles" will come into effect on April 1, 2026. Personally, I believe that the introduction of the new regulations is a compliance constraint for enterprises in the new energy after-sales market, including repair service outlets, but it is also an opportunity for the industry to upgrade and transform its operations in line with the trend.

Based on our observations and practical experience in the field of power battery after-sales service in recent years, we suggest that automotive repair service stores can focus on and take the following actions to respond effectively—

• Expand the comprehensive power battery business of the store, and quickly upgrade the service extension

• Operate in accordance with laws and regulations, ensuring safety and environmental protection in electric service.

Stores engaged in the maintenance, recycling, and service network operations of power batteries should first strictly abide by laws and regulations, ensuring safety and environmental protection. First, they must include relevant new energy business items in their business scope to ensure the company has the necessary operating qualifications. Second, technical operators must obtain and hold qualification certificates such as the "Special Operations Operation Certificate - Low Voltage Electrical Work" and the "Professional Competence Certificate in Transportation (New Energy Vehicle Inspection and Maintenance)", ensuring professional and safe operations and eliminating the occurrence of safety accidents.

In addition, the store shall establish an independent power battery operation area, strictly isolated from traditional fuel vehicle maintenance and parts storage areas. The area must be equipped with facilities for leakage prevention, fire prevention, and emergency fire protection. An emergency response plan shall be formulated, and high-voltage operation accident emergency drills shall be conducted regularly within the store.

• Compliant procurement and use of power batteries, standardization of information reporting and record keeping

Maintenance service stores shall not accept power batteries without codes, with abnormal labels, or of unknown origin, to avoid bearing legal liabilities by participating in the illegal handling of power batteries. When carrying out maintenance service technologies, enterprises can access the National New Energy Vehicle Power Battery Traceability Information Platform to query the disassembly and maintenance technical information and standard procedures of power batteries disclosed by vehicle manufacturers and power battery producers, optimize maintenance plans, reduce after-sales costs and risks, and continuously enhance professional capabilities.

When disposing of, repairing, replacing, or recycling old power batteries, the store should ensure that the downstream recycling companies have legal and compliant qualifications to avoid violating regulations.

In addition, maintenance service enterprises must promptly report relevant information—such as battery identification codes, removal times, and recipient entities—to the National New Energy Vehicle Power Battery Traceability Information Platform for power batteries subject to maintenance, replacement, or recycling. Enterprises must establish an internal electronic ledger covering “battery identification code – removal – registration – transfer – receipt,” and retain such records for no less than three years to ensure full traceability of information related to power battery services and consistency with data registered on the national platform.

Since the domestic power battery market has a short development history, the after-sales service ecosystem is not yet well-established, and the main development resources are controlled by original equipment manufacturers and power battery companies, there have been many pessimistic voices within the traditional after-sales service industry, believing that most traditional after-sales service workshops are basically excluded from this business.

However, in the long term, the after-sales service market for power batteries has the basic characteristics of "huge scale, fragmented industry, and high specialization." As the "capillaries" reaching the end market and user services, auto repair service stores still have the opportunity to play a significant role in this field.

In the short term, industry professionals must carefully study, invest necessary efforts and costs, and improve the project management system. In the long term, it is necessary to continuously pay attention to changes in the market model, actively develop and collaborate with high-quality partners within the new energy industry chain. By upgrading their own service content and efficiently leveraging mutual strengths, they can jointly build differentiated store operation projects and competitiveness. Ultimately, this will gradually shift from "oil and electric maintenance" to "full electrification" service upgrades, securing a ticket to the boom in the new energy vehicle after-sales market and future sustainable development.