Revenue of CATL, the world’s largest electric vehicle (EV) battery manufacturer, surged to 64.29 billion yuan in April-June, from 24.91 billion yuan a year ago, Reuters calculations showed.
CATL has achieved 164 percent increase in its profit to 6.68 billion yuan ($974.61 million) from April to June as Chinese authorities rolled out incentives to boost EV sales to cushion the impact of lockdowns during the period.
CATL’s clients include Tesla, Volkswagen and BMW.
The company said that a COVID outbreak during the period, which included lockdowns in several cities including Shanghai, had some impact on its domestic market. Demand, however, remained strong as local authorities rolled out incentives to promote EV sales and companies launched new models.
EV sales growth bucked an overall trend of weakening auto sales in the major markets of China, Europe and the United States, CATL said.
In China, EV sales surged 120 percent in the first half, while overall vehicle sales fell 6.6 percent, said the China Association of Automobile Manufacturers.
CATL’s profit margin on EV batteries fell to 15.04 percent from 22 percent at the end of 2021 due to rising metal prices, especially lithium.
CATL in a statement said it had taken measures including signing long-term contracts with suppliers, recycling materials and negotiating a dynamic battery pricing scheme with automakers to ease the pressure of rising costs.
The company is accelerating its expansions in overseas markets with contracts to supply batteries to clients including Mercedes-Benz and BMW in Europe and Ford in the United States, where government incentives are driving demand for EVs.
CATL announced earlier this month that it would build a $7.6 billion battery plant in Hungary, Europe’s largest so far.
CATL’s market share in the global EV battery market reached 34.8 percent in the first half, extending its lead with a 6.2 percentage points increase from a year ago, according to data from SNE Research.
South Korea’s LG Energy Solution, which posted a 73 percent plunge in the second quarter profit, followed CATL with a share of 14.4 percent.