China’s battery-making titan CATL is transforming electric vehicle batteries from mere commodities into strategic tools of foreign policy across the Asia-Pacific.
Backed by massive investments spanning Southeast Asia’s entire battery value chain—from raw materials to recycling—CATL has extended its influence in line with Beijing’s global industrial ambitions.
The critical question for ASEAN and regional players is whether CATL will serve as a foundation for industrial sovereignty and sustainable growth, or instead deepen economic dependence on Chinese capital and technology?
Many analysts argue that CATL’s rise is not just about batteries—it’s about who will control the green energy architecture of the 21st century.
As of the first half of 2025, CATL retained its global lead in the electric vehicle battery sector, commanding a 37.9% market share (190.9 GWh out of 504.4 GWh in global installations). This puts it well ahead of competitors like BYD (17.8%) and LG Energy Solution (approximately 9–10%).
Some reports place CATL’s share even higher, at 38.1% between January and May. Japanese and Korean firms such as Panasonic and Samsung SDI, along with newer European battery makers, continue to trail with only single-digit market shares.
CATL’s competitive edge lies not only in its scale but also in its technological leadership—most notably in innovations like cell-to-pack architecture, lithium iron phosphate (LFP) chemistry, and ultra-fast charging, enabling up to 320 miles of range in just five minutes.
These advances position CATL not merely as a supplier, but as a global standard-setter in the emerging green energy order. In June and July 2025, CATL broke ground on a US$6 billion “Indonesia Battery Integration Project” spanning West Java (Karawang) and North Maluku.
This ambitious initiative covers the entire battery value chain—from nickel extraction and processing to battery cell and module production, as well as recycling—across a 2,000–3,000-hectare site.
The facility aims for an initial annual capacity of 6.9 GWh, scalable to 15 GWh or even 40 GWh with solar-storage capabilities. The project is expected to create 8,000 direct and 35,000 indirect jobs, further cementing Indonesia’s strategic role in the global EV battery ecosystem.
CATL is also deepening its footprint through battery-swapping networks and partnerships in Thailand, Indonesia and Vietnam—an emerging pan-Asian infrastructure that could generate over $10 billion annually by 2030.
These networks enhance vehicle affordability while embedding CATL deeply into regional markets and everyday mobility habits.
At the same time, global financiers are increasingly tying capital flows to stricter environmental, social and governance (ESG) standards. ASEAN governments must ensure that Chinese-backed battery investments align with these benchmarks, or risk damaging their credibility with international investors.
Despite CATL’s market dominance, geopolitical scrutiny is intensifying. The US Department of Defense has blacklisted the company over alleged military ties, triggering a sharp decline in its stock price and leading to restrictions on Pentagon contracts by 2026–2027. In parallel, the US is tightening export controls on battery technologies, citing national security risks.
Beyond military blacklists and export controls, CATL also faces structural resistance from Western industrial policies. In the United States, the Inflation Reduction Act (IRA) explicitly seeks to reshore EV supply chains and exclude Chinese firms from subsidy eligibility—effectively walling off CATL despite its scale and technological edge.
In Europe, the EU has launched anti-subsidy investigations into Chinese EVs and batteries, even as individual member states like Hungary and Spain actively court CATL’s multibillion-dollar investments.
For many in Brussels, growing reliance on CATL evokes uncomfortable comparisons to Europe’s past dependence on Russian energy—this time in the strategically vital realm of green technology.
CATL’s 2025 Hong Kong IPO raised approximately $4.6 billion, signaling strong investor confidence despite mounting geopolitical headwinds. The funding is earmarked for expanding CATL’s manufacturing footprint in Europe—particularly in Hungary and Spain—and across Asia, reinforcing its global strategy.
The IPO also highlighted Beijing’s backing for CATL as a national champion, with Chinese state-linked funds among the cornerstone investors. Analysts noted that the listing—one of Hong Kong’s largest in recent years—demonstrated global capital’s continued willingness to bet on CATL, even amid escalating Western trade barriers.
For host countries, CATL represents both opportunity and risk: the promise of industrial modernization and a low-carbon transition on one hand, and the challenges of power asymmetry, environmental pressures from mining and geopolitical entanglements on the other.
As with BYD, regional leaders must carefully calibrate policy to leverage CATL’s benefits while protecting national autonomy. This balancing act requires not only strong domestic regulation but also coordinated regional strategy, as fragmented approaches risk deepening dependence on Beijing.
Ultimately, how Southeast Asian governments manage CATL’s expanding footprint will be a litmus test of their ability to convert foreign capital into sovereign advantage.
CATL’s rise reflects how China aligns its industrial champions with broader strategic ambitions. Whether ASEAN states can harness this momentum for sovereign growth—or risk drifting into strategic dependency—will depend on the clarity of their policy vision.
The region’s response will help determine whose blueprint shapes the future of the global EV battery ecosystem. In this light, the EV battery race is no longer just about technology or economics—it is about strategic choice.
For ASEAN, how it engages with CATL may well define its position in the green order of the 21st century.
Akhmad Hanan is an independent researcher specializing in the intersection of geopolitics and energy
