According to news on February 17 from multi sources (Guanwang Finance etc), several industry chain sources revealed that CATL is currently actively promoting a lithium ore rebate plan to car companies to reduce battery prices.

According to sources, the plan is not aimed at all customers, but for strategic customers such as Li Auto, NIO, Huawei, and Zeekr. The core terms are: in the next three years, the price of lithium carbonate for some power batteries will be settled at 200,000 yuan/ton. At the same time, the car companies that sign this cooperation need to commit about 80% of their battery purchases to CATL. After the cooperation is signed, the supply will start in the third quarter of this year.

The sources also said that the applicable customers of the “lithium ore rebate” are companies that are considered by CATL to have relatively high domestic shipments, and Tesla is not among them.

Power batteries are the main cost component of electric vehicles. During the epidemic, the rising cost of battery raw materials has seriously affected the profitability of car companies, resulting in high prices for new energy vehicles.

According to data from the Lithium Battery Research Institute (GGII), China’s lithium battery shipments will reach 655GWh in 2022, a year-on-year increase of 100%.
Last year, the average price of domestic battery-grade lithium carbonate was about 480,000 yuan/ton, and the annual highest price reached nearly 600,000 yuan/ton. Therefore, Zeng Qinghong, chairman of GAC Group, once said with a smile that he was working for CATL.

However, with the reduction of subsidies for new energy vehicles, the decline in the sales growth rate of new energy vehicles, and the increase in sales of plug-in hybrid vehicles with lower power, the price of lithium batteries will drop after entering 2023. According to data released by Shanghai Steel Union on February 16, the average spot price of battery-grade lithium carbonate is less than 450,000 yuan/ton. However, GGII expects that the price of battery-grade lithium carbonate will usher in a market inflection point in the second quarter of this year.