Netherlands-headquartered automaker Stellantis and Chinese battery manufacturer CATL have agreed to invest up to €4.1 billion to form a 50/50 joint venture that will build a large-scale lithium iron phosphate (LFP) battery plant in Zaragoza, Spain.

The battery plant is targeted to start production by the end of 2026 at Stellantis’s Zaragoza site. It will be implemented in several phases, and could reach up to 50 GWh of annual capacity. This will depend on the evolution of the EV market in Europe and continued support from authorities in Spain and the European Union, the companies said.

The agreement follows a non-binding memorandum of understanding (MOU) the companies signed in November 2023 for the local supply of LFP battery cells and modules and a long-term collaboration on two strategic fronts—creating a technology roadmap to support Stellantis’s EVs and identifying opportunities to further strengthen the battery value chain.

CATL operates battery manufacturing plants in Germany and Hungary. The Spanish facility will enhance its capabilities to supply European automakers as well as the global market.

Stellantis is employing a dual-chemistry approach—using lithium-ion nickel manganese cobalt (NMC) and lithium iron phosphate (LFP) batteries. The JV will enable the automaker to offer more electric passenger cars, crossovers and SUVs in the B and C segments with intermediate ranges in Europe.

“Stellantis is embracing all available advanced battery technologies to bring competitive electric vehicle products to our customers,” said Stellantis Chairman John Elkann. “This important joint venture with our partner CATL will bring innovative battery production to a manufacturing site that is already a leader in clean and renewable energy.”

Source: Stellantis