Europe has become the most critical arena for the global power battery industry.
In the first half of 2025， nearly 90% of the 1.99 million new energy vehicle (NEV) sales globally were contributed by China and Europe. However， a significant divergence is apparent: China’s market penetration has soared to 44%， while Europe remains around 18%. This nearly threefold gap is primarily hindered not by policy， but by the deeply ingrained concerns of European consumers. A June survey by Shell revealed that despite increasing NEV sales in Europe， interest from internal combustion engine (ICE) vehicle users in NEVs has declined from 48% in 2024 to 41%.
This “decrease rather than increase” phenomenon is attributed to several challenges that were also encountered in the Chinese market but with higher demands:
Range Anxiety: For Europeans who view cars as essential necessities， insufficient range is a critical drawback.
Cold Weather Performance Degradation: Europe’s cold winters present a rigorous test for battery performance.
Long-Term Value Perspective: Unlike Chinese consumption habits， Europeans consider cars as long-term assets， making them particularly sensitive to battery safety and longevity.
These anxieties， rooted in usage habits， combined with tariff-induced price barriers， collectively form a formidable hurdle for the European NEV market. To conquer this continent， Chinese companies have no alternative but to leverage their most advanced technologies and respond with irrefutable product capabilities.
Consequently， in Munich， CATL has presented Europe with a potent solution – the “Shenxing Pro，” a comprehensive and highly safe LFP (lithium iron phosphate) power battery solution， arguably the most advanced available today.
Unleashing a Technological Masterstroke
The “Shenxing Pro” solution features a special “W” shaped battery cell structure， with electrodes and pressure relief valves positioned centrally and recessed.
This technological “masterstroke” refers to CATL’s “Shenxing Pro” equipped with the new “NP 3.0” battery safety technology. Building upon the industry-leading performance of its current LFP products， CATL has significantly enhanced safety features， providing three official safety commitments. These commitments address critical concerns for European consumers:
High Voltage， No Power Loss， No Vehicle Control Loss: In the event of a thermal runaway during high-speed driving， the vehicle will not instantly lose power or control. Instead， it can maintain continuous power supply for over an hour， ensuring passenger safety.
No Power Degradation， No Speed Reduction: During a fault， vehicle performance is not impacted， and speed remains unaffected， allowing drivers ample time for a calm response and safe evasion.
No Open Flames， No Smoke， Eliminating Secondary Damage: The entire process is free from open flames and dense smoke， thereby preventing further secondary hazards.
These advancements signify a transformation where battery thermal runaway shifts from a disaster requiring immediate evacuation to a “check engine light” scenario – a fault that can be addressed later. Based on the limited official information released by CATL， the improved safety capabilities stem from significant reconfigurations in the battery’s electrochemical system and system-level design.
While dramatically enhancing safety， the “Shenxing Pro” solution， featuring “NP 3.0” for the first time， also boasts robust fundamental performance. CATL claims a nominal lifespan of 12 years or 1 million kilometers when charged at a 1C rate (which translates to approximately 120 kW charging speed for a full charge in one hour).
CATL’s deployment of this powerful solution aims to secure a leading position in the fiercely competitive European LFP market.
Is LFP the “Sharp Blade” for Chinese Battery Companies?
In the Chinese market， over just a few years， LFP batteries have captured an 81.4% market share， driven by their absolute advantages in cost， safety， and longevity， coupled with continuous improvements in energy density， fast charging， and cold-weather performance. Now， this “sharp blade，” validated by massive adoption in China， is poised to enter a European market with a significant “strategic vacuum.” Due to climatic conditions and early technological route choices， Europe’s LFP market share is just over 10%， representing a nearly untapped opportunity. Whoever plants their flag first in this segment will likely gain a pivotal advantage in reshaping Europe’s power battery landscape.
It is important to note that competitors with keen market foresight have already taken notice.
The European Power Battery Competition Landscape is Far More Complex Than Domestically
In March this year， reports indicated that South Korean battery giant LG Energy Solution planned to integrate core teams from Chinese battery firm EVE Energy， totaling 200 personnel across critical functions including R&D， production， and sales. An initial R&D team of about 20 members has already joined LG Energy Solution’s Nanjing factory to work on LFP battery development， with subsequent personnel joining throughout the year. In June， Samsung SDI reached an agreement with General Motors to introduce LFP production lines at their joint venture factory in Indiana by 2027. At the end of July， Reuters reported that LG Energy Solution had signed a battery supply agreement worth US$4.3 billion (approximately RMB 30.32 billion) with Tesla for its energy storage systems， utilizing its independently developed pouch-type LFP batteries.
Currently， Europe’s largest power battery factory is LG Energy Solution’s facility in Poland， with an official production capacity of 86 GWh. Other Japanese and South Korean battery manufacturers like SK On， Samsung SDI， and Panasonic also possess significant production capabilities. Notably， SK On has already announced plans to invest €1.9 billion to establish a third factory.
While Northvolt， once hailed as Europe’s “battery hope，” filed for bankruptcy late last year， exposing Europe’s technological gap in batteries， several domestic European power battery players are still actively developing. These include ACC and Blue Solutions， as well as Volkswagen’s own PowerCo. Although these companies have a later start， they are highly likely to receive preferential treatment from EU policies， posing increasing challenges to Chinese battery companies in the coming years. Some EU internal research bodies have even been reportedly inspired by former US President Trump’s policies， attempting to reform taxation to level the price difference for power batteries imported from China.
Despite numerous contenders， CATL currently maintains a leading edge.
Although Chinese automotive brands are still outside the top ten in European sales rankings， CATL’s batteries power almost all cars from European manufacturers familiar to consumers， such as Tesla， Volkswagen， BMW， and Mercedes-Benz. In the first half of 2025， CATL achieved revenues of 61.2 billion yuan， with overseas revenue growth accounting for nearly 90% of its overall business expansion.
In May of this year， CATL completed its secondary listing on the Hong Kong Stock Exchange， with the primary objective of paving the way for capital and providing financial support for overseas markets. The HK$40.6 billion raised through this listing， equivalent to approximately RMB 37 billion， will be allocated 90% to the construction of the first and second phases of its Hungarian factory. This strategic move directly targets the vast European market， projected to exceed 1，000 GWh (for both power and energy storage， according to CATL’s official forecast) by 2030.
Concluding Thoughts
With a decade of forward-looking strategic planning and billions in R&D investment， Chinese companies have undeniably gained a first-mover advantage in the “first half” of the power battery era. However， this is far from the final outcome. The LFP “pursuit battle” initiated by Japanese and South Korean companies is already underway， and the future “beachhead assault” for solid-state batteries is brewing with hidden currents.
Confrontation is not the entire story.
Late last year， Stellantis Group and CATL announced a joint venture valued at €4.1 billion to build a new large-scale battery factory in Spain. Some global automotive giants have recognized that rather than erecting barriers and engaging in futile competition， it is more beneficial to collaborate deeply with leading players.
For CATL， this may represent the ideal path forward: transitioning from simple product export to the global dissemination of technology， standards， and ecosystems. This approach not only translates technological advantages into more sustainable business profits but also， on a global scale， creates an unprecedented and deep binding between “Chinese Batteries” and the future of the world’s automotive industry.
