CATL Doubles Down on Energy Storage With Output Boost in Western China
Contemporary Amperex Technology is accelerating the expansion of its energy storage capacity in western China, breaking ground on the second phase of its Chengdu facility to meet surging global demand for grid-stabilization technology.
The battery giant’s subsidiary, Chengdu Xinjin Contemporary Amperex Technology, has commenced construction on the project’s second phase, with 15% of the work already completed as of late March 2026. The aggressive timeline targets a production launch by July 2026, a move designed to double the subsidiary's annual output value to approximately RMB 9 billion (US$1.3 billion).
This expansion comes as the facility hit a ceiling on its existing capabilities. According to operational data released this week, the Xinjin plant achieved a 100% capacity utilization rate throughout 2025. Industrial output for the full year climbed 14% year-on-year to RMB 4.03 billion (US$584 million), underscoring the resilience of the energy storage sector even as the broader EV battery market normalizes.
Driving Output to $1.3 Billion
The Phase II project represents a strategic pivot toward high-density manufacturing. Upon completion, the expansion is projected to add RMB 5 billion (US$725 million) in annual production value. The facility will focus specifically on energy storage cells (ESS) and system integration, critical components for renewable energy grids in markets ranging from Australia to Germany.
Construction crews have entered the final stages of piling for the outdoor single structures. The core cell manufacturing plant is scheduled for phased delivery starting April 5, 2026, allowing for immediate equipment installation. The project is expected to create over 1,000 new jobs, effectively doubling the tax revenue contribution of the local entity.
Leveraging Zero-Carbon Credentials
The expansion reinforces CATL’s strategy to secure its position in environmentally sensitive export markets like the European Union. The Xinjin facility was designated as a "Zero Carbon Factory" in August 2023, obtaining PAS2060 carbon neutrality certification from SGS. This certification is increasingly vital for supply chain compliance in the UK and Germany, two of the plant's key export destinations alongside the US and South Korea.
Operational efficiency metrics at the plant currently rank among the highest within the CATL group. By scaling up a certified zero-carbon facility, CATL aims to mitigate potential regulatory friction in Western markets regarding the carbon footprint of imported battery systems.
Consolidating the Western Hub
Since signing the investment agreement in February 2021 and commencing production in October of that same year, the Xinjin base has become a linchpin in CATL's southwestern supply chain. The rapid deployment of Phase II—supported by local stakeholders including the Xinjin Economic Development Zone and State Grid—signals a continued shift of high-end manufacturing capacity to China's interior provinces.
With the combined output of Phase I and II expected to exceed RMB 9 billion, the subsidiary is positioning itself as a primary global hub for ESS production, differentiating its portfolio from the company's automotive battery divisions.
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