Chinese battery giant and Tesla supplier CATL is expanding globally: Here’s why it matters

The world's largest electrical conveyance (EV) is going all-in connected planetary enlargement and could shingle up the EV marketplace successful the process with its battery-swapping tech rollout.

China's Contemporary Amperex Technology Co. Ltd. (CATL) is simply a cardinal subordinate successful the planetary modulation to much sustainable transport, with a marketplace stock successful the EV assemblage of roughly 38%. CATL's clients see planetary players similar Tesla, Volkswagen and BMW, with the steadfast boasting technology acold superior to that of Western competitors. 

Despite its outsized interaction connected the EV industry, the institution had mostly flown nether the radar until May this year, erstwhile it launched the world's largest archetypal nationalist offering (IPO) of 2025 to day successful Hong Kong. 

The IPO raised 41 cardinal Hong Kong dollars ($5.2 billion), aft CATL stocks surged and an over-allotment enactment was afloat exercised. 

Here is what CATL has successful the works pursuing its IPO.

Ahead of its nationalist offering, CATL said 90% of the funds raised by going nationalist would beryllium enactment toward its enlargement into Europe, peculiarly its under-construction mill successful Hungary. 

The company's 7.6-billion-euro ($8.2 billion) concern into the Debrecen artillery works was archetypal announced successful August 2022 and is expected to statesman production this year. 

The artillery shaper has already established a wholly owned manufacturing basal successful Germany, which archetypal opened successful 2023. It has besides announced plans to physique a artillery works successful Spain done a joint venture with Stellantis. 

CATL's planetary investments travel a inclination of much Chinese EV companies, including car elephantine BYD, shifting to Europe amid assertive contention and terms wars successful the home market. 

Speaking astatine the World Economic Forum successful Tianjin, China, connected Thursday, Ni Jun, CATL's main manufacturing officer, said the brutal discount warfare would not extremity without involution from Beijing. 

He added that, if a large subordinate continues to chopped prices, it could pb to different competitors being driven retired of the marketplace and make a monopoly. While CATL's Jun did not sanction immoderate companies, CATL's main rival BYD announced terms cuts successful precocious May. 

Tight margins and overcapacity successful China person been a driving unit successful CATL's Europe push, said Tu Le, laminitis and managing manager of Sino Auto Insights, adding that the institution is already supplying "virtually every" EV shaper successful China, limiting home maturation opportunities. 

But not everything successful Europe has been easy. The bloc placed punitive tariffs connected made-in-China EVs past year, pursuing an adjacent much severe crackdown in the U.S. 

Le said that the Hungary installation is different large measurement toward the company's localization plans and that it volition pb to little labour costs and a geopolitically friendlier situation erstwhile compared to Germany. 

CATL is besides progressive successful an integrated electrical conveyance artillery project successful Indonesia. According to section media reports, authorities officials expect accumulation to statesman successful March 2026, which could springiness CATL a beingness successful the increasing EV market of Southeast Asia. 

CATL said successful a caller interrogation with The Financial Times that it besides plans to rotation retired its battery-swapping and recycling exertion to Europe, successful a determination that could person important ramifications for the determination market. CNBC has contacted CATL for further details. 

Modern battery-swapping technology, portion fashionable successful China, is yet to instrumentality disconnected successful Europe. Chinese EV shaper and battery-swapping pioneer Nio is 1 exception. The institution has introduced 60 artillery swap stations crossed Germany, the Netherlands, Norway, Sweden and Denmark.

Jeep and Dodge shaper Stellantis, meanwhile, precocious partnered with U.S.-based Ample to integrate artillery swapping exertion to a fleet of 100 Fiat 500 EVs successful Madrid, Spain.

The acquisition of utilizing a artillery swap presumption is thought to beryllium precise akin to utilizing an automated car wash. The EV operator parks the car connected a level with an integrated system, which removes the depleted artillery from beneath the conveyance and replaces it with a fresh, afloat charged one. The full process takes astir 5 minutes.

Advocates of artillery charging done a swapping presumption accidental the exertion solves a fig of issues, peculiarly relating to accelerated charging and semipermanent show — 2 large sticking points for the wide adoption of EVs.

Analysts accidental different cardinal payment to swapping is that it allows car manufacturers to support ownership of the battery, which lowers the archetypal terms of the conveyance and creates a regular gross watercourse for the OEMs.

Some drawbacks, however, see precocious archetypal infrastructure costs and a deficiency of standardization crossed car manufacturers.

Connor Watts, artillery earthy materials expert astatine consultancy Fastmarkets, said CATL, which has a fig of partnerships with Chinese OEMs, is good positioned to instrumentality the indispensable level of merchandise standardization crossed its lawsuit base.

"And peculiarly pursuing its caller influx of currency from its Hong-Kong listing, it has the indispensable superior to make infrastructure wrong the European market," Watts told CNBC by email.

"Of companies that could win successful processing the European artillery swapping industry, nary are amended placed than CATL considering its marketplace position," helium added.

Julia Poliscanova, elder manager for vehicles and e-mobility proviso chains astatine the run radical Transport & Environment, said large carmakers would person to hold to a standardized compartment plan for battery-swapping exertion to enactment astatine standard successful Europe.

"Battery swapping is simply a bully summation to the charging space, and successful immoderate parts of the marketplace it makes consciousness … but it is not a metallic slug to lick our problems," Poliscanova told CNBC by phone.

"We volition inactive request batteries and we volition inactive request materials for them, whether they are swapped oregon whether they are successful the car permanently," she added.