Battery Giant CATL Sees Revenue Dip for First Time
Market Shifts and Price Adjustments Take Toll on Profit
The world’s largest battery maker, CATL, has issued a warning that its annual revenue has fallen for the first time since 2015. This news sent shares plummeting by nearly 4% on Wednesday. According to a securities filing, the company’s revenue dropped between 8.7% and 11.2% last year due to adjustments in product prices, reflecting the decline in raw material costs such as lithium carbonate.
Slowing Profit Growth
Despite sales volumes increasing, CATL’s operating income declined, leading to a slowdown in profit growth. Net profit rose between 11.1% and 20.1% in 2024, marking the company’s slowest profit growth since 2019. This news comes ahead of CATL’s full-year results, scheduled to be released on March 15.
Lithium Market Intervention
In 2022, CATL intervened in the lithium market by opening a massive lithium hub in Jiangxi province, China, when prices were soaring. However, lithium prices have since plummeted by nearly 86% over the past two years. As a result, CATL’s founder, Robin Zeng, announced that they would stop production at the mine, having achieved their goal.
Diversification Efforts
CATL is expanding its reach beyond batteries, having launched a new EV chassis in December and strategizing a pivot to power grids. The company is also investing abroad, including a 100 GWh battery factory in Hungary to supply major automakers like Mercedes-Benz and BMW, as well as a jointly owned battery plant with Stellantis in Spain.
European Expansion
At the annual World Economic Forum in Davos, CATL’s co-chairman, Pan Jian, announced plans to unveil major joint venture efforts in Europe with other automakers. Additionally, Reuters reported that CATL has hired banks to work on a Hong Kong float, which could be one of the city’s largest offerings in 2025.
Market Share and Competition
CATL maintained a 45.1% market share in Chinese-made EV batteries last year, up 1.9 percentage points from the previous month. Meanwhile, the combined market share of second-ranked BYD and third-placed CALB slid by 4.3 percentage points to 31.4%, according to data from the China Automotive Battery Innovation Alliance.
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