Unlock Editor’s Digest for free
FT editor Roula Khalaf has chosen her favorite stories in this weekly newsletter.
CATL and Stellantis will build a 4.1 billion euro lithium battery factory in Spain, expanding China’s manufacturing presence in Europe and supporting European automakers’ pivot to electric vehicles.
The factory in Zaragoza, northeastern Spain, will begin production by the end of 2026 under a 50-50 joint venture between the world’s largest battery maker and the fourth-largest carmaker, which owns the Peugeot, Jeep and Fiat brands. It’s planned.
Europe is trying to reduce its dependence on Chinese batteries by investing in developing Chinese battery technology. But those efforts have stumbled, with Northvolt, the battery’s biggest hope, filing for Chapter 11 bankruptcy in the United States.
Stellantis is open to partnering with Chinese companies, even though the group is in crisis after management turmoil and declining sales in the United States and Europe.
After winding down its operations in China, the European carmaker has acquired a 20% stake in Chinese start-up Leap Motor for €1.5 billion, giving it exclusive rights to manufacture and sell Leap Motor cars outside China through a joint venture. Gave.
Meanwhile, Leap Motor is using its Stellantis factory in Poland to produce the small EV “T03” to avoid increased EU tariffs on Chinese EV imports.
Recommended
CATL, headquartered in the eastern Chinese city of Ningde, gained about 38% global market share in the first half of the year, according to SNE Research. The company boasts industry-leading economies of scale and research spending, and its sales have been supported by the Chinese market amid volatile EV demand in Europe and the United States.
The Spanish factory is CATL’s third major investment in Europe. It already operates factories in Germany and Hungary.
The deal is part of Brussels’ plan to force Chinese companies to transfer intellectual property to European companies in exchange for EU subsidies, as part of a strengthened trade regime for clean technologies, as reported by the Financial Times last month. It was done nevertheless.
The Chinese group, a major Tesla supplier, is working to expand in Europe as tensions between China and the United States threaten its growth plans in North America.
CATL is also working with Elon Musk’s company and Ford to license battery manufacturing technology to factories in Nevada and Michigan, respectively.
Stellantis Chairman John Elkann said the group is “employing all available advanced battery technologies to deliver competitive electric vehicle products to our customers.”
Elkann is chairing the interim executive committee as the group searches for a new chief executive following the sudden resignation of Carlos Tavares following a sharp deterioration in financial performance. .
CATL’s decision is ultimately a victory for Spain, the EU’s second-largest car producer after Germany, even though all its factories are owned by companies outside Spain.
The country is struggling to maintain its relevance as industry shifts to electric vehicles, with the Socialist Party-led government in October nominating one Zaragoza project to be funded by the EU’s post-pandemic recovery funds. It was trying to persuade Stellantis by offering a subsidy of 333 million euros.
Prime Minister Pedro Sánchez met with CATL Chairman and CEO Robin Zeng at his official residence in Madrid on Monday. The prime minister said the Chinese group welcomed Spain’s “firm commitment” to decarbonisation, but made no mention of an imminent announcement. Sanchez has been more active in courting China than many other EU leaders, meeting with President Xi Jinping in Beijing in September for the first time in a year and a half.
During that visit, Sanchez caught EU countries by surprise by declaring that they needed to “reconsider” plans to impose tariffs on Chinese electric cars. When EU member states approved EV tariffs in October, Spain ultimately abstained from the vote, arguing that further dialogue and negotiations were needed.
Jorge Ascon, the conservative president of Aragon, whose commercial center is Zaragoza, said the announcement was “the best possible news” and would “fix the future of a strategic sector” in the region. He said it would be.
