A New Chapter in EV Production: The Zaragoza Battery Plant
Stellantis, the automotive giant that makes the Jeep Wrangler and Peugeot 208, among many others, and CATL, the world’s top electric battery manufacturer, are to build a lithium iron phosphate (LFP) EV battery plant in Zaragoza, a city in northeastern Spain.
Their new €4.1 billion factory is expected to have a battery-production capacity of up to 50 gigawatt-hours (GWh) by the end of 2026.
For Europe, this joint venture represents an important milestone toward becoming a global hub for EV manufacturing (EV stands for ‘electric vehicle’).
The two companies stated that their project will rely on renewable energy sources, ensuring the plant achieves carbon neutrality. Their partnership focuses on two key objectives:
- Meeting the growing demand for advanced and affordable EV batteries.
- Supporting Europe’s climate change mitigation goals.
Collaborating for Sustainability and Innovation
This joint venture is part of a broader collaboration between Stellantis and CATL, following their 2023 memorandum of understanding (MOU) to strengthen the EV battery supply chain in Europe.
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What Stellantis Brings to the Table…
Stellantis will leverage its experience in automotive manufacturing and its dual-chemistry strategy, which includes lithium-ion nickel manganese cobalt (NMC) and LFP batteries, to provide efficient, cost-effective EV solutions.
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…and what CATL Brings
CATL, with its proven expertise in cutting-edge battery technology, will contribute its know-how (expertise) from its existing facilities in Germany and Hungary.
The new facility in Spain will boost CATL’s capacity to meet growing customer demand. It will also solidify the company’s position as a world leader in EV battery production.
Boosting Europe’s Green Transition
The European Union has set an ambitious target to phase out internal combustion engine vehicles by 2035.
The following quote comes from an announcement by the European Parliament in 2022 (updated in 2023):
“EU ban on the sale of new petrol (gasoline) and diesel cars from 2035 explained. All new cars and vans sold in the EU as of 2035 should not produce any CO2 emissions. This is to ensure that by 2050, the transport sector can become carbon neutral.”
This new joint venture aligns with the EU’s green transition goals perfectly. It reduces Europe’s dependency on battery imports from Asia and boosts local manufacturing capabilities.
Over the past ten years, Spain’s importance in Europe’s EV system has grown considerably.
Today, it is the second-largest car producer in Europe, and this project further reinforces its role in driving sustainable mobility.
The city of Zaragoza is already recognized for its commitment to renewable energy. Stellantis and CATL chose Zaragoza for the site of their plant partly because of the city’s commitment to renewable energy.
Economic and Environmental Benefits
The Stellantis-CATL partnership is expected to provide a significant boost to the local economy by creating jobs and attracting further investment.
It also sets a precedent for sustainable manufacturing, with plans to utilize Spain’s abundant solar, wind, and hydropower resources.
Stellantis Chairman John Elkann, said:
“Stellantis is committed to a decarbonized future, embracing all available advanced battery technologies to bring competitive electric vehicle products to our customers.”
“This important joint venture with our partner CATL will bring innovative battery production to a manufacturing site that is already a leader in clean and renewable energy, helping drive a 360-degree sustainable approach. I want to thank all stakeholders involved in making today’s announcement a reality, including the Spanish authorities for their continued support.”
Robin Zeng, Chairman and CEO of CATL, said:
“The joint venture has taken our cooperation with Stellantis to new heights, and I believe our cutting-edge battery technology and outstanding operation knowhow combined with Stellantis’ decades-long experience in running business locally in Zaragoza will ensure a major success story in the industry.”
“CATL’s goal is to make zero-carbon technology accessible across the globe, and we look forward to cooperating with our partners globally through more innovative cooperation models.”
Conclusion
For Europe’s EV industry, the Stellantis-CATL joint venture represents a transformative step.
By combining cutting-edge technology and a commitment to sustainability, this project aims to achieve two major objectives:
- Helping the region meet its environmental goals.
- Fostering economic growth.
The Zaragoza battery plant will be a cornerstone of the green transition, paving the way for a cleaner, electrified future.