German auto brand Mercedes-Benz expands battery supply partnership with CATL

Mercedes-Benz, German luxury & commercial vehicle automotive brand headquartered in the Stuttgart area of Baden-Württemberg, has announced expansion of its battery supply partnership with Contemporary Amperex Technology Company Limited (CATL).

The world-renowned German automotive brand and the Chinese battery giant have been working together since 2020. Now, the two companies are eager to hike the scale of their partnership.

Earlier this year, CATL announced an ambitious plan to build a new battery manufacturing plant in Hungry, with annual production capacity of 100 GWh. Mercedes-Benz is reportedly going to be the first partner to receive battery cells from the upcoming Hungarian plant. The exact number of battery cells to be supplied by CATL to luxury car brand hasn’t been disclosed yet.

In July 2021, Mercedes-Benz had set a goal to go fully electric by the end of the current decade; of course, if market conditions will allow. It will require more than 200 GWh of battery cells per annual for the German brand to achieve that goal.

Such a high volume of battery cells is expected to be provided by an estimated eight local lithium-ion battery plants, including four in the European region. It means that the company will need to set up each battery pant with 25 GWh (on average) annual production capacity.

The Chinese manufacturer’s upcoming battery plant in Hungary will likely produce and supply battery cells for the next-generation models of Mercedes-Benz. While details remain scarce, emerging reports suggest that models like EQA and EQB will come equipped with LFP batteries, with series production starting in 2024. It may be noted here that CATL has specialization in LFP chemistry.

Markus Schäfer, Member of the Board of Management of Mercedes-Benz Group, described the new European CATL plant in Hungary as “another milestone” for the scale-up of the company’s EV production together with its key partners.

Speaking on the topic, Schäfer said, “With CATL we have a technology-leader as our partner to provide us – as the first and biggest customer of the new plant’s initial capacity – with top-notch CO2 neutral battery cells for our next generation EVs in Europe, hence following our local-to-local approach in procurement.”

Schäfer went on to say that Mercedes-Benz is proud to see its Ambition 2039 supported by CATL’s commitment to carbon neutral production in Hungary. Obviously, Mercedes-Benz is also making use of batteries produced by other battery manufacturers around the world, but CATL remains a crucial partner for it, at least in Europe.