Recently, China’s largest electric vehicle battery manufacturer, CATL (Contemporary Amperex Technology Co. Limited), reached an agreement with Hungary to build a battery factory worth 7.34 billion euros.
This is the largest-scale investment ever obtained by the country and will become the largest battery factory in the region once completed. Why did China award such a large order to Hungary?
Located in Central Europe, Hungary is currently a member of the European Union and NATO, and maintains friendly relations with China. In 2015, Hungary was the first European country to sign a Memorandum of Understanding with China on Belt and Road Cooperation. This has helped the establishment of well-developed infrastructure within the country. Over time, Hungary has attracted numerous Chinese companies to invest and establish factories, with CATL being one of them.
Hungary is an important base for the automobile industry and supply chains in Europe. The European Union has set the target of “phasing out combustion engines” by 2035, thus promoting the electrification of automobiles. As the heart of electric vehicles, batteries have naturally become a key focus for the EU, which has repeatedly emphasized the importance of the battery industry for the EU’s green economic transition.
Chinese companies investing and establishing factories related to battery technology in Hungary highlights how Chinese enterprises have become key partners in the development of Europe’s electrification of the automotive industry. In the field of the battery supply chain, whether it’s battery manufacturing processes, material extraction techniques, or the procurement of lithium, cobalt, and other battery raw materials, China is indispensable.
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Source: Auto Age, 14 Nov, 2023.
