Tesla supplier CATL receives approval for battery cell production in German

Contemporary Amperex Technology (CATL), China’s largest electric vehicle battery manufacturer, has received 2nd partial approval to produce battery cells in Thuringia, a state in the eastern part of Germany.

The plant is CATL’s first plant outside China, it will have an initial capacity of 8 GWh per year that is capable of equipping about 120,000 cars. Eventually, CATL plans to achieve a production capacity of 14 GWh.

The plant is being constructed in the final stage, and installation of machines is in the process for the first cells to be made by the end of 2022.

The approval of plant marks breakthrough of CATL’s European expansion despite the threat of the pandemic, it also means that CATL will get closer to its major customer Tesla, which opened its Gigafactory in Berlin, about 3.5-hour drive from Thuringia.

In addition to boosting production capacity in German, CATL’s chairman Zeng Yuqun said his company will push into the North American market, as part of its plan to strengthen the capacity and distribution of its overseas bases. The company is also in the early stage of negotiation with partners to build plants in Mexico and Canada,

CATL is one of Tesla’s main battery cell suppliers, especially in China where the battery packs of the Shanghai-made Model 3 and Model Y EVs mostly feature CATL’s lithium iron phosphate (LFP) cells.

Previously, the Shenzhen-listed CATL renewed a partnership agreement with Tesla to provide battery packs for Model 3 sedans and Model Y sport-utility vehicle made in Shanghai Giga factory until December 2025.

CATL begun supplying lithium batteries to Tesla since February 2020, under the agreement that Tesla said it would purchase battery until June 2022.

Beside Tesla, CATL’s battery packs are used in many electric vehicles such as Chinese EV Nio.

In August, 2020, CATL, Chinese electric car manufacturer Nio, the Hubei Science Technology Investment Group, and a subsidiary of Guotai Junan International Holdings, have agreed to set up a battery asset company that focus on offering battery as a Service (BaaS).