BEIJING – The world’s leading maker of electric vehicle batteries, Chinese firm CATL, posted a 32.9% jump in first quarter profit, even as demand for electric vehicles slows.

The firm produces more than a third of all electric vehicle (EV) batteries sold worldwide, cooperating with major brands including Tesla, Mercedes-Benz, BMW and Volkswagen.

Founded in 2011 in the eastern Chinese city of Ningde, Contemporary Amperex Technology Co., Limited (CATL) was initially propelled to success by rapid growth in the domestic market.

Net profit in the first quarter was up 32.9% year-on-year to 13.96 billion yuan (US$1.91 billion), according to a statement CATL released on the Shenzhen Stock Exchange Monday.

During the same period, CATL’s sales rose by 6.2% year-on-year to 84.7 billion yuan, the filing showed.

CATL has been aided by strong financial support from Beijing, which has sought in recent years to shore up domestic strength in certain strategic high-tech sectors.

But following years of rapid growth, the world’s largest EV market is showing signs of flagging sales in the face of a broader slowdown in consumption.

CATL warned in January that its slide in sales last year was likely due to a “decline in the prices of raw materials such as lithium carbonate”, which had forced the firm to adjust prices.

Last year saw lithium prices fall significantly, partly due to market oversupply and weaker consumer demand for EVs.

The trends have fuelled a fierce price war in the country’s expansive EV sector, putting smaller firms under huge pressure to compete while remaining financially viable. CATL is building its second factory in Hungary after launching its first in Germany in January 2023. – Nampa/AFP