CATL receive Benchmark’s top tier lithium ion battery producer status

Contemporary Amerpex Technology Co Ltd (CATL) reach Tier 1 lithium ion battery manufacturer status, as assessed by Benchmark Mineral Intelligence.

Benchmark‘s Tier 1 status, analysed via our Lithium ion Battery Megafactory Assessment service, is the highest ranked tier of three categories of the world’s lithium ion battery makers (scroll for more).

It is assigned to cell manufacturers who can produce the highest quality lithium ion batteries, at scale, for western automotive uses and that are qualified to supply major electric vehicles markets outside of China.

CATL joins LG Chem, Samsung SDI, Panasonic-Tesla, SK  Innovation, and Envision-AESC (AESC) as tier one lithium ion battery producers from an assessed total of 70 battery-makers worldwide, operating from 64 active lithium ion battery plants (February 2020 Assessment).

CATL’s rise to Tier 1 producer has been widely anticipated.

Benchmark’s Tiers of Automotive Lithium ion Battery Producers. Click to scroll to our methodology.

CATL & LG Chem lead global battery arms race

With a number of battery factory expansions in the pipeline, CATL is now also the world’s leading battery manufacturer by capacity (including joint venture battery factories).

Last year, CATL had 77GWh of lithium ion battery capacity in 2019, compared to the world’s second largest battery cell maker, LG Chem, which expanded to 66GWh of capacity. Both battery producers have been especially aggressive in expanding cell capacity in the wake of what Benchmark described back in 2015 as a ‘global battery arms race’.

In the last 5 years, the number of battery megafactories in the pipeline out to 2029 – a ten year horizon assessed by Benchmark‘s service – have risen from 3 to 123.

Having only been founded in 2011, CATL, has been China’s battery champion, and has led domestic growth in battery cell capacity from its HQ in Nindge, and become industry’s most powerful entities.

February saw unexpected news as it was reported that CATL would supply Tesla with prismatic lithium iron phosphate (LFP) battery cells for Tesla’s standard-range Model 3 in China as revealed by Benchmark. 

Much of CATL’s current and future capacity is located in China, where eight out of nine of its battery factories are located. Its sole international venture to date being in Erfurt, Germany which is expected to begin production in 2022.

CATL’s Germany plant is, however, destined to be one of its biggest with a 70GWh capacity in 2029, which makes it the producer’s second biggest plant, and Europe’s largest megafactory in the pipeline.

Over half of the battery pipeline not qualified

The promotion of CATL to Tier 1 has changed the battery tier landscape.

Benchmark‘s data now shows that 45% of installed capacity by 2024 and 46% by 2029 is now forecasted to come from Tier 1 producer batteries that are qualified for use by automotive OEMs outside of China.

As a result, 54% of lithium ion battery capacity or 1,234GWh or enough batteries to make 22m EVs is set to be from Tier 2 and Tier 3 producers that are not yet qualified for use in EVs outside of China.

Quality will remain a critical issue for Europe and US automakers seeking to a wholesale shift to EVs.

Caspar Rawles, Head of Price Assessments at Benchmark said:

“With CATL achieving Benchmark’s Tier 1 lithium ion battery producer status, this will give European and North American automakers another much need option for their cell sourcing strategy.

Recently we have seen a number of automakers complain of being ‘cell constrained,’ limiting their ability to produce even small numbers of EVs.

“As auto production targets grow, this problem is only set to get worse.

“The challenge for CATL will come when they look to ramp production to double digit gigawatt-hour levels at their new battery megafactories, which has typically stifled even the most experienced of battery cell manufacturers.

“The task of producing extremely high-quality cells at the volumes needed to fulfil automotive grade contracts is not easy and may take longer than CATL expects.”

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Methodology: what is Benchmark’s criteria to become a tier one lithium ion battery producer?

Not all lithium ion batteries can be used in all electric vehicles. For industry, there is a fine balance of what Benchmark calls the ‘Three Qs’ of quality, quantity and qualification.

The definition of each tier used in Benchmark Minerals’ Lithium ion Battery Megafactory Assessment is as follows and shown in the diagram below:

Tier 1: 
  • Qualified to supply multinational automotive OEMs / EV producers outside of China
  • Supplier to domestic Chinese EV market
  • >5 GWh of annual cumulative capacity (equivalent at time of assessment)
Tier 2:
  • Not yet qualified to supply multinational automotive OEMs / EV producers outside of China
  • Qualified to supply domestic Chinese EV manufacturers
  • Qualified to supply non EV applications
  • >1GWh of annual cumulative capacity (equivalent at time of assessment)
Tier 3:
  • Not yet qualified to supply EV end markets
  • >1GWh of annual cumulative capacity (equivalent at time of assessment)
  • Primary focus: non EV markets including portable and stationary

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How often does Benchmark assess these tiers?

Benchmark assesses these tiers of quality every three calendar month in its Lithium ion Battery Megafactory Assessment – a subscription service analysing all of the world’s lithium ion battery plants.

How can I get access to Benchmark’s Battery cell database and analysis?

Or call Gary Bernard, Business Group Manager on +44 203 960 9980

I am a lithium ion battery producer. How do I submit data for your analysis?

To submit data to our Lithium ion Battery Megafactory Assessment, contact Caspar Rawles, Head of Price Assessments, on [email protected]