The landscape of new energy vehicle battery supply in China is undergoing a major transformation. In recent times, several car companies have begun to increase the number of their second and third battery suppliers or accelerate their research and development of batteries to reduce reliance on a single supplier – CATL. As a result, CATL has encountered a stock price crisis, with its market value evaporating by over 700 billion yuan within four months.
On September 23, Beijing Boya Tianxia Media and Cultural Development Co., Ltd.’s “Daily Figures” reported that in 2026, CATL is no longer the “default option” for Chinese car companies. The once dominant “emperor” in pricing and supply with an unyielding stance has now become the target of collective “breakups.”
In early September, after a decade of collaboration, NIO announced the launch of its own battery and gradually phased out its reliance on CATL.
Previously, NIO invested 2.65 billion yuan to increase its stake in Xinci Power to 11.17%, becoming the second-largest shareholder. The new generation of NIO L8 has adopted Xinci cells, while the first batch of the NIO MEGA still uses CATL batteries.
Xiaomi’s automobile sector follows a “self-research + external supply” model. Xiaomi announced that its newly launched Panga series models are equipped with Xiaomi’s self-developed brand “Dragon Armor Battery,” with Xinci and CMIG New Energy as the initial core partners, while some main models still retain CATL as a supplier. According to estimates, NIO and Xiaomi together account for approximately 13.6% of CATL’s domestic installed capacity.
He Xiaopeng, Chairman of XPeng Motors, also stated that XPeng batteries will be self-managed starting this year.
In June of this year, “36Kr Economics” reported that WANJIE, a brand previously exclusively supplied by CATL, plans to introduce CMIG New Energy and Guoxuan High-Tech, two second-tier battery suppliers.
As the strategies of car manufacturers’ supply chains change, CATL’s stock price has plummeted significantly. CATL’s A-share price rose to around 467.34 yuan on May 7 this year before steadily retreating. On September 15, the company’s A-shares plummeted by over 6%, hitting a new low for nearly a year. Calculated from the peak in May, CATL’s A-share value fell by over 35%, and the total market value of A+H shares evaporated by over 700 billion yuan.
On September 23, the topics “Car Manufacturers Breaking Up with CATL Collectively” and “CATL’s Market Value Evaporating by 700 Billion” trended on Weibo.
Tech influencer “Frost Leaf” stated, “The reason for this is simple — money. CATL made a profit of over 43 billion in the first half of the year, while the combined profit of 15 mainstream car companies was less than 21 billion, less than half. In 2022, Guangzhou Automobile executives complained that battery costs accounted for 60%, essentially working for CATL. It turns out they were right…
“So, all companies’ actions are quite normal. NIO invested 2.65 billion in Xinci, and the new L8 directly switched to Xinci cells. Xiaomi’s Dragon Armor battery, with supply from CMIG and Xinci. Over at XPeng, He Xiaopeng stated at the G9L launch that the entire battery design and production process is self-led, investing in CMIG, Xinci, and Honeycomb. WANJIE will introduce CMIG and Guoxuan as secondary suppliers; whoever raises prices will be replaced. Previously criticized, GAC has also begun production of Panga batteries. Everyone wants to control the supply chain.”
Automobile blogger “Crazy Pie Brother” commented, “For consumers, this is a good thing. More competition means costs can be reduced. Car companies don’t want to work for others anymore. Does this indicate the end of the good times for the emperor?
“A single battery now accounts for nearly 40% of the total vehicle cost. So, car companies producing cost-effective models will certainly use second-tier battery suppliers, but for high-end models, most of them still can’t do without CATL’s batteries in the short term.”
Financial blogger “Wealth-Attracting Queen” also believes, “Top companies like NIO and Xiaomi have been quite active recently, introducing second-tier battery manufacturers or engaging in self-research, simply put, they don’t want to work for the ’emperor’ anymore.
“In the past, there was no choice; CATL’s production capacity was in high demand, and car companies had to line up obediently. Now it’s different; battery costs account for nearly 40% of the total vehicle cost, but CATL’s net profit in the first half of the year exceeds that of over a dozen mainstream car companies combined. In a price war, where car companies’ profits are already thin, this trend is like letting the battery manufacturers make a killing.”