Stellantis and CATL to invest €4.1 bn in joint Spanish battery plant

The Stellantis logo pictured on a banner outside the Opel plant in Eisenach. Martin Schutt/ZB/dpa

The multinational car maker Stellantis and the Chinese battery giant CATL are to invest up to €4.1 billion ($4.3 billion) in a joint battery cell factory in Spain, the companies said in a statement on Tuesday.

Production of the factory for lithium iron phosphate (LFP) cells in the north-eastern Spanish city of Zaragoza is scheduled to begin at the end of 2026, they said.

The plans include several expansion stages. The factory could eventually produce up to 50 gigawatt hours of battery capacity annually, the statement said.

The announcement follows a letter of intent signed by the companies just over a year ago.

Stellantis - the parent company of Opel, Fiat, Chrysler and others - intends to use the batteries in smaller, compact cars and SUVs with medium ranges.

LFP batteries are in competition with lithium-ion cells, which are conventionally used in car batteries. LFP cells are cheaper to manufacture and last longer, but supply less energy than traditional lithium-ion cells.

The factory's capacity would be enough to equip over 900,000 Opel Mokka electric cars, each with a battery capacity of 54 kilowatt hours, the statement said.

The deal is expected to close in 2025, with the joint venture to be equally owned by Stellantis and CATL.