CATL Maintains Top Position in Power and ESS Battery Market Share; Last Year’s Net Profit Up 15% YoY; Lithium Mine in Jiangxi Has Resumed Production

SMM March 18 News: Recently, CATL released its investor relations activity record, mentioning that the company's total revenue in 2024 reached 362 billion yuan, with a net profit attributable to shareholders of publicly listed firms at 50.7 billion yuan, up 15% YoY. The comprehensive gross profit margin was 24.4%, up 5.3 percentage points YoY.

CATL stated that during the reporting period, the company maintained its leading position in both power battery and ESS battery markets. According to SNE data, in the power battery sector, the company ranked first globally in power battery usage for eight consecutive years, with a global market share of 37.9% in 2024. In the ESS sector, the company ranked first globally in ESS battery shipments for four consecutive years, with a global market share of 36.5% in 2024.

Regarding the company's growth expectations for power and ESS batteries in 2025, CATL noted that in the domestic power market, the electrification rate in the Chinese market has exceeded 50% and is expected to rise to 80%-90% by 2030. In the medium and long term, the certainty of electrification rate improvement becomes increasingly evident. The broader application scenarios of intelligent driving also contribute to boosting the electrification market.

In the overseas power market, the European market performed well in January-February 2025, confirming the positive trend in the European market. Although the EU adjusted its short-term phased carbon reduction targets, it did not alter its long-term electrification goals. The policy adjustments mainly aim to provide temporary relief for automakers. With the gradual launch of more competitive car models, the European market is expected to maintain rapid growth.

Overall, the medium and long-term growth trend of the global power market is clear, with significant growth potential.

In the ESS market, as supportive policies for ESS continue to be introduced, such as the full market entry of new energy promoting more market-oriented electricity trading, the market is expected to benefit in the long term. The ESS markets in the US and Europe continue to grow at a healthy pace, and with the demand driven by data centers, the ESS battery market may grow even faster.

Additionally, when asked about potential price increases in midstream materials, CATL stated that currently, the materials sector remains in a state of oversupply. The company continues to innovate to reduce costs and improve efficiency while actively assisting industry chain enterprises in cost reduction. With the release of scale effects, there is still room for cost reduction.

CATL also mentioned that since H2 2024, the company's capacity utilization rate has been robust, with a 20% increase in H2 compared to H1, and an annual capacity utilization rate of 76.3%. Given the rapid market growth in the coming years, the company is increasing its capacity under construction, which exceeds 200 GWh. The application of technologies like super-long production lines has improved investment efficiency, and the growth rate of capital expenditure will be lower than the growth rate of capacity.

When asked about the 2025 ESS market outlook, CATL stated that the US market remains one of the largest ESS markets globally. Driven by factors such as accelerated approvals and increased demand from data centers, the US ESS market is expected to maintain rapid growth. Furthermore, other regions, such as the Middle East and Australia, also show considerable market potential, with fast-growing ESS markets. This year, the company has performed well in securing orders in these markets. The global ESS market demand is expected to grow positively, requiring high-quality products. CATL's ESS products have been highly recognized by owners for their safety and long lifespan. The company does not rely solely on low prices to secure orders and can maintain reasonable profit levels.

CATL's Hungary factory Phase I project is accelerating construction, with the civil works of the plant completed and facility installation underway. The module line is expected to start production this year, and the battery cell line is expected to begin production in H2 2025. Phase II has obtained relevant approvals and is in the preparatory stage, with construction expected to start in 2025.

Regarding the question of whether the relaxation of EU carbon emission policies would slow down NEV growth, CATL stated that the EU carbon emission policies have not changed the relevant targets but have adjusted the annual carbon emission indicators to be assessed based on a three-year average. EU automakers have not altered their overall electrification goals due to the policy relaxation. The policy only temporarily eases requirements for automakers, which is expected to benefit the overall electrification rate in the EU in the long term.

When asked about the resumption of the Jiangxi lithium mine, CATL confirmed that the project has resumed production. The company noted that the Jiangxi lithium mine project had experienced a temporary suspension, during which cost reduction and efficiency improvement measures were actively implemented, yielding initial results. Considering the strategic resource value of the project amid the continued growth in future new energy market demand, the company has resumed production.

Public information shows that CATL's main lithium mine project in Jiangxi is located in the Jianxiawo mining area at the junction of Huaqiao Township, Yifeng County, and Shangfu Town, Fengxin County. The mining area primarily extracts lepidolite, with resource reserves of 960.25 million mt and an average lithium oxide grade of 0.27%, equivalent to approximately 6.57 million mt of LCE.

Notably, benefiting from two high-priced lepidolite auctions last week, which further boosted sentiment to stand firm on quotes from other suppliers, the overall price of lepidolite has slightly increased recently. According to SMM spot quotes, as of March 18, the spot price of lepidolite concentrate (China spot) (Li₂O:1.5%-2.0%) rose to 900-1,610 yuan/mt, with an average price of 1,255 yuan/mt, up 75 yuan/mt from the March 10 low of 1,180 yuan/mt, an increase of 6.36%.

》Click to view SMM new energy product spot quotes

As for lithium carbonate, according to SMM spot quotes, the spot price of lithium carbonate has slightly increased over the past three trading days. As of March 18, the spot price of battery-grade lithium carbonate rose to 74,200-75,900 yuan/mt, with an average price of 75,050 yuan/mt, up 300 yuan/mt from the March 13 low of 74,750 yuan/mt, an increase of 0.4%.

》Click to view SMM new energy product spot quotes

According to a recent SMM survey, based on the current market transaction situation, with the spot-futures price spread gradually strengthening and some downstream material plants expecting production schedule adjustments, downstream purchase willingness remains relatively weak, and market transactions are scarce. Upstream lithium chemical plants still hold some sentiment to stand firm on quotes. Although a few lithium chemical plants have implemented production cuts, the supply of lithium carbonate remains relatively sufficient. From the actual supply and demand perspective of lithium carbonate, the significant surplus situation is difficult to reverse.

Notably, on the evening of March 17, NIO announced that it had signed a strategic cooperation agreement with CATL in Ningde, Fujian. The two parties will build a battery swapping network covering all passenger car models, unify industry technical standards, and deepen capital and business cooperation to provide more efficient energy solutions for users, leading the NEV industry toward a new stage of high-quality development. CATL will support NIO's battery swapping network development, and NIO's Firefly brand's new car models will adopt CATL's chocolate battery swapping standards and network at an appropriate time. The battery swapping network of both parties will adopt a "dual-network parallel" model to provide more convenient and efficient battery swapping experiences for users, further enhancing the convenience of pure electric travel.

Following the announcement, NIO's stock price surged over 16% intraday on March 18 before pulling back to around 8%, still showing strong performance. CATL's stock price also rose nearly 2% intraday but later pulled back to around 0.39%.

The battery sector also showed strong performance today, with the battery index surging over 2% intraday. By the close of the day, the battery index rose 1.05% to 1,071.58. Among individual stocks, Shengyang Co. hit the daily limit, while Zhenhua New Materials, Zhongrui Co., and Hunan Yuneng also followed with gains.