CATL has begun construction of a large industrial park in the Chinese city of Yichang for the production of battery materials for electric vehicles and the recycling of batteries. The first phase is scheduled to be commissioned in 2023 and the entire project completed in 2025.
According to media reports, CATL has now officially made these plans public on its WeChat account. The news website Auto Gasgoo, reports that an agreement was already reached with the local authorities in mid-October. In an earlier statement, CATL also mentioned Brunp Recycling and Ningbo Brunp CATL as project partners. CATL is said to have a majority stake in Brunp, while Ningbo Brunp CATL is a joint venture between the two companies.
Yichang is located in the west of the Chinese province of Hubei. The production facility will cover the entire production of cathode material, including the processing of raw materials and pre-products. The plan is to have an annual production capacity of 360,000 tonnes of iron phosphate, 220,000 tonnes of lithium iron phosphate, 180,000 tonnes of NCM precursor material, 40,000 tonnes of lithium cobalt oxide and 40,000 tonnes of recycled graphite. The industrial park’s facilities are expected to be able to provide battery cathode materials for 4 million electric vehicles when completed.
A separate complex of the planned industrial park in Yichang will also be dedicated to recycling. The recycling capacity is expected to reach up to 300,000 tonnes of batteries per year. Reuters reported in October that CATL was aiming to build a recycling factory for battery materials in Hubei province – under the direction of a joint venture yet to be founded with the company Hubei Yihua Chemical Industry. It remains unclear whether this will be an identical plant or a second one.
Involvement in the recycling sector is relatively new for CATL. According to the news agency, among other things, new standards and guidelines formulated by the Chinese government to promote battery recycling and to save materials probably played a role in CATL’s investment decision.
CATL is one of the world’s leading manufacturers of battery cells for electric cars. The group’s success is mainly due to its strong position in the domestic market. According to information from the beginning of the year, CATL wants to defend this position by massively expanding its production capacities – specifically, it is talking about an increase in output to 230 GWh of battery cells this year and to 1,200 GWh in 2025, with the following intermediate steps: 380 GWh (2022), 540 GWh (2023) and 830 GWh (2024).
The expansion of production capacity is to be accompanied by expansion to Japan, Indonesia, the USA and Europe, with Germany playing a key role in the European market. This key role stems from CATL’s first production facility outside China, which started in Erfurt. The groundbreaking ceremony took place there in October 2019, a personnel offensive is currently underway, and completion is planned for 2022. The battery cells produced there will be supplied to BMW and Volkswagen, among others.
CATL recently acquired the Canadian mining company Millennial Lithium to secure raw materials for production. The takeover of the lithium producer is just the latest example of a series of investments that CATL has made in recent times to expand its supply chain vertically. The battery maker recently bought stakes in Neo Lithium Corp, also a Canadian company, Greenland’s North American Nickel and Australia’s Pilbara Minerals, among others. Since April, a CATL subsidiary has also held a stake in China Molybdenum’s Kisanfu mine, a cobalt site in the Democratic Republic of Congo.
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