BUSINESS

CATL Ramps Up Battery Production With Yunnan Deal

Published: Feb. 4, 2026 5:58 p.m. GMT+8

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CATL signed a strategic cooperation agreement with the Yunnan provincial government in Kunming. Photo: CATL

Contemporary Amperex Technology Co. Ltd. (CATL) has signed a strategic cooperation agreement with the Yunnan provincial government to build a new plant, marking the battery giant’s third capacity expansion deal in a month as it tries to consolidate its dominant market position.

Under the agreement announced Tuesday, CATL will construct a lithium battery manufacturing facility in the Dianzhong New Area in Yunnan, which will be up and running by the end of this year. The parties did not disclose the investment amount and planned capacity.

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CATL signed a new agreement to build a lithium battery plant in Yunnan, marking its third expansion in a month, following similar deals in Fujian and Guizhou.
In 2025, CATL led with 39.2% of EV battery sales and a 30% share in energy storage, maintaining high capacity utilization rates.
Lithium carbonate prices doubled in late 2025, prompting regulatory actions, including a phased removal of export tax rebates for battery firms by 2027.

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Who’s Who

Contemporary Amperex Technology Co. Ltd.: Contemporary Amperex Technology Co. Ltd. (CATL) is a leading global battery giant, dominant in EV and energy storage battery sales. They are rapidly expanding their manufacturing capacity, with recent deals in Yunnan, Quanzhou, and Guizhou, aiming to maintain their market position. This expansion comes amidst high capacity utilization rates and increasing demand for batteries.

Jiangsu Lopal Tech Co. Ltd.: Jiangsu Lopal Tech Co., Ltd. is an upstream supplier in the battery industry. On January 4th, the company announced a significant investment of up to 2 billion yuan ($288 million) to establish new production lines for LFP battery materials. This expansion reflects the broader trend of increased production capacity among suppliers to meet rising demand in the battery sector.

Fulin Precision Co. Ltd.: Fulin Precision Co. Ltd. (富临精工股份有限公司) recently raised 2.56 billion yuan by selling shares to CATL. This capital will be used to increase the production of LFP battery materials, supporting the growing demand in the battery sector.

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