On the evening of December 10th, CATL (300750. SZ) and globally renowned automaker group Stellantis jointly announced that they have reached an important cooperation agreement. According to the terms of the agreement, CATL and Stellantis Group will jointly establish a joint venture company in Spain, with each party holding 50% of the equity in the joint venture company. The core of this cooperation is to jointly build a lithium iron phosphate battery manufacturing plant under the name of the joint venture company in Zaragoza, Aragon Autonomous Region, Spain. It is worth noting that CATL will hold a controlling position in this joint venture.
Continuously promote the development of electrification
In fact, the cooperation history between CATL and Stellantis Group can be traced back to an earlier period. In November 2023, the two companies signed a non binding memorandum of understanding. According to the memorandum, CATL has committed to providing localized lithium iron phosphate battery cells and modules for Stellantis Group's electric vehicle production in Europe. This measure aims to strengthen Stellantis Group's electrification strategy in the European market and enhance CATL's influence in the global new energy vehicle supply chain.
Now, with the signing of a joint venture agreement between CATL and Stellantis Group, their cooperation will enter a new stage. The announcement shows that the investment scale of the battery factory jointly built by the two parties is huge, and the total investment is expected to reach 4.038 billion euros (about 30.9 billion yuan). The reporter from Huaxia Times learned from Stellantis Group that the factory plans to start production by the end of 2026, with an annual production capacity of 50GWh, which is sufficient to meet Stellantis Group's demand for high-quality power batteries. This measure will not only further consolidate the cooperation foundation between CATL and Stellantis in the field of electric vehicles, but also effectively promote the competitiveness and market share of both parties in the global electric vehicle market.
Regarding the construction of a power battery factory in Europe, CATL stated that the project aims to deepen the long-term strategic cooperation between the company and Stellantis Group in the field of new energy vehicles. By fully leveraging and utilizing the leading advantages and resources of both parties in their respective fields, it will promote global electrification and clean energy transformation. This cooperation is in line with the company's global strategy and will help further improve the company's international layout, thereby enhancing its sustained profitability and core market competitiveness.
Stellantis Group points out that this joint venture will enhance the group's leading advantage in lithium iron phosphate batteries in Europe, helping it provide higher quality, more durable, and more affordable electric sedans, crossover vehicles, and SUVs in the mid range B-class and C-class car segments. Depending on customary regulatory conditions and approvals, it is expected that this transaction will be completed and delivered within 2025.
Automotive analyst Lin Shu told reporters from Huaxia Times, "This cooperation not only marks an important milestone for CATL in the European market, but also reflects Stellantis Group's determination to accelerate its electrification transformation. By jointly investing in and building a factory, both parties aim to build a tighter and more efficient supply chain system to jointly respond to the rapidly growing demand for new energy vehicle power batteries worldwide. This measure will not only help enhance the competitiveness of both parties in the global new energy vehicle market, but also contribute to promoting the global automotive industry's transformation towards a greener and more sustainable future
It is worth mentioning that CATL's battery production layout in Europe is steadily expanding at an unprecedented speed, with the Spanish factory becoming its third important battery production base in Europe.
As early as 2018, CATL announced plans to establish its first European factory in Arnstadt, Thuringia, Germany, and officially started construction in 2019. The investment amount of this factory is about 1.8 billion euros (approximately 13.2 billion yuan), and the initial planned production capacity is set at 14GWh.
Subsequently, in August 2022, CATL once again focused on the European market and announced the construction of a larger battery factory in Debrecen, Hungary, with an investment ceiling set at 7.34 billion euros and an expected production capacity of up to 100 GWh. This measure not only further consolidates CATL's leading position in the global battery market, but also provides strong support for its deep expansion in the European market.
At this year's investor event, CATL revealed the latest developments at its German and Hungarian factories. In terms of German factories, production capacity is steadily increasing, and the company is confident in achieving the goal of breakeven within the year. The first phase of the Hungarian factory project is also steadily progressing according to plan. The civil engineering work of the factory has been successfully completed, and the installation of facilities is being carried out intensively. It is expected to be officially put into operation next year.
Large scale dividends
Behind the accelerated overseas factory construction strategy of CATL, there is a significant increase in the global market share of Chinese battery companies. According to the latest data released by the authoritative research institution SNE Research in South Korea, from January to October this year, among the top ten companies in terms of global power battery installation volume, six Chinese battery companies achieved significant growth. In contrast, Japanese and Korean battery giants such as LG New Energy (LGES), SK On, Panasonic, and Samsung SDI experienced a decline in market share.
In this list, CATL continues to hold the top spot in the global power battery market with a year-on-year growth rate of 28.3% (with a total installed capacity of 252.8 GWh). The achievement of this result is not only due to CATL's continuous efforts in technological innovation, product quality, and supply chain management, but also closely related to its active expansion of the global cooperation network.
In terms of cooperative car companies, CATL has established deep cooperative relationships with multiple internationally renowned car companies. According to the semi annual report of CATL this year, the company has deepened global cooperation with overseas car companies such as BMW, Daimler, Stellantis, Volkswagen, Ford, Hyundai, Honda, and Volvo in the field of power batteries, jointly promoting the development of the electric vehicle industry. At the same time, CATL continues to strengthen its cooperation with domestic car companies such as SAIC, Geely, NIO, Ideal, Yutong, Xiaomi, and BAIC, helping Chinese car brands rise in the global market.
Supported by business, CATL's revenue for the first three quarters was 259.045 billion yuan, a year-on-year decrease of 12.09%. However, the net profit attributable to shareholders of the listed company achieved a year-on-year increase of 15.59%, reaching 36.001 billion yuan. This indicates that despite the challenges posed by the complex and ever-changing global economic situation and intensified industry competition, CATL is still able to maintain stable profitability and create more value for shareholders.
In order to further reward its shareholders, CATL has announced a special dividend plan. Specifically, the company plans to use 15% of the net profit attributable to shareholders of the listed company in the consolidated financial statements for the first three quarters of 2024, which is 5.4 billion yuan, as the total amount for this dividend. According to this plan, the company will distribute a cash dividend of 12.30 yuan (including tax) to all shareholders for every 10 shares, without giving bonus shares or converting public reserves into share capital.
CATL emphasizes that this special dividend is an important component of the company's 2024 annual dividend plan. As for the remaining parts of the 2024 annual dividend plan, the company will submit it to the annual shareholders' meeting for review and decision after being approved by the board of directors in the next year.
In addition, CATL stated that the company's decision to distribute dividends this time was made after considering various factors such as business development, financial condition, and capital planning. By increasing the frequency of dividends, the company hopes to effectively enhance investors' sense of gain and share the business results brought by the company's growth with all shareholders. Meanwhile, CATL has also made it clear that implementing this dividend plan will not cause any shortage or other adverse effects on the company's working capital.
The special dividend plan announced by CATL can be seen as an important measure to give back to its shareholders. In Lin Shucheng's view, by increasing the frequency and intensity of dividends, CATL can effectively enhance investors' sense of gain and strengthen their confidence in the company. Meanwhile, this will also help attract more investors to pay attention to CATL and drive its stock price steadily up.