Contemporary Amperex Technology Co (CATL) was established in Ningde, Fujian province, in 2011 and by 2017 had become the world’s largest electric vehicle battery maker. With a battery production totaling 12 gigawatt-hours (GWh) a year – equivalent to 27% of the total produced in China – it dwarfed Japan’s Panasonic and Warren Buffett-backed Chinese battery and electric car maker BYD. According the Chinese consulting firm GGII, in 2018 CATL’s battery production totaled 23.52 GWh, up 122% year-on-year and representing a 41% share of the Chinese market, with the closest followers far behind. So far it has spent billions of yuan to set up joint ventures with almost all major Chinese carmakers including Geely, SAIC and FAW, and the company’s global customers now include BMW, Daimler and Volkswagen.

CATL’s fast rise is the result of a combination of factors, including a deal soon after its establishment with BMW Brilliance, which was planning to launch its own electric car brand Zinoro. BMW’s joint venture choose CATL “because we had years of experiences as a high-end lithium-ion battery maker, at ATL,” Huang Shilin, Vice Chairman of CATL, told Tencent. ATL, which was founded in 1999 by Zeng Yuqun and later sold to Japan’s TDK, had been specializing in lithium-ion batteries for consumer electronics, including the iPhone. When the company started to focus on vehicle batteries, Zeng took ATL out of TDK and turned it into CATL.

BMW Brilliance choose CATL also because BYD, which was then China’s largest battery and electric car maker, was reluctant to sell batteries so as to keep its own position in the industry. Other major Chinese car makers followed BMW Brilliance in buying CATL batteries.

CATL now seems well established as the largest electric vehicle battery maker in the world, but the company recently revealed that its 2018 profit fell 7.71% to CNY3.58 billion, the first time in years, despite a 48% rise in its operating income. As the Chinese government is ending subsidies for electric vehicles by the end of 2020, local and international battery makers might try to grab a bigger market share. BYD is partnering with carmakers including Changan Auto to build battery joint ventures and to expand its annual capacity to 60 GWh by 2020, as opposed to 54 GWh by CATL. Analysts said CATL’s lead will continue for a while to come, but that the company will face more pressure than before. “In the next move, we will go global further and deepen our cooperation with carmakers in Europe, the United States and Japan,” Zeng Yuqun said. CATL will build its first European battery cell factory in Erfurt, Germany, starting production in 2021, and scale up its annual production to reach 60 GWh from 2026. CATL is also a shareholder of Finnish company Valmet, which is planning to build a battery plant in Finland this year, the China Daily reports.