NIO and CATL Strengthen EV Battery Ties Amid China Price War

Chinese electric vehicle (EV) battery giant Contemporary Amperex Technology Co., Ltd. (“CATL”) and premium EV maker NIO Inc. NIO have entered into a long-term strategic partnership under a new five-year agreement focused on advanced long-life battery technologies.

As first announced in 2024, the two companies will jointly develop batteries with extended lifespans, reinforcing their shared commitment toward innovation and ecosystem development in the new energy vehicle (NEV) sector. Long-lasting batteries are expected to reduce ownership costs for customers while improving durability — a factor that will attract buyers.

Beyond battery development, NIO has collaborated with CATL on the development of battery swap technology, which allows EV owners to replace a low battery with a fully charged one in less than 100 seconds.

Under a five-year agreement, the companies will co-develop new technologies, strengthen battery-system compatibility, optimize resource sharing, and scale battery swap services across domestic and international markets.

The collaboration is aimed at building a more open and scalable battery swap ecosystem, enabling broader access for users and potentially other automakers over time. It could also help address the industry’s key problem — high battery replacement costs. Managing used batteries is critical in the EV space, as battery deterioration and replacement expenses could hurt the EV industry, where many companies are already struggling to stay afloat amid cutthroat competition.

China is the world’s largest automotive and EV market, with its electric carmakers at the forefront of EV technology and production. However, too many factories and a savage price war are expected to force many companies out of the market over the next five years.

CATL remains the dominant player in the global EV battery space, holding a 38% share last year. Its 1 gigawatt-hour of battery capacity can power up to 20,000 EVs, each with a range of about 500 kilometers.

CATL, whose major clients are Tesla, BMW and Volkswagen, has been expanding into other areas of electrification. The company began developing marine battery applications in 2017 and has since provided batteries to around 900 river vessels.

Nio deliveries hit a record 48,135 vehicles handed to the customers in December 2025, up 54.6% year over year. In the last three months of 2025, 124,807 vehicles were delivered, increasing at a rate of 71.7% year over year while 326,028 vehicles were delivered in 2025, up 46.9% year over year. Cumulative deliveries reached 997,592 as of Dec. 31, 2025.

NIO Inc. Price, Consensus and EPS Surprise

NIO Inc. price-consensus-eps-surprise-chart | NIO Inc. Quote

Zacks Rank & Key Picks

NIO currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the auto space are Mazda Motor (MZDAY), Subaru Corporation (FUJHY) and Suzuki Motor (SZKMY), each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for MZDAY’s fiscal 2026 and 2027 EPS has improved 3 cents and 21 cents, respectively, in the past 60 days.

The Zacks Consensus Estimate for FUJHY’s fiscal 2026 and 2027 EPS has improved 6 cents and 2 cents, respectively, in the past 60 days.

The Zacks Consensus Estimate for SZKMY’s fiscal 2026 sales indicates year-over-year growth of 3.8%. The Zacks Consensus Estimate for SZKMY’s fiscal 2026 and 2027 EPS has improved 35 cents and 21 cents, respectively, in the past 60 days.

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This article originally published on Zacks Investment Research (zacks.com).

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