CATL expects its annual profit to nearly triple in 2021 after a strong rebound in Chinese electric vehicle sales through the year, the country’s largest electric vehicle (EV) battery supplier said on Friday.

Why it matters: The outlook reflects the strong consumer demand and growing profitability of EVs, as Beijing pushes for EV adoption to make China a power in the auto industry.

  • Sales of new energy vehicles (NEVs), which are mainly made up of all-electrics and plug-in hybrids, jumped nearly 160% year-on-year to 3.52 million units in 2021, according to figures published by China’s Ministry of Industry and Information Technology last month. 

Details: CATL expects to report a 2021 net profit attributable to shareholders of between RMB 14 billion and RMB 16 billion ($2.2 billion to $2.5 billion), an increase of up to 195.5% from RMB 5.6 billion a year earlier, according to a Thursday announcement (in Chinese).

  • The Chinese battery giant attributed the improvement in financial performance to a growing penetration of NEVs in the auto market, as well as increased production and tightened cost control.

Context: CATL maintained its market lead with 80.51 gigawatt-hours (GWh) of battery capacity supply in 2021, accounting for 52.1% of the Chinese EV battery market, according to figures recently published by the China Automotive Power Battery Industry Innovation Alliance.

  • The company last week launched a battery swap brand called Evogo with plans to establish swap stations in 10 Chinese cities competing against existing players including Nio. It is also developing its next-generation sodium-ion battery, with aims to begin mass production in 2023, Reuters reported.

READ MORE: Chinese EV makers may face a price war in 2022: UBS

Jill Shen

Jill Shen is Shanghai-based technology reporter. She covers Chinese mobility, autonomous vehicles, and electric cars. Connect with her via e-mail: jill.shen@technode.com or Twitter: @yushan_shen