SHANGHAI — CATL, the world's largest electric vehicle battery manufacturer, reported a 24 percent drop in first-quarter profit on Friday, the supplier's first decline in two years, as it battles soaring raw material costs and a resurgence of COVID-19 in China.
CATL, whose customers include Tesla, Volkswagen Group and BMW Group, booked a net profit of 1.49 billion yuan ($226.69 million), a filing on the Shenzhen Stock Exchange showed.
That was down from 1.95 billion yuan profit a year earlier despite revenue rising sharply to 48.68 billion yuan from 19.17 billion yuan a year earlier.
Prices of key metals such as lithium nearly doubled in the first three months, weighing on CATL's profit margins and prompting it to raise battery prices in March.
Other battery makers have also reported lower earnings for the latest quarter, hit by rising raw material costs and supply chain disruptions. South Korea's LG Energy Solution reported a 24 precent quarterly profit drop earlier this week.
Like its rivals, CATL is ramping up production and mineral sourcing to meet growing demand for EVs.
It said earlier this month it had secured exploration rights for a lithium clay deposit in the central province of Jiangxi in China and set up a joint venture in Indonesia for nickel mining.
Consultant Wood Mackenzie says CATL is on track to more than triple its cell manufacturing capacity by 2025.