BEIJING, July 27 (TMTPost)— Contemporary Amperex Technology Co. Ltd. (CATL), the top electric vehicle (EV) batter maker in the world, posted record high profits in the first half of the year despite slowdown in the past quarter.

Credit：Visual China

CATL reported net income of RMB20.72 billion (US$2.9 billion) in the first six months of 2023, hitting a record high with a year-over-year (YoY) growth of 153.6%, according a statement on Tuesday. The profit growth was driven by robust sales. Revenue in the first half of the year surge 67.5% YoY to RMB189.3 billion. Gross margin in the same period rose to 21.6% compared with 18.15% a year ago. However, growth in the second quarter slowed down following the shockingly performance in the start of the year. Net income in the quarter ended June 30 climbed to RMB10.9 billion with a 63.2% YoY increase, while the previous quarter saw a record yearly growth of 557.97%. Revenue in the second quarter gained 56% to RMB10.03 billion after the first quarter’s YoY increase of 82.91%.   

CATL said its financial results mainly resulted from the booming green energy industry. As the continuous launch of quality new energy vehicle (NEV) models, increasing  consumer recognition along with worldwide policymakers’ increasing focus on NEV, global NEV market continues to grow, leading to a rapid increase in the scale of the power-battery sector, CATL said in a statement. Besides, the batter energy storage market has ushered in an era of rapid growth thanks to implementation of policies to support energy storage in countries across the world, ongoing improvement in energy storage efficiency and increase in the proportion of renewable energy generation in total installed capacity, the company added.

Industry data showed CATL cemented its leadership even the domestic electric vehicle (EV) battery market cools this year. CATL maintained the first place by power battery usage with a global market share of 36.3% from January to May, up 1.7 percentage points from a year earlier, according to SNE Research. Data from the South Korea-based market research firm showed CATL’s share in markets beyond China added 6.9% points YoY to 27.3%, and share in Europe stood at 34.5%, both ranked top for the second consecutive month.

In the first six months of the year, CATL’s power battery output in China was 66.03 gigawatt-hours (GWh) with a 43.4% share of domestic market, up from the same period of last year’s 47.67%, according to the China Automotive Battery Innovation Alliance. The same industry body estimated batter installation volume in the first half of the year grew by 36.8%, much weaker than 176.4% growth in the same period in 2022.

Recent news suggested CATL was seeking negation for a more favorable pricing in the industry chain to improve its gross margin. The Fujian-based company was reported last week to ask lithium carbonate suppliers to offer 5% to 10% discount in settling prices of the industrial chemical that is mainly used in lithium-ion batteries. The reported discount is only an execution of CATL’s request for a price cut of 10% to suppliers in the early of the year, Chinese digital newspaper The Paper later learned from industry sources. According to the sources, CATL’s effort is to obtain more pricing room in face of its auto-making customers while avoid squeezing gross margin. In order to maintain its market share, CATL is expected to talk to automakers to seek cash rebated by the end of the year, the industry insider said.