Mega-Investment in Spain: CATL and Stellantis Break Ground on €4.1 Billion Battery Gigafactory
The race to electrify Europe just hit a major new gear, as Chinese battery titan Contemporary Amperex Technology Co. Limited (CATL) and auto giant Stellantis officially launched construction on their massive new battery plant in Spain. Representing a staggering investment of up to €4.1 billion, this joint venture is a powerhouse project set to dramatically reshape the European electric vehicle supply chain.
Located in Zaragoza, specifically the Stellantis site in Figueruelas, the facility is being hailed as one of Europe’s most significant battery investments to date. The partnership is a 50-50 joint venture, which the two companies are banking on to secure their positions in the continent’s burgeoning EV market.
Powering Affordable EVs
So, what makes this factory so important? It’s all about the battery chemistry. The new gigafactory will focus on producing Lithium Iron Phosphate (LFP) cells and modules. LFP technology is generally known for being more cost-effective and having a longer lifespan than the Nickel Manganese Cobalt (NMC) batteries often used in premium vehicles.
This focus aligns perfectly with Stellantis’ strategy to deliver more affordable electric passenger cars, crossovers, and SUVs in the B and C segments. Simply put, this new Spanish capacity is designed to make mainstream electric mobility accessible to more European drivers, feeding directly into the production lines of brands like Peugeot, Fiat, and Opel.
When fully operational, the plant is projected to reach an annual capacity of up to 50 gigawatt-hours (GWh). That is enough power to supply batteries for roughly one million electric vehicles every year.
A Strategic Move for Europe
The construction, which is scheduled to conclude with production starting by the end of 2026, is a key win for both Spain and the wider European Union. The project has received support from the EU, including more than €300 million in funding, and is seen as a vital component of Spain’s industrial revitalization efforts.
Spanish government officials have called the facility “the best contribution that Spain can make to the re-industrialisation of Europe.” This sentiment highlights a broader European goal: reducing reliance on external suppliers and building a robust, localized battery value chain. For CATL, the world’s largest EV battery producer, establishing production inside Europe is also a savvy move to navigate the EU’s recent introduction of tariffs on Chinese-built electric cars.
Jobs and Green Tech
The benefits extend beyond supply chain security. The complex is designed to be one of Europe’s first carbon-neutral lithium battery factories, with plans to rely on more than 80 percent renewable energy.
Crucially for the local economy, the project is expected to create over 4,000 direct and thousands of indirect jobs. While the initial construction phase involves a significant international workforce, plans are in place to ultimately hire and train approximately 3,000 Spanish employees for the long-term operations, ensuring a major transfer of advanced manufacturing expertise to the region.
The Zaragoza gigafactory will be CATL’s third European facility, complementing its existing operations in Germany and Hungary, and solidifying its role as a core partner in the continent’s transition to electric power. The massive scale and strategic importance of this Spanish project underscores the global commitment to building a greener automotive future, right in the heart of Europe.
