Chinese battery giant CATL spreads investments in search of new growth drivers

World’s largest producer of lithium-ion batteries for EVs and energy storage systems has committed over 17 billion yuan to non-battery deals

Since June last year, at least seven CATL-led equity deals involving a total of over 17 billion yuan (US$2.5 billion) have been announced in non-battery industries. The sectors involved span humanoid robots, state-owned hydropower stations, artificial intelligence data centres (AIDCs) and large-language-model developer DeepSeek.

The equity investments by Fujian-based CATL seemed primarily strategic, similar to its earlier playbook of forming joint ventures with carmakers and investing in EV start-ups, said Yang Jing, director of Asia-Pacific corporate ratings at Fitch Ratings.

“As the incumbent leader, sustaining market share and margins requires identifying new high-growth frontiers early and capturing first-mover advantages,” she said. “AIDC’s high-growth, high-barrier characteristics position it as a potential ‘third growth curve’ alongside EVs and energy storage systems.”

CATL is the world’s largest producer of lithium-ion batteries for EVs and energy storage systems. But it is facing weakening demand for electric cars in China – the world’s largest automotive market – and intensifying competition with mainland rivals for energy storage orders in overseas markets.

In May, Nasdaq-listed VNET Group, a Chinese third-party provider of neutral AIDCs, said two CATL-affiliates would acquire up to 38.1 per cent of its shares for US$942 million, becoming its largest shareholder. This month, Shenzhen-listed Hangzhou Zhonhen Electric, which supplies power supply systems for AIDCs and vehicle charging, that it planned to sell a 49 per cent stake in the business to CATL for 4.09 billion yuan.