SHANGHAI — China’s CATL plans to construct a 7.3 billion euro ($7.6 billion) battery plant in Hungary, because the world’s greatest electrical automobile battery maker gears as much as meet rising demand from international automakers.

CATL mentioned that development of the 100 GWh (gigawatt hours) plant within the jap Hungarian metropolis of Debrecen, its greatest abroad funding, would begin this yr after receiving approvals, and will final not more than 64 months.

As soon as constructed, it’s set to be Europe’s largest battery cell plant and CATL’s second within the area after one in Germany, making battery cells and modules for carmakers together with Mercedes-Benz, BMW, Stellantis and Volkswagen.

The enlargement comes as European automakers speed up a transition to electrical automobiles of their residence markets, prompting surging demand for batteries from native suppliers and inflicting a run on provide offers to keep away from manufacturing bottlenecks.

VW, Mercedes-Benz and Tesla have all introduced or began to implement main battery enlargement plans in Europe to safe entry to very important cells and uncooked supplies and assist their electrification methods.

CATL’s funding will mark “a large leap in CATL’s international enlargement,” the corporate’s founder and chairman Zeng Yuqun mentioned in an announcement on Friday.

The Chinese language firm can also be urgent forward with plans for battery manufacturing in North America by 2026 for shoppers together with Ford Motor, Reuters reported earlier, regardless of tensions between Beijing and Washington.

The Hungary funding can also be key for the jap European nation, which is turning into a significant hub for electrical automobiles and batteries in Europe.

Debrecen is residence to a plant being constructed by BMW, whereas Volkswagen’s Audi model has a manufacturing unit in western Hungary’s Gyor and Mercedes operates one in Kecskemet, within the central a part of the nation.

BMW declined to remark however mentioned it plans to launch some battery associated data in early September. VW and Stellantis didn’t instantly reply to requests for remark.

Mercedes mentioned in a separate assertion it might be the primary associate to obtain battery cells from CATL’s Hungarian plant, and tha its order marked the very best preliminary order quantity for the location.

“This new state-of-the artwork European CATL plant in Hungary is one other milestone for the scale-up of our EV manufacturing along with our key companions,” Mercedes-Benz administration board member Markus Schaefer mentioned.

CATL beforehand mentioned it might begin supplying cylindrical cells to BMW from 2025 for its new sequence of electrical automobiles.