Volkswagen teams up with China's CATL to work on EV battery development

(Sharecast News) - Volkswagen has signed a deal with China's CATL to collaborate on EV battery research and development as well the development of new materials and auto parts. VW also said it was working separately with CATL to come up with "cost-competitive" battery concepts and products.

The companies said they are jointly developing innovations in the battery recycling and vehicle-to-grid (V2G) markets, among other things.

The strategic partnership comes amid rising competition in the Chinese EV industry, with domestic brands innovating at a rapid pace to launch cheaper vehicles than Western manufacturers.

CATL, formally known as Contemporary Amperex Technology Limited, is a supplier to American EV giant Tesla and is thought to hold nearly a 40% market share of the EV battery market, according to figures from SNE Research.

Last month, VW reported that it produced 745,000 battery-electric vehicles in the fourth quarter of 2024, down 3.4% on the previous year, though BEV deliveries in China were up 8%, compared with a 30% decline in the US market.

Volkswagen shares were up 1.2% at €102.50 by 1154 in Frankfurt.