CATL reported a net profit of 20.7 billion yuan (about $3.06 billion) for the first quarter, up 48.5% year-on-year, on revenue of 129.1 billion yuan (about $17.9 billion). The standout comparison is not the growth rate but the scale: that one quarter’s profit was larger than the combined quarterly net profit of seven of China’s largest automakers - the very companies CATL supplies batteries to.
Set against the carmakers individually, the gap is stark. Chery earned about $616 million in the quarter, Geely about $614.5 million, and BYD about $602.7 million. Add SAIC, GWM, Seres, and Changan, and the seven together come to roughly $2.6 billion - still short of CATL’s $3.1 billion from selling the cells inside their cars.
The reason is structural. CATL holds about 46.4% of the global battery market, up 3.47 points year-on-year, and that scale gives it pricing power and margins the carmakers cannot match while they fight a domestic price war. The battery is the single most expensive part of an electric car, and the supplier of that part is capturing more of the profit than the brands assembling the finished vehicle.
It is the EV supply chain compressed into one line. As automakers cut prices to hold share, the component maker at the center of the industry keeps widening its lead - a position that will shape how much room carmakers have to keep cutting.
