The largest battery manufacturer CATL came under sanctions from the US Department of Defense

The Pentagon said the company is collaborating with the Chinese military, which means interaction with CATL could pose a threat to national security. So far, the US authorities have not mentioned specific restrictions for CATL, but there are already reputational costs: the shares of the Chinese company immediately fell by five percent. The battery manufacturer does not agree with the accusations.

In an official statement, CATL calls the actions of the US Department of Defense erroneous and emphasizes that they were never associated with military business. For a Chinese corporation, inclusion in the Pentagon’s blacklist does not bode well: a warning from the US authorities could jeopardize joint projects with American partners.

Battery giant CATL unveils safe platform for electric vehicles New CATL batteries will make electric airliners a reality CATL unveils LFP battery with ultra-fast charging

Reuters analysts believe that the Pentagon is de facto introducing restrictions on cooperation in certain sectors of the economy. American legislators have long sought to include CATL in the blacklist, since Ford planned to buy a license from the Chinese side to produce inexpensive lithium-ion cells. Now the joint project with an expected investment of $3.5 billion is in doubt.

CATL cells are not currently available in the US, but Tesla uses these batteries in Chinese-made electric vehicles. Elon Musk’s company also planned to use the battery giant’s technology in American Gigafactories, but now the partnership will probably be approached with caution.

Next train: new “battery-powered” products