Stellantis and CATL to Build Battery Factory in Spain

Stellantis and CATL have announced a €4.1 billion ($4.3 billion) joint venture to establish a lithium iron phosphate (LFP) battery factory in Zaragoza, Spain, with a production capacity of up to 50 GWh, expected to begin by the end of 2026. This partnership, structured equally between the two companies, aims to enhance local electric vehicle (EV) production capabilities amid increasing demand across Europe, fueled by the EU's 2035 ban on internal combustion engine vehicles. The factory will leverage Spain's renewable energy sources, contributing to carbon neutrality and local economic growth. Alongside its strategic location, Spain's government incentives for EV adoption further support this investment, which is seen as a response to rising competition from Chinese automotive brands. In the backdrop of this announcement, Stellantis is also addressing internal leadership changes following the recent departure of CEO Carlos Tavares, with positive market reactions noted in the stock performance. The venture reflects a broader trend among automakers to localize battery production to reduce reliance on Asian imports.