VW China, a subsidiary of the German automaker Volkswagen has revealed a plan to intensify cooperation with CATL (Contemporary Amperex Technology Co Ltd), the world’s largest manufacturer of EV batteries. According to Reuters, CATL said that the intention is to deepen partnership in battery R&D, new materials application and components development.
Separately, Volkswagen said in its statement that Volkswagen China, SAIC Volkswagen, FAW Volkswagen and Volkswagen Anhui signed a MoU with CATL to establish a strategic partnership.
More specifically the cooperation concerns lithium batteries for Volkswagen’s electrified cars in China. The aim is to create bespoke batteries with higher performance and more efficient cost structures for specific models in the Chinese market, a Volkswagen spokesperson said.
The partnership will later extend to other areas for electrified vehicles like battery recycling and vehicle-to-grid technology, where electricity from the car is transferred back into the electricity grid, CATL said.
According to Technode and the financial media outlet Caixin the two companies will jointly develop EVs with swappable batteries. CATL said last December that it had co-developed 10 new EV models with automakers and would build 1,000 battery swapping stations in China in 2025.
VW and other similar players have lost market share despite a rapid electrification process in China. These manufacturers have aimed to replace falling ICE sales with EV sales but have struggled in a competitive Chinese EV market. Volkswagen EV sales fell by 2% in 2024 compared to 2023. The automaker delivered 2.928 million vehicles in China in 2024, down 10% year-on-year for all ranges.
According to Rho Motion’s EV and battery database, in 2024, CATL supplied batteries were in 24% of VW’s EVs sold, this included 100% of its Chinese EV sales for which CATL has been the main supplier since 2022.
