The author is a Reuters Breakingviews columnist. The opinions expressed are her own.
By Katrina Hamlin
HONG KONG, April 15 (Reuters Breakingviews) - Contemporary Amperex Technology 300750.SZ looks like a Chinese company that may actually benefit from Donald Trump’s tariffs mess. The U.S. president's chaotic trade regime and his administration's lack of support for electrification will give Chinese EV pioneers a strategic edge in Europe.
The $135 billion giant delivered robust results on Monday. Its net profit grew by a third to reach nearly $2 billion, achieving a 16.5% margin – the strongest on record since its 2018 initial public offering, according to Visible Alpha. The group founded by Robin Zeng is on firm ground to maintain that momentum.
Trump’s barrage of new levies, exemptions, reprieves and investigations makes it difficult for global businesses to depend on the U.S. market. Chinese manufacturers face reciprocal tariffs of 145%.
For the electric car and battery industry, the situation is worse because the new administration’s efforts to curb ways to combat climate change, to support fossil fuels, and to reverse vehicle emissions rules set back the American auto industry’s already snail-paced electrification. The U.S. accounted for a tenth of all new battery-electric car registrations in 2024, according to Market Watch. Consequently, it now looks like a poor trading partner for countries and companies keen to scale up a transition to EVs, as well as energy storage solutions.
Policymakers will be more receptive to finding ways to work with Chinese industry leaders such as CATL, BYD 002594.SZ and others instead. The European Union’s Friday announcement that it will liaise with China to explore minimum pricing instead of tariffs for battery-electric vehicles imported into the bloc is an early sign of this shift.
CATL is well positioned to capitalise on warming relations, having recently opened plants in Hungary and Germany. The latter has turned profitable, Jefferies noted on Monday. The group is also building a plant together with Stellantis STLAM.MI in Spain. In January, an executive said it hopes to announce plans for yet another European factory in partnership with an automaker later in the year.
Granted, CATL is not entirely immune from the president's antics. Since unveiling what he calls "Liberation Day" on April 2, the tariffs have wiped around 8% off both the company's Shenzhen-listed shares and Hong Kong's benchmark index. That has undermined CATL's preparations for a secondary listing in the city intended to help fund overseas expansion.
But becoming a more important strategic partner for the EU, the world’s second-largest market for electric cars after China, may end up trumping that.
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CONTEXT NEWS
Contemporary Amperex Technology on April 14 said net profit in the first three months of 2025 grew 32.9% to 14 billion yuan ($1.9 billion) compared to the same period last year. Revenue grew 6.2% to 84.7 billion yuan.
Graphic: CATL's net margin hit a high last quarter https://reut.rs/4jxmqVl
(Editing by Antony Currie and Aditya Srivastav)
((For previous columns by the author, Reuters customers can click on HAMLIN/katrina.hamlin@thomsonreuters.com; Reuters Messaging: katrina.hamlin.thomsonreuters.com@reuters.net))
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