CATL Balances 1,000 GWh Ambition Against Margin Squeeze as Chinalco Deal and Sichuan Lithium Plant Take Shape
Published on 11/09/2026 at 08:31 | Editorial boerse-global.de
CATL is pursuing growth on several fronts at once, but the market is fixated on a simpler question: whether the battery giant can keep expanding volumes without surrendering pricing power. That tension was on display Friday, when the stock fell 3.7% after JPMorgan trimmed its targets, even as the company unveiled a far-reaching strategic partnership with aluminium producer Chinalco and moved a major lithium project closer to approval.
The dual-track story — ambitious capacity plans on one side, softer per-unit economics on the other — has given investors two very different sets of yardsticks to watch.
JPMorgan Cuts Targets on Tax Pass-Through Woes
The US bank lowered its price target on CATL's A-shares to RMB300 from RMB310 on Friday, though it kept an overweight rating on that share class. For the H-shares, JPMorgan maintained a neutral stance. The common thread: passing on tax costs is proving harder than the brokerage had anticipated, and it also marked down its earnings-per-unit assumptions for the Chinese battery sector.
The downgrade landed alongside CATL's own third-quarter update, which showed profit growth decelerating. Net income for Q3 2026 rose 14.5% year on year to RMB21.2 billion, while revenue climbed 58.6% to RMB165.2 billion. According to Reuters, that was the weakest earnings growth in nearly two years, reflecting fiercer competition and cooling Chinese car sales.
Zeng Sets Sights on Terawatt-Hour Era
Against that backdrop, Chairman Robin Zeng used an October 31 appearance to sketch out a far more expansive future. CATL expects to ship more than 1,000 GWh in 2026, he said, describing the company as entering the terawatt-hour era. For context, deliveries in 2025 totaled 661 GWh.
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The overseas picture offers some support for that ambition. CATL's installations of electric-vehicle batteries outside China jumped 46.7% to 143.7 GWh between January and September 2026, according to SNE Research. That gave the company a 33.7% share of the segment.
Chinalco Pact Spans Materials, Recycling and Green Power
Alongside the volume story, CATL is widening its grip on the inputs that feed those batteries. A strategic cooperation with Chinalco, disclosed in Ningde, covers research into new non-ferrous metal materials and the recycling of metals. It also takes in direct access to green electricity and support for global supply chains.
A further element is the integrated management of power generation, grid, consumption and storage at high-altitude sites — a niche that ties the material side of the business to energy supply. No specific metal volumes or delivery commitments were disclosed, so the commercial weight of the agreement will hinge on which projects the two partners actually execute. For investors, binding supply relationships and concrete investment decisions will say more than the number of workstreams listed.
Ya'an Lithium Plant Awaits Environmental Green Light
More tangible are CATL's plans for Ya'an in Sichuan, where it envisages total investment of RMB1.4 billion. The local environmental authority published the proposed approval of the project's environmental impact report on Friday, with the window for public comments running until November 12.
Once completed, the facility is designed to produce roughly 40,000 tonnes of battery-grade lithium carbonate and 30,000 tonnes of battery-grade lithium dihydrogen phosphate annually, with anhydrous sodium sulphate emerging as a by-product. A CATL subsidiary established in August is slated to handle construction.
The project would give CATL an in-house operational piece of its upstream material supply — provided permitting and subsequent build-out stay on track. That makes the environmental process the first hurdle to clear, just as the Chinalco tie-up's next binding implementation steps are the ones to watch on the partnership side. Only as those milestones are met will it become possible to gauge what either initiative genuinely contributes to the bottom line.
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