GUANGZHOU -- CATL, the world's largest producer of electric vehicle batteries, will spend up to 13.5 billion yuan ($2.09 billion) on a plant in China to produce a new type of lithium battery.
The Chinese manufacturer struck an agreement Monday with the Jiangxi Province city of Yichun to build the plant. The factory is expected to produce automotive batteries, such as those for EVs.
The production capacity and construction start date have not been disclosed, but the company said the facility is meant to expand operations in response to market demand.
Including joint venture locations, CATL plans to build or expand about 20 domestic factories and one in Germany, according to Chinese brokerage SooChow Securities. The company's total battery production capacity is projected to reach roughly 600 gigawatt-hours in 2025, or quintuple the level in 2020.
CATL, formally known as Contemporary Amperex Technology Co. Ltd., has increased spending to expand production over the past two years. In February 2020, the company announced a plan to invest as much as 26 billion yuan to boost capacity.
In December, CATL outlined a plan to invest up to 39 billion yuan, then announced this February a decision to invest up to 29 billion yuan. To fund the fresh spending, CATL said last month that it plans to raise as much as 58.2 billion yuan through a private share placement.