Competition among electric vehicle (EV) battery manufacturers has grown intense, prompting prominent maker CATL to speed up expansion outside China. The battery giant is about to commission its first plant in Europe, actively looking for opportunities in South Korea. Moreover, North America is reportedly where the company will soon set up a production base.
Accelerating localization in Europe
CATL broke ground on its German plant, Contemporary Amperex Technology Thuringia GmbH (CATT), three years ago. It was CATL’s first factory overseas and Germany’s first battery plant.
In early April this year, CATT received approval from the state of Thuringia for battery cell production, with an initial annual capacity of 8GWh. The battery manufacturer expects to commission the plant later this year and eventually bring up the capacity to 14 GWh.
“Situated in the heart of Germany, the plant is within a short distance to major customers such as BMW, VW and Daimler, which means we can better respond to our customers and cut shipment costs,” CATL told DIGITIMES Asia in an email.
The company has been developing a supply chain in Europe to improve local service and secure raw materials. In September 2021, it announced a strategic partnership with German chemicals producer BASF for cathode active materials and battery recycling.
Two months later, CATL established a global strategic partnership with ZF Group, a Germany-based car parts maker, for aftermarket services and the repurpose and remanufacturing of batteries, CATL said.
Several challenges lie ahead while the battery maker keeps localizing itself in Europe. For example, South Korean competitors such as LG Energy Solution (LGES) and Samsung SDI already operate production bases in the continent. In addition, Europe-based battery startups like Northvolt and Britishvolt are aggressively building their momentum.
Source: SNE Research, complied by DIGITIMES Asia April 2022
Scouting South Korea and North America for opportunities
In addition to Europe, CATL is actively looking for ways to gain a presence in South Korea and North America. The company is one of the battery suppliers for Hyundai Motors’ E-GMP and licenses its cell-to-pack (CTP) technology to Hyundai Mobis.
According to South Korean media reports, CATL set up a regional office in the country last year.
The company told DIGITIMES Asia that South Korea is a very important player and a market in the sector of e-mobility and energy transition.
“We hope to join hands with more partners in the industry of the South Korean market to support the achievement of carbon neutrality targets of South Korea as well as the world,” CATL said.
On the other hand, North America is the market that no company would want to miss. Bloomberg recently disclosed that CATL is considering sites in Canada, the US and Mexico to build a production base with a capacity of 80GWh per year.
While not commenting on the reported project in North America, CATL said it considers multiple factors like market demand, investment environment, local supply chain development, labor availability and cost level when developing investment plans overseas.
Technology innovation to keep front-runner position
Demand for EV batteries will keep growing as the global automotive industry is on course to electrification. According to South Korea-based SNE Research, battery installation volume worldwide increased more than 102% from 2020 to 2021.
CATL said the technology of mass-produced lithium-ion batteries in the next five years would focus on high energy density, long service life, super-fast charging and enhanced battery safety.
There would be no shortage of challenges in the market. To secure its world-leading position, CATL said it keeps innovating battery system structure and chemistry, lowering production failure rate and diversifying business models.
The company recently launched its third-generation CTP technology, called Qilin Battery internally. According to CATL, Qilin can deliver 13% more power than the 4680 battery with the same chemical system and pack size. It is one of the company’s strategies to address range anxiety.
As for battery material innovation, CATL unveiled its sodium-ion battery in July 2021. The battery contains an energy density of up to 160Wh/kg and holds a capacity retention rate of more than 90%, even in a low-temperature environment.
In an email to DIGITIMES Asia, the company said it has started cooperation with carmakers and energy storage companies in the commercialization of the technology. It will build a preliminary industrial chain by 2023.
CATL also intends to use sodium and lithium-based cells in one battery pack, called the AB battery system. The company said the design would leverage the benefits of both chemistries and create more application scenarios for sodium-lithium battery systems.