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Dongfeng becomes a shareholder of CATL

Catherine From Gasgoo| October 26 , 2017 11:10 BJT

Dongfeng becomes a shareholder of CATL

Shanghai (Gasgoo)- Recently, Weidong Liu, vice general manager of Dongfeng Automobile, publicly said that the automaker had become a shareholder of Contemporary Amperex Technology Limited (CATL), a Chinese battery cell and battery management system supplier. According to Liu, his company is also in talk with another new battery company on cooperation. “We should develop business on vehicle-related parts by ourselves.”

As to the vice general manager’s words, CATL insiders said that the battery maker’s core field lies in the development of power battery. They have launched a model together, but at present there are no more details to be made public on the two companies’ further cooperation.  

At the end of last year, the two companies signed strategic framework agreement. In accordance with the agreement, the companies will co-create a platform in new energy vehicle industry, to support each other, reinforce complementary advantages and realize mutual benefits.

To Dongfeng, an automaker with so many joint ventures, it is costly for itself to develop power battery technology and another joint venture will also pose much risk. With the technology obtained from being PSA’s shareholder, it is a better choice to buy shares of a battery giant.

What’s more, Liu also revealed that his company will invest RMB 10 billion on battery, electric motor and electronic control this year. As one of the first companies which developed new energy vehicle at an early stage, Dongfeng boasts a relatively complete research and development system and has a cumulative record of 370 patents. In the first eight months of this year, Dongfeng delivered 28,200 new energy vehicles, soaring 127.25 percent which is much higher than the national average growth rate. It is expected that its new energy vehicle sales will be over 40,000 units.

Even though established only six years ago, CATL has become a leading company in China battery industry. According to Ningde government website, CATL’s market shares in consumer battery market surpassed Samsung and LG while market shares in power battery market are more than those of BYD. Apart from Dongfeng, many companies such as SAIC and BMW have expressed their attention and showed interest in cooperating with CATL.

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