The world’s largest electric vehicle (EV) battery maker has seen its shares jump on their first day of trading in Hong Kong, as it made the biggest initial public offering (IPO) so far this year.
In January, the US Department of Defense added the battery maker to a list of businesses it says works with China’s military.
In December, the firm announced a tie-up with Chrysler-owner Stellantis to build a $4.3bn (£3.2bn) EV battery plant in Spain.
But US lawmakers have expressed concerns about potential national security risks surrounding the Chinese company.
In April, the chair of the House Select Committee on China wrote letters to the chief executives of JPMorgan and Bank of America, asking them to withdraw from working on CATL’s Hong Kong listing.
The largest EV battery manufacturer in the world made the largest initial public offering (IPO) this year, which caused its shares to soar on their first day of trading in Hong Kong.
More than a third of all EV batteries sold globally are made by China’s Contemporary Amperex Technology Co Limited (CATL), which also supplies major automakers like Tesla, Volkswagen, and Toyota.
As the US-China tariff war rocked the world trading system and severely impacted automakers, the listing was closely watched.
The battery manufacturer was included in a list of companies the US Department of Defense claims collaborate with China’s military in January. CATL disputes this, saying that it was a “mistake” to be on the list.
The company’s shares increased by up to 18 percent, and it raised nearly HK$35.7 billion ($4.55 billion, £3.4 billion) from the listing.
According to Neil Beveridge, head of research for Asia at Bernstein, “the stock performed very well in what is going to be a key IPO for Hong Kong given the size of the listing.”.
With a valuation of over 1 trillion yuan ($138.7 billion, £104.3 billion), CATL is already traded on the Shenzhen Stock Exchange in China.
Nearly 70% of the company’s total revenue comes from the Chinese market, which is the second-largest economy in the world.
According to Mr. Bernstein, it will be protected from Trump’s trade policies because of its comparatively small sales to the US.
He told the BBC that “the company will only be impacted to a limited extent by the direct implications of what we are seeing with tariffs.”.
Established in 2011 in the city of Ningde in eastern China, it experienced swift expansion as a result of the nation’s electric vehicle industry boom.
With 13 production facilities worldwide, the battery behemoth employs more than 100,000 people.
Following the opening of a plant in Germany in early 2023, CATL is presently constructing its second European factory in Hungary.
In December, the company announced a partnership with Stellantis, a Chrysler owner, to construct a $4.3 billion (£3.2 billion) EV battery plant in Spain. By the end of the following year, the facility is expected to be operational.
The company has six research and development centers worldwide and makes significant investments in new technology.
“We’re witnessing incredible innovations from CATL, especially in the fast charging space,” stated Tim Buckley, founder of Climate Energy Finance, an independent think tank based in Australia.
A new battery that can be charged for 323 miles (520 km) in five minutes was introduced by the company last month.
With lithium iron phosphate batteries for the EV manufacturer’s Shanghai plant, CATL is a significant supplier to Elon Musk’s Tesla.
However, the Chinese company has raised concerns among US lawmakers about possible national security threats.
JPMorgan and Bank of America CEOs were urged to step aside from their involvement in CATL’s Hong Kong listing in letters sent in April by the chair of the House Select Committee on China.
Mr. Buckley says the US should look to collaborate with Beijing on the development of renewable energy, despite Washington’s mistrust of Chinese companies.
He told the BBC, “They’re rejecting by far the best technology players in the world when it comes to clean tech.”.
