Photo: CATL
CATL announced it will build its second factory in Europe. With the first one being in Germany, the company decided it should have another in Hungary. The first manufacturer to receive them will be Mercedes-Benz, but there will be plenty for everyone: CATL said the plant will have a 100-GWh capacity.
The new battery plant will b built in an area of 221 hectares (546.1 acres) in the Southern Industrial Park of Debrecen, pretty close to plants from BMW, Mercedes-Benz, Stellantis, and Volkswagen. It would not surprise us if the other three also decided to buy cells from the new CATL factory. They may even already have signed contracts for that. Curiously, that means that the first
CATL will invest €7.34 billion ($7,48 billion at the current exchange rate) in the new facility. Part of the investment may be in a solar power plant, which the Chinese battery maker is studying with local companies. Regardless of that moving forward or not, CATL is committed to using energy from renewable sources. We are just not sure if all of the power will come from these sources or just part of it because CATL just said that it “will use electricity from renewable energies,” which can be true if only 1% comes from something other than fossil fuels.
CATL also said it will try to make battery materials in Europe to “build a sustainable and circular battery value chain.” That is probably anticipating what the U.S. is doing with the Inflation Reduction Act. If Europe decides to restrict EV sales to vehicles made in Europe or those with locally-sourced battery materials, anything powered by CATL’s products will already comply with the rules.
As we have discussed, that is probably not going to happen in Europe because it would be an easy target at the World Trade Organization (WTO). After the European Commission said it will protest against the new American law, it would be massively incoherent to do the same. At best, it could turn into a response if WTO does not punish the U.S. for restricting the new federal tax credit to products made in North America.
CATL will invest €7.34 billion ($7,48 billion at the current exchange rate) in the new facility. Part of the investment may be in a solar power plant, which the Chinese battery maker is studying with local companies. Regardless of that moving forward or not, CATL is committed to using energy from renewable sources. We are just not sure if all of the power will come from these sources or just part of it because CATL just said that it “will use electricity from renewable energies,” which can be true if only 1% comes from something other than fossil fuels.
CATL also said it will try to make battery materials in Europe to “build a sustainable and circular battery value chain.” That is probably anticipating what the U.S. is doing with the Inflation Reduction Act. If Europe decides to restrict EV sales to vehicles made in Europe or those with locally-sourced battery materials, anything powered by CATL’s products will already comply with the rules.
As we have discussed, that is probably not going to happen in Europe because it would be an easy target at the World Trade Organization (WTO). After the European Commission said it will protest against the new American law, it would be massively incoherent to do the same. At best, it could turn into a response if WTO does not punish the U.S. for restricting the new federal tax credit to products made in North America.
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