BMW Brilliance Automotive Ltd. intends to source 2.8 billion Yuan ($420 million) worth of battery cells from the Chinese battery producer, Contemporary Amperex Technology Ltd. (CATL) throughout the following couple of years.
BMW is importing crude materials for the cells itself, to pass to the battery producers, specifically cobalt, and is at present arranging long term contracts with leading battery producers.
The long haul contract sees 1.5 billion euros of battery cells, originating from another CATL plant in Erfurt, in the eastern German province of Thuringia, and the rest will originate from China.
BMW Brilliance Automotive Ltd. is a joint venture between the BMW Group and Brilliance China Automotive Holdings Ltd. Business operations in comprises of production, R&D, sales, after-sales services and purchasing of BMW automobiles in China. Located in Shenyang city, this venture opened a new plant in Dadong last year.
CATL’s new manufacturing plant is to be established in Europe
China’s leading EV battery manufacturer and supplier, CATL develops R&D and manufacturing capabilities of full industry chains in vehicle and energy storage batteries, including materials, battery cells, battery management systems, battery recycling and reuse. CATL’s after-sales service is certificated by China’s national 5-star standard.
Initially, CATL reported that it would establish its first manufacturing site in Germany, while BMW asserted about the continued long term funding contract with CATL.
Nevertheless, BMW has no plans to mutually buy cells with match Daimler, which is based in Germany itself, in view of the upper hand that can be picked up, if BMW’s batteries manufactured by CATL give a more prominent range or can be charged quicker.
The joint venture will have the privilege to take part in CATL’s future fundraising plans. CATL skimmed on the Shenzhen stock trade a month ago with the aim of utilizing the returns to subsidize its 24 Giga watt-hour (GWh) capacity extension.