CATL Lithium Strategy 2025: Securing the Global Battery Supply Chain

CATL’s Commercial Scale Lithium Projects and Industry Integration

CATL has transitioned from a downstream battery manufacturer dependent on external suppliers to a vertically integrated powerhouse that controls upstream lithium resources to support its massive global expansion.

• Between 2021 and 2024, CATL initiated its upstream strategy by acquiring foundational stakes in lithium mining assets across the globe, including projects in Bolivia, Argentina, and the Democratic Republic of Congo. This period shifted in 2025, which revealed the strategic power of these investments when the temporary shutdown of its Jianxiawo mine in China, a single asset representing 3% of global lithium output, caused significant price surges in the global market.
• The company’s strategy matured from simple resource acquisition to creating guaranteed demand through deep integration with automakers. While earlier years saw the start of these partnerships, 2025 marked the groundbreaking of major joint ventures, such as the €4.1 billion LFP gigafactory with Stellantis in Spain, which secures offtake for its captured lithium supply.
• CATL expanded its addressable market beyond electric vehicles by securing a dominant position in the energy storage systems (ESS) sector. This was solidified by the August 2025 launch of the 9 MWh TENER Stack and a massive 200 GWh supply agreement with HyperStrong, creating a substantial new demand channel for its batteries.
• As a strategic hedge against lithium price volatility, CATL is commercializing non-lithium chemistries. The September 2025 announcement that its Naxtra sodium-ion battery is ready for mass production in 2026 with a 500 km range represents a critical move to de-risk its supply chain with a viable, high-performance alternative.

CATL Investment Analysis: Billions Deployed for Global Battery Dominance

CATL has deployed tens of billions of dollars across the entire battery value chain, from securing mining rights and building processing facilities to financing massive gigafactory expansions in key automotive markets. These investments demonstrate a clear strategy to control both the supply of raw materials and the manufacturing capacity needed to meet escalating global demand. In 2025 alone, the company executed several multi-billion-dollar financing and project investment initiatives to fund its expansion in Europe and Asia. This follows a period from 2021 to 2024 where foundational investments were made in upstream lithium projects in South America and Africa. The table below details these strategic capital allocations, which collectively fortify CATL‘s leadership position.

Table: CATL’s Strategic Investments in Lithium and Battery Production (2021-2025)

CATL’s Strategic Partnership Network for Supply Chain Control

CATL has systematically constructed a global network of partnerships to secure raw material inputs, co-develop technology, guarantee market access, and pioneer new business models. These collaborations span from upstream mining giants like BHP to downstream automakers like Stellantis and Volkswagen, as well as innovators in new sectors like energy storage and battery swapping. This web of alliances is fundamental to its strategy of embedding itself across the entire energy value chain.

Table: CATL’s Key Strategic Partnerships and Collaborations (2021-2025)

CATL’s Global Footprint: From Chinese Dominance to European and South American Expansion

CATL has expanded its operational and resource-focused geography from a primarily China-centric base to a global trifecta, securing raw materials in South America and Africa while building massive production capacity in Europe.

• The 2021–2024 period was defined by an upstream resource push into new geographies, with CATL securing foundational lithium assets in South America’s “Lithium Triangle” through its $298 million acquisition in Argentina and its $1.4 billion deal in Bolivia, as well as cobalt in Africa via its partnership in the DR Congo.
• In 2025, the strategic focus shifted to building out a major manufacturing footprint in Europe to serve local automakers and mitigate geopolitical risk. This is demonstrated by the advancement of the €7 billion gigafactory in Debrecen, Hungary, and the launch of a €4.1 billion joint venture with Stellantis for a battery plant in Zaragoza, Spain.
• Southeast Asia has emerged as a critical hub for CATL‘s vertical integration strategy, anchored by the $6 billion battery integration project in Indonesia that covers the entire value chain from nickel mining to battery recycling, leveraging the region’s rich mineral resources.
• Despite its global expansion, China remains the core of CATL‘s power, functioning as both a major resource base and its largest market. The operational saga of the Jianxiawo lithium mine in Yichun in 2025, where a temporary shutdown impacted global prices, underscores the strategic importance of its domestic assets.

CATL Technology Status: Commercial Scale LFP and Emerging Sodium-Ion Alternatives

CATL operates at full commercial scale with its lithium-ion technologies, particularly lithium iron phosphate (LFP), while strategically advancing sodium-ion batteries toward mass production as a commercially viable alternative.

• During the 2021-2024 period, CATL focused on scaling its proven LFP and NMC technologies globally, which was validated by its selection for massive projects like the 1,416 MWh Gemini storage facility in the US and the decision by Ford to license its LFP technology for a $3.5 billion plant.
• The year 2025 marks a dual-track advancement where CATL is simultaneously pushing the performance limits of its commercialized technology while preparing the next generation for market entry. The launch of the Shenxing Pro LFP battery with a 758 km range demonstrates continued innovation in its core product line.
• CATL has moved its sodium-ion battery technology from the lab to a near-term commercial product. The September 2025 announcement that its Naxtra battery has passed certifications and is ready for mass production in 2026 signals its maturity as a strategic hedge against lithium dependency.
• Further-horizon technologies are also progressing, as shown by the June 2025 announcement of a breakthrough in lithium metal batteries, achieving an energy density of 500 Wh/kg. This technology remains in the advanced R&D phase, unlike sodium-ion which is on a clear path to commercialization.

SWOT Analysis: CATL’s Lithium and Battery Market Position

Table: SWOT Analysis of CATL’s Strategic Position

Forward Outlook: CATL’s 2026 Strategy Hinges on Execution and Diversification

CATL‘s future success depends on its ability to execute its massive capital projects while successfully commercializing its sodium-ion technology as a strategic counterweight to lithium dependency.

• The successful restart and stabilization of the Jianxiawo lithium mine, expected in Q1 2026, will be the most immediate indicator of CATL‘s ability to manage its upstream operational and regulatory risks and regain control over a key component of its cost structure.
• The scheduled mass production of Naxtra sodium-ion batteries in 2026 is a pivotal milestone. The scale of adoption by automakers and its cost-competitiveness against LFP batteries will validate CATL‘s long-term diversification strategy.
• The commissioning of the Debrecen, Hungary, and Zaragoza, Spain, gigafactories on schedule is critical. Meeting projected capacity targets, such as the 50 GWh goal for the Stellantis JV plant, will test CATL‘s ability to execute complex international projects and manage a global supply chain.
• Achieving its reportedly revised 2026 production guidance of 1,300 GWh, a 30% increase, will require an unprecedented scale-up of its entire integrated value chain, placing immense pressure on its newly acquired mining assets and processing facilities.

Frequently Asked Questions

Why has CATL started investing in lithium mines instead of just manufacturing batteries?
CATL has invested in upstream lithium mines to gain control over its raw material supply, reduce dependency on external suppliers, and hedge against price volatility. This vertical integration strategy ensures a stable supply for its massive global battery production and gives it more influence over the market, as demonstrated when a temporary shutdown of its Jianxiawo mine caused global price surges.

What is CATL’s strategy for expanding outside of China?
CATL’s global strategy involves securing raw materials directly from resource-rich regions like South America and Indonesia, while simultaneously building large-scale gigafactories in key customer markets. For example, it is developing lithium projects in Bolivia and Argentina and building major battery plants in Hungary (€7 billion) and Spain (€4.1 billion JV with Stellantis) to directly serve European automakers.

Is CATL only developing lithium-ion batteries?
No, CATL is actively commercializing non-lithium chemistries as a strategic alternative. The company announced its ‘Naxtra’ sodium-ion battery is ready for mass production in 2026, offering a 500 km range. This move is designed to de-risk its supply chain from a dependency on lithium and provide a viable, high-performance alternative for the market.

What are some of CATL’s most significant partnerships mentioned in the report?
CATL has formed key partnerships across the value chain. Notable collaborations include a €4.1 billion joint venture with automaker Stellantis to build a gigafactory in Spain, a 200 GWh supply agreement with energy storage firm HyperStrong, a partnership with the Indonesian Battery Corporation (IBC) for a $6 billion mine-to-recycling project, and a technology licensing agreement with Ford for its $3.5 billion battery plant in Michigan.

How did CATL’s market position change between 2021 and 2025 according to the SWOT analysis?
According to the analysis, CATL’s position evolved from being a market leader to a market controller. While it already had a dominant market share, by 2025 it demonstrated the ability to directly influence global lithium prices through its own mining operations (like the Jianxiawo mine). Its vertical integration strategy was validated as a powerful tool for not just securing supply, but also shaping the commodity market.