The U.S. Department of Defense has blocked CATL, China’s largest battery manufacturer, citing its ties to the Chinese military. This move has raised concerns over CATL’s significant influence in the global electric vehicle (EV) market.
Bloomberg reported on Tuesday that CATL wields significant power in the global electric vehicle industry. The company’s batteries power one in three electric vehicles worldwide, with major automakers like Tesla, Ford, Volkswagen, Stellantis, and Honda among its clientele.
CATL is projected to capture about 37% of the market share in 2024, far outpacing its Chinese rival, BYD, at 17%. These two firms control over half of the global electric vehicle battery market.
Following the blocklisting, CATL’s stock price dropped by 6.1%. The company and other listed entities such as Huawei, SMIC, and Tencent have challenged the U.S. decision.
In response, CATL issued a statement condemning the U.S. Defense Department’s action as “a mistake,” asserting that the company has “never engaged in any military-related business or activities.” This strong rebuttal suggests that CATL may pursue legal action.
The company had also planned a second initial public offering (IPO) in Hong Kong to raise at least five billion dollars by late 2025. Experts believe that the blocklist status could complicate these plans.
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