[Edaily Reporter SOYEON KIM ] Chinese battery manufacturer CATL has begun trial production at its battery cell plant in Debrecen, Hungary. By establishing its largest production base outside of China in Europe, the company is moving to expand its local supply. As the U.S. electric vehicle (EV) market contracts, Europe—where growth is picking up—is emerging as a key battleground for global battery companies.

According to industry sources on the 6th, CATL recently began trial operations on two production lines at its newly constructed battery cell plant in Debrecen, Hungary. This phase is intended to validate production equipment and manufacturing processes prior to full-scale mass production.

Once the plant is fully operational, its annual production capacity will reach 100 GWh, making it the largest of CATL’s production facilities outside China. This volume is sufficient to power approximately 1.2 million to 1.6 million electric vehicles annually. CATL has been producing battery modules in Debrecen since 2024 and plans to expand into cell production to strengthen its local supply chain in Europe.

Another advantage of local production is that a battery’s country of origin is determined based on the actual production location rather than the company’s nationality. Lee Hyun-wook, an analyst at IBK Investment & Securities, predicted, “Even for a Chinese company like CATL, if battery cells are actually produced at a factory in Hungary or Germany, those cells will, in principle, be recognized as originating in the European Union (EU).”

CATL’s push into Europe is gaining momentum amid rising barriers to entry in the U.S. market. Chinese-made batteries face restrictions on market access due to U.S. regulations, and the U.S. electric vehicle (EV) market has also contracted following the elimination of subsidies. In contrast, the European EV market is regaining its growth momentum. CATL is accelerating its localization efforts in Europe by expanding its production bases to Hungary following Germany and establishing a joint venture (JV) in Spain.

From January through August of this year, registrations of battery electric vehicles (BEVs) in 16 major European markets exceeded 1.67 million units, a 33.1% increase compared to the same period last year. In August, the growth rate reached 54.2%, with BEVs accounting for about one-third of new car sales.

As the European market expands, competition among battery manufacturers for market share is intensifying. According to SNE Research, battery usage in European electric vehicles from January through July of this year totaled 160.8 GWh, a 29.7% increase compared to the same period last year. CATL maintained its lead with 71.8 GWh, capturing a 44.6% market share.

In contrast, the combined market share of the three major South Korean battery manufacturers shrank from 35.2% to 29.0% during the same period. Although LG Energy Solution saw an increase in battery usage, its market share declined, while SK On and SAMSUNG SDI CO.,LTD. also performed relatively poorly. Meanwhile, Chinese companies such as BYD, SVOLT, CALB, and EVE are expanding their presence in the European market with rapid growth.

An industry official stated, “Chinese companies, including CATL, are rapidly expanding their local production capacity in Europe,” adding, “The battery market is turning into a ‘market share war’ over which company can secure the most European automaker customers.”