Profit Falls At World’s Largest EV Battery Maker CATL Even As Sales Soar 136% In First Quarter

Rising global demand for electric vehicles didn’t translate into higher profit in the first quarter for the world’s largest supplier of batteries for those cars, according to a stock filing on Friday.

Net profit in the first three months at Contemporary Advanced Technology, or CATL, fell by 23.6% from a year earlier to 149.2 million yuan, or $23 million. The Ningde, China-headquartered company customers include Tesla, BMW, Geely Auto and Volkswagen.

Buoyant demand was apparent in the 153% year-on-year surge in first-quarter sales to 4.87 billion yuan. Profit was hurt by higher costs, CATL said. Higher global prices for EV material lithium even led Tesla CEO Elon Musk to tweet on April 8: “Price of lithium has gone to insane levels! Tesla might actually have to get into the mining & refining directly at scale, unless costs improve.”

CATL’s Shenzhen-traded shares have plunged 40% since from a recent high of 688 yuan in December, closing at 409.35 yuan on Friday.

Despite the recent slump, the 25% jump in the company’s Shenzhen-traded shares from a year earlier has helped CEO Chairman Robin Zeng build a fortune worth $37.5 billion on the Forbes Real-Time Billionaires List today.

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