In a recent dialogue, the executive editor of a financial magazine engaged in a conversation with Mr. Zeng Yuqun at the headquarters of Contemporary Amperex Technology Co.,Ltd. (CATL).

The discussion began with a question about the most significant decision, in terms of time spent deliberating, that CATL has made over its nearly 15-year history. Mr. Zeng inquired whether the question referred to administrative, technical, personnel, or commercial decisions. Upon clarification that it encompassed all categories, he identified strategic choices regarding technological pathways as the most time-intensive.

He elaborated that the core challenge lies in determining which technological roads to pursue, such as whether to develop sodium-ion batteries or solid-state batteries. These decisions are particularly difficult and agonizing due to the massive investments required.

The Core Philosophy and Expansion Trajectory

CATL is actively transforming from a battery manufacturer into a foundational infrastructure provider for a new energy society. As the world's leading power battery producer, often referred to as the "Battery King," CATL commanded a 39.2% share of the global power battery market in 2025. Its net profit that year reached 72.2 billion yuan, surpassing the combined profits of the top ten Chinese automakers by market capitalization, highlighting a vast profitability gap.

However, what has drawn the most attention recently is not its continued dominance in batteries but its aggressive expansion into new business frontiers. This expansion spans multiple sectors: extending battery applications from passenger vehicles to commercial vehicles like electric heavy-duty trucks, electric ships, and electric aircraft, and building out energy replenishment networks like battery swap stations.

In the power sector, CATL's energy storage battery holds over a 30% global market share, with its system integration business growing 160% in 2025, forming a robust second growth curve. In grid applications, the company is a leader in distributed microgrid development and grid-forming energy storage exploration, while also advancing flexible grid and virtual power plant technologies.

For industrial applications, CATL provides green energy and zero-carbon operation solutions for mining sites, steel plants, cement factories, chemical plants, and industrial parks. To secure its supply chain, it has invested heavily in establishing a resource group while accelerating battery recycling and resource circulation initiatives.

Venturing into AI, CATL has invested over ten billion yuan to become the largest shareholder in veteran data center operator Century互联 and leading power supplier for AI computing centers, Zhongheng Electric, securing its role in the era of computing-power synergy. The company has also signed zero-carbon city strategic cooperation agreements with numerous Chinese cities and is accelerating its global footprint with factories in Germany, Hungary, Spain, and Indonesia, alongside energy storage projects in Australia, the UAE, and Brazil. Its Hong Kong listing in May 2025 provides more flexible capital for overseas expansion.

Chairman Zeng Yuqun stated that CATL is committed to becoming "a zero-carbon technology company that makes outstanding contributions to humanity's new energy cause."

Defining the Business Scope

When asked about the logic behind this broad expansion—from vehicles to AI and robotics—Mr. Zeng explained that all initiatives fall within the company's vision of contributing to new energy. Expansion is based on core competencies and occurs only when CATL can offer something unique or superior. He emphasized that the company avoids areas outside its expertise, such as life sciences, and focuses on adjacent technologies where it can leverage existing strengths. The underlying criteria for entering any new field are a large addressable market, high barriers to entry, and technological adjacency.

Technological Frontiers and the Solid-State Battery Reality

Regarding technology, Mr. Zeng noted that battery technology remains the fundamental focus, alongside significant effort in AI data center (AIDC) energy solutions. He downplayed the near-term potential of solid-state batteries, clarifying that they are not a holy grail. He explained that true solid-state batteries require a fully solid electrolyte under normal conditions, and significant scientific hurdles remain, such as solving solid-solid interface contact issues. He assessed the technology's readiness level (TRL) at only 4 out of 9, far from mass production or commercialization. He believes innovation is event-driven, not time-driven, and that many other avenues for battery improvement exist, such as developing higher-voltage systems.

Sustained Growth Prospects

On the industry's growth cycle, Mr. Zeng argued that the high-growth phase for new energy is far from over. With global electric vehicle penetration around 20% and much lower for trucks, ships, and aircraft, plus burgeoning demand from robotics and the massive need to transform power grids and support AIDC growth, he sees enormous room for expansion, potentially lasting until carbon neutrality around 2060.

Averting the Fate of the Solar Industry

When asked if the power battery industry could suffer the same fate as solar photovoltaics—technologically leading but plagued by losses due to cutthroat competition—Mr. Zeng acknowledged the risk. He attributed the solar industry's problems primarily to insufficient intellectual property (IP) protection, leading to rampant copying and price wars. He stated that CATL itself faces imitators with 60-70% of its performance but lower prices. He emphasized that CATL avoids price wars and instead focuses on IP protection, legal action, and building an ecosystem. The company's battery-as-a-service (BaaS) or "battery leasing only" model is a key strategy, as it requires high-quality, reliable batteries that the company is willing to maintain ownership of throughout their lifecycle.

Transitioning to a Zero-Carbon Tech Company

Explaining the shift from a "battery company" to a "zero-carbon technology company," Mr. Zeng described batteries as just one pillar supporting the "four beams and eight pillars" of a new energy society. The company is building or acquiring capabilities to fill out this structure. He identified energy storage as the key technology for grid flexibility改造, enabling the time-shifting of energy that traditional grids cannot achieve. He discussed CATL's independent microgrid pilot project in Dongying, noting its progress and the larger market potential overseas where electricity prices are higher. The company is also developing software for grid interactions and exploring virtual power plants. He described this long-term, multi-project strategy as "playing chess," requiring early moves, patience, and real-world testing.

Securing Critical Minerals

Addressing concerns about swapping oil dependency for reliance on lithium, cobalt, and nickel, Mr. Zeng argued the comparison is flawed because these minerals are recyclable, unlike fossil fuels. He projected that by around 2042, 50% of mineral needs could be met from recycled batteries. To ensure supply security amid geopolitical volatility, CATL has established its own resource company, focusing on key minerals like lithium, nickel, and cobalt, while still relying on partners—a dual-track approach.

Navigating a Globalized World

On globalization challenges, including technology transfer demands, Mr. Zeng expressed little fear of "teaching apprentices who starve the master," drawing a parallel to Europe's enduring lead in internal combustion engines despite decades of knowledge transfer. He believes maintaining a technological edge through continuous progress is key. While he views global supply chain security concerns as largely unreasonable, he acknowledges the reality and stresses the importance of fostering strong, enduring commercial partnerships, which he sees as more reliable than inter-governmental relations. He discussed adapting his proposed "433" model for sharing benefits among multinational companies, resource countries, and host countries to practical realities, such as local production requirements in Europe.

The Driving Force and Internal Challenges

Mr. Zeng asserted that commercial viability is the core engine for realizing the zero-carbon vision, as profit attracts participants to build the ecosystem. When discussing corporate culture, he contrasted the perceived emphasis on work-life balance in some Western companies with the intense "striving" culture of Silicon Valley, which he sees as an innovation model. He believes that in a fiercely competitive global landscape, relentless effort is essential.

Reflecting on the long-term vision, his greatest concern is internal: organizational capability, talent density, and the team's learning ability and passion. He stressed that a clear understanding of concepts and diligent execution are more critical than grand narratives, with internal factors being far more decisive than external challenges.