(Bloomberg) -- China’s Contemporary Amperex Technology Co. Ltd. is in talks to establish battery recycling operations in Europe, adding to its footprint in the region as the company prepares to start cell production in Hungary.
The world’s largest maker of EV batteries is discussing possible sites with European governments including Hungary, said Jason Chen, CATL’s regional operations chief. A new cell-manufacturing plant in the country is on track to start production in the second half of 2025, he said in an interview in Budapest.
“Now that we’ve been here, we’d hope to have a closed loop from manufacturing to recycling right here,” Chen said.
The company is also scouting for local suppliers, including for raw materials, Chen said. Some have already sent along test samples, he said, though those talks are preliminary and must meet competitive requirements.
Like other Chinese players, CATL sees growth potential in Europe’s EV market after establishing its base at home. Localized production and procurement in the region would help address concerns over jobs threatened by the dominance of Chinese firms as the autos segment shifts to batteries from combustion engines.
Establishing a recycling operation will also help CATL, a supplier to Tesla Inc. and BMW AG, to mitigate environmental concerns over battery production and disposal. European firms are potential partners in this initiative, Chen said, along with CATL’s own Guangdong Brunp Recycling Technology Co.
Chen dismissed concerns over the pace of the transition to EVs, even as automakers including Volkswagen AG and Mercedes-Benz Group AG, a major customer for CATL’s output in Hungary, walk back electrification targets. CATL’s Swedish competitor Northvolt AB is scrambling to pull together emergency funding after a slow ramp-up and waning demand triggered a cash crunch.
“We didn’t see much impact so far, and we do not rely on a single client,” Chen said, adding that electrification is an “irreversible trend.”
The facility in Debrecen, about 2.5 hours by car from Budapest, is the biggest greenfield investment in Hungary. CATL is targeting annual capacity of 40 GWh in the first phase, expanding to 100 GWh, enough to power more than 1 million cars.
The company aims to hire 2,000 to 3,000 employees in the first phase, and recruit as many locals as possible, Chen said. Another CATL factory in Germany opened in 2022 and employs about 1,700.
In April, CATL also signed a memorandum of understanding with Volvo Car AB for partnership tied to battery recycling activities.
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