China has become the largest electric vehicle (EV) market in the world since 2015. Consequently, the lithium-ion battery (LiB) market in China is also expanding fast. LiB makers are continually introducing new types of LiBs into the market to improve LiBs’ performance. However, there will be a considerable amount of waste LiBs generated in China. These waste LiBs should be appropriately recycled to avoid resources’ waste or environmental pollution problems. Yet, because LiBs’ type keeps changing, the environmental impact and profitability of the waste LiB recycling industry in China become uncertain. In this research, we reveal the detailed life cycle process of EVs’ LiBs in China first. Then, the environmental impact of each type of LiB is speculated using the life cycle assessment (LCA) method. Moreover, we clarify how LiBs’ evolution will affect the economic effect of the waste battery recycling industry in China. We perform a sensitivity analysis focusing on waste LiBs’ collection rate. We found that along with LiBs’ evolution, their environmental impact is decreasing. Furthermore, if waste LiBs could be appropriately recycled, their life cycle environmental impact would be further dramatically decreased. On the other hand, the profitability of the waste battery recycling industry in China would decrease in the future. Moreover, it is essential to improve waste LiBs’ collection rate to establish an efficient waste LiB industry. Such a trend should be noticed by the Chinese government and waste LiB recycling operators to establish a sustainable waste LiB recycling industry in the future.
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