The Battery Empire

The global market for electric-vehicle batteries has a centre of gravity, and it sits in two Chinese cities. In 2024 the world installed about 894 gigawatt-hours of EV batteries, up 27% on the year, and a single company, CATL, of Ningde, supplied 37.9% of it, the only maker above 30%. BYD, of Shenzhen, added another 17.2%.^[1] Between them, two firms accounted for 55% of every battery that went into an electric car on earth.

Widen the lens to all Chinese manufacturers, CATL, BYD, CALB, Gotion, EVE, Sunwoda and the rest, and the combined share reaches roughly two-thirds of the global market.^[1] The concentration has, if anything, hardened: through the first eleven months of 2025 CATL held 38.2% and BYD 16.7%, so the leadership is not a cyclical spike but a settled structure.^[2]

The moat is the price

What underwrites the empire is cost. BloombergNEF’s 2025 survey put the volume-weighted average battery pack at $108 per kilowatt-hour, but the average hides a geography. A pack in China cost about $84/kWh; in North America $121, some 44% more; in Europe $131, 56% more.^[3] The chemistry tells the same story: lithium iron phosphate (LFP) packs averaged $81/kWh against $128 for the nickel-based NMC that Western makers long favoured.^[3] China industrialised the cheaper chemistry first and at scale, and now the rest of the industry is following it back down the cost curve.

A battery pack costs $84 a kilowatt-hour in China and $131 in Europe. That 56% gap is the empire, priced.

One honest distinction matters for reading the numbers. The shares above, from SNE Research, measure batteries deployed in vehicles actually sold; on a manufacturing-capacity basis China’s share runs higher still. The 55% figure is the top two firms; the two-thirds figure is the whole Chinese field. Confusing the two is the most common error in the coverage.

Our take

The battery is the single most valuable component of an electric vehicle, and its supply is more concentrated than the oil market ever was. For a Western carmaker that is a strategic dependency dressed as a procurement line; for an investor it frames the real questions. Who can localise cells outside China at a cost that survives contact with an $84 pack — and on what subsidy? Which materials and equipment upstream of the cell are harder to localise than the cell itself? We treat CATL and BYD less as stocks to trade than as the fixed point the entire electrification map is drawn around.