Published: Thu, July 12, 2018
Business | By Tara Barton

Electric-Vehicle Battery Leader to Open German Plant

Electric-Vehicle Battery Leader to Open German Plant

CATL acknowledged the receipt of a letter of intent from the German auto giant to source new energy vehicle batteries from the Fujian-based firm, it said in a statement today.

BMW has a long-term contract to source 4 billion euros ($4.7 billion) of battery cells from CATL, the German carmaker's purchasing head, Markus Duesmann, added on July 9.

Around 240 million euros ($280 million) will be invested in the first phase of the project, Wolfgang Tiefensee, Thuringia's minister of economic affairs, told journalists.

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The company plans to make the investment in two stages, with an initial 14 gigawatt-hours of capacity to come on stream in 2021. "If the Thuringia project is successful then we can consider other locations", Zeng said.

"Today's signing represents a new level of cooperation between China and Germany", BMW CEO Harald Krueger said in the statement.

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The company sold 560,000 BMW brand vehicles to customers in China in 2017, more than the USA and Germany combined.

However, Ferdinand Dudenhöffer, professor of automotive economics at the Center for Automotive Research in Duisburg, said that the CATL battery-cell plant is a good thing for Germany and would help keep German carmakers competitive.

At a press conference in Berlin, CATL chairman Robin Zeng said that his company wants to become a supplier for all the original equipment manufacturers in Europe.

Ambitious plans for electric vehicle battery production have driven sharp price rises in recent years for lithium and cobalt, which is used to stabilize and extend the life of lithium-ion rechargeable batteries, and has raised fears over the security of supply of those metals.

Duesmann said BMW would only conclude contracts where inhuman conditions and child labour were ruled out.

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