Stellantis and China’s CATL in talks over European battery plant

2 min

101 shares, 162 points

Unlock the Editor’s Digest for free

Stellantis is exploring a partnership with China’s CATL to build low-cost electric car batteries in Europe, in a move that would increase the affordability of its electric vehicles but deepen its reliance on Chinese battery technology. 

The two businesses have struck a supply agreement for batteries, and are in talks that may lead to a 50-50 manufacturing joint venture in the region, they said on Tuesday. 

The deal comes despite repeated warnings from Stellantis chief executive Carlos Tavares about the risk to Western carmakers from Chinese brands and technology and reflects the pressure the carmaker faces to lower the cost of its electric cars.

Tavares led calls to the region’s parliament to impose tariffs on imported Chinese EVs in Europe to protect local carmakers. But the agreement on Tuesday showed that even Stellantis, which also buys batteries from China’s BYD, had chosen to deepen its reliance on Chinese technology. 

While tensions have heightened over Chinese EV sales in Europe, the largest number of battery factories being built in the region are owned by Chinese companies, including CATL, SVolt, and Envision. 

Stellantis chief executive Carlos Tavares
Stellantis chief Carlos Tavares says the partnership with CATL ‘is another ingredient in our long-term strategy to protect freedom of mobility for the European middle class’ © Jeenah Moon/Bloomberg

Stellantis, whose brands include Fiat and Vauxhall, believes lower costs are essential if it is going to switch to selling only EV models in the region by the end of this decade. Tavares has repeatedly cautioned about the impact of electrification on rising prices, warning this risks pricing middle-class buyers out of owning a private vehicle. 

On Tuesday he said the CATL partnership “is another ingredient in our long-term strategy to protect freedom of mobility for the European middle class”.

Tavares added: “CATL is the industry leader in this sector and together with our iconic vehicle brands, we will bring innovative and accessible battery technology to our customers.”

The Stellantis-CATL joint venture, if formed, would manufacture lithium iron phosphate batteries, a cheaper technology than the nickel manganese cobalt batteries that Stellantis currently uses in the region. 

The technology would be used in Stellantis’ smaller models, the company added.

The carmaker already plans to source NMC batteries in the region from ACC, a joint venture with Mercedes-Benz and energy group Total. A CATL plant in Europe would be Stellantis’ fourth, after three planned ACC factories. 

Tesla has led the industry in switching to LFP batteries, which are less power dense but substantially cheaper. 

CATL has become a world leader in LFP batteries, which it supplies to carmakers including Tesla and Ford. 

“With Stellantis’ time-honoured expertise in car manufacturing and CATL’s advanced battery technology, we believe the partnership will be a decisive step on both parties’ journey towards carbon neutrality goals,” said CATL chair Robin Zeng. 

Source: Financial Times

Like it? Share with your friends!

101 shares, 162 points

What's Your Reaction?

Cute Cute
Fun Fun
Hate Hate
Confused Confused
Fail Fail
Geeky Geeky
Love Love
Choose A Format
Personality quiz
Series of questions that intends to reveal something about the personality
Trivia quiz
Series of questions with right and wrong answers that intends to check knowledge
Voting to make decisions or determine opinions
Formatted Text with Embeds and Visuals
The Classic Internet Listicles
The Classic Internet Countdowns
Open List
Submit your own item and vote up for the best submission
Ranked List
Upvote or downvote to decide the best list item
Upload your own images to make custom memes
Youtube, Vimeo or Vine Embeds
Soundcloud or Mixcloud Embeds
Photo or GIF
GIF format