China based World’s Largest battery maker announces financial support for its old suppliers to speed up technology innovation and signs JV to start production of batteries in Spain
Targeted to start production by end of 2026 at Stellantis' Zaragoza, Spain site, the facility could reach up to 50 GWh capacity, subject to the evolution of the electrical market in Europe and continued support from authorities in Spain and the European Union. The 50-50 joint venture between CATL and Stellantis will boost Stellantis' best-in-class LFP offer in Europe enabling the automaker to offer more high-quality, durable and affordable battery-electric passenger cars, crossovers and SUVs in the B and C segments with intermediate ranges.
SHANGHAI, Dec 14 (The HQ News) – China based world’s largest battery maker CATL has announced to its old suppliers its willingness to provide them with financial support to speed up technology innovation in battery materials and equipment, part of efforts to relieve stress on its supply chain amid a brutal EV price war.
CATL is willing to take on part of their Research and Development costs and make advance payments for projects to ensure technologies make progress, according to a CATL letter simply dated Dec, 2024 to suppliers, the letter claims it would help suppliers with certification work to accelerate the application and production of new battery materials and help them boost market share.
Over the past two years, fierce price competition in China as it being the world’s biggest and most advanced electric vehicle market has put automakers and suppliers under great pressure to reduce costs.
Electric Vehicle (EV) giant BYD is poised to sell more cars than either Ford or Honda do globally, driving sales with relentless discounts in its home market where it sells 90% of its cars. It has asked some of its suppliers to cut their prices further next year, a sign that the price war will only increase.
Industry executives and analysts have warned that the price war will force companies to reduce investment in R&D as their profitability weakens.
CATL has extended its leadership in EV batteries with a global market share of 36.8% in the first 10 months of the year, increasing from 35.9% in the same period in 2023, according to SNE Research. South Korea’s LG Energy Solution saw its market share shrink to 11.8% from 13.9%.
This week CATL announced a third European factory to be built in a venture with Stellantis in Spain. Zeng said its first two factories in Europe would be profitable in 2025 and 2026.
CATL and Stellantis on 10th Dec 2024 announced they have reached an agreement to invest up to €4.1 billion to form a joint venture that will build a large-scale European lithium iron phosphate (LFP) battery plant in Zaragoza, Spain. Designed to be completely carbon neutral, the battery plant will be implemented in several phases and investment plans.
Targeted to start production by end of 2026 at Stellantis’ Zaragoza, Spain site, the facility could reach up to 50 GWh capacity, subject to the evolution of the electrical market in Europe and continued support from authorities in Spain and the European Union. The 50-50 joint venture between CATL and Stellantis will boost Stellantis’ best-in-class LFP offer in Europe enabling the automaker to offer more high-quality, durable and affordable battery-electric passenger cars, crossovers and SUVs in the B and C segments with intermediate ranges.
Earlier in November 2023, Stellantis and CATL signed a non-binding MOU for the local supply of LFP battery cells and modules for electric vehicle production in Europe and established a long-term collaboration on two strategic fronts: creating a bold technology roadmap to support Stellantis’ advanced battery electric vehicles (BEV) and identifying opportunities to further strengthen the battery value chain.