Stellantis and CATL Partner to Construct a €4.1 Billion Battery Plant in Spain

CATL

Stellantis, a prominent Franco-Italian-American automotive manufacturer, together with Chinese battery industry leader Contemporary Amperex Technology Co. Ltd (CATL), has announced an ambitious joint venture. The partnership plans to invest €4.1 billion ($4.3 billion) to establish a lithium iron phosphate (LFP) battery production facility in Zaragoza, Spain. Scheduled to commence operations by the end of 2026, the plant is projected to achieve an impressive output capacity of up to 50GWh annually. This capacity could supply electric vehicle (EV) batteries to approximately 1 million vehicles per year, based on an average battery pack size of 50kWh.

Strategic Expansion and Future Goals

This new venture builds on a prior preliminary agreement between Stellantis and CATL, further solidifying their collaboration. Strategically positioned adjacent to Stellantis’ existing automotive plant in Zaragoza—which has historically manufactured over 14 million Opel and Citroen vehicles since 1982—the battery facility represents a significant step toward supporting Stellantis' electric mobility ambitions. CATL, already operating two battery plants in Germany and Hungary and constructing another in Hungary, contributes extensive expertise and capacity to the partnership.

Market Dynamics and Company Prospects

Despite recent challenges, including declining sales in the European Union and the U.S. and intense competition from Chinese EV manufacturers that led to the resignation of CEO Carlos Tavares, Stellantis remains committed to its electrification strategy. The company has set ambitious targets, aiming for 100% EV sales in Europe and 50% in the U.S. by 2030. This is part of Stellantis' broader strategy to adapt to shifting market demands and increase its stake in the global EV market, which includes recent joint ventures with other major players like Samsung SDI, TotalEnergies, Mercedes-Benz, and Leapmotor.