CATL’s Third European Battery Plant Lands in Spain
On December 10th, CATL (Contemporary Amperex Technology Co. Limited) and Stellantis, the world’s fourth-largest automotive group, inked a deal, each holding a 50% stake to form a joint venture. This partnership involves a hefty investment of 4.1 billion euros to construct a cutting-edge lithium iron phosphate battery production plant in Zaragoza, Spain. Production is slated to kick off in 2026, with a target capacity of 50GWh.
This move signifies CATL’s third significant battery factory in Europe and its inaugural facility solely dedicated to manufacturing lithium iron phosphate batteries. In the realm of automotive batteries, lithium-ion and lithium iron phosphate technologies reign supreme, with the latter gaining ground in recent times.
CATL’s lithium iron phosphate batteries made a splash in the Chinese market from January to October 2024, boasting an installation volume of 107.5GWh, capturing a commanding market share of 36.5% and clinching the top spot.
John Elkann, Stellantis’ Chairman, present at the signing ceremony, highlighted that Zaragoza already serves as the group’s hub for new energy vehicle manufacturing. The collaboration with CATL promises innovative battery manufacturing capabilities, holding strategic significance for the group.
At the ceremony, CATL’s Chairman Zeng Yuqun expressed, “By leveraging CATL’s advanced battery technology and operational expertise, alongside Stellantis’ extensive local business experience in Zaragoza, this project is poised to be a standout success in the industry.” In a departure from traditional Chinese investments in European battery plants, this venture adopts a 50-50 joint venture model.
While this approach is novel for CATL and Stellantis in Europe, it mirrors CATL’s established practices in China, where joint ventures with Chinese automotive companies are commonplace, typically with CATL holding a 51% stake. In contrast to China, where CATL’s joint ventures are integral parts of its manufacturing bases, European expansion necessitates building new factories within established automotive manufacturing complexes.
The choice of Spain as the factory location is strategic, capitalizing on the country’s advantages in producing lithium iron phosphate batteries. Spain’s proximity to Morocco, with its vast phosphate reserves, is crucial. Morocco, home to 71% of global phosphate reserves, has attracted investments from key players like CATL, BTR, and Microvast, spanning the entire lithium battery industry chain.
Spain’s abundant wind and solar resources further enhance its appeal. With renewable energy accounting for over half of Spain’s electricity generation in recent years, the country offers an ideal setting for low-carbon manufacturing processes, aligning with the industry’s sustainability goals.
CATL’s entry into Spain promises a significant boost to the local supply of lithium iron phosphate batteries in Europe. With CATL, Microvast, and Guoxuan High-Tech all set to commence production in 2026, boasting a combined capacity of 100GWh, European consumers can look forward to enhanced access to these advanced battery technologies, fostering greater confidence in their adoption.
