The call to reduce dependence on CATL is growing louder. CATL reported a net profit attributable to shareholders of 43.284 billion yuan in the first half of 2026, with average daily earnings of nearly 240 million yuan. During the same period, the average profit margin in China's vehicle manufacturing sector fell to 1.5%, hitting a ten-year low. A single battery supplier is earning more than most automakers combined, painting the most realistic picture of profit distribution within China's new energy vehicle supply chain.

First, let's examine CATL's performance report. For the full year of 2025, CATL achieved revenue of 423.7 billion yuan and a net profit attributable to shareholders of 72.2 billion yuan, up 42.28% year-on-year, earning approximately 2 billion yuan per day. Entering 2026, growth has accelerated. First-quarter net profit reached 20.7 billion yuan, up nearly 50% year-on-year. The semi-annual report data is even more striking. In the first half of 2026, CATL's net profit attributable to shareholders was 43.284 billion yuan, a year-on-year increase of 41.98%, translating to nearly 240 million yuan in daily net profit.

Now, looking at the automakers' side. The combined net profit of five major car companies — BYD, Geely, SAIC, Great Wall, and Changan — reached 73.5 billion yuan in 2025, barely matching CATL's figures. However, the issue lies in the fact that these five automakers sold over ten million vehicles, while CATL only manufactures batteries. The gap in net profit margins is even more glaring. The overall net profit margin of 12 major passenger vehicle listed companies stood at just 1.92% in 2025, whereas CATL's net profit margin was as high as 17.04% during the same period — a difference of nearly nine times. A few years ago, former GAC Group chairman Zeng Qinghong famously remarked: "If the battery accounts for 60% of my car's cost, then aren't I just working for CATL?" This statement remains relevant today.

To avoid being subservient, automakers must take matters into their own hands. In September 2026, Li Auto's actions were the most aggressive. Starting September 7, new orders for the Li MEGA switched to its self-developed 5C battery. The Li i9, launched on September 16, initially uses CATL batteries for the first batch of deliveries, but will fully transition to its self-developed batteries once production capacity ramps up. The i6, set to launch in Q4, will not have a CATL version at all. Earlier, the new Li L8 had already switched all its cells to EVE Energy, removing CATL from its supply chain. Li Auto is not alone in this endeavor. In early September, Li Auto invested 2.65 billion yuan to increase its stake in EVE Energy's power battery unit, becoming its second-largest shareholder and deeply embedding itself in battery production capacity. Xiaomi's new model has abandoned the CATL solution, opting for its independently designed Dragon Armor battery system, with cells supplied jointly by CALB and EVE Energy. XPeng's CEO He Xiaopeng publicly stated: "Starting this year, XPeng will shift all its technology development in the power battery sector to self-initiated and self-led efforts." Leapmotor has gone further, announcing 100% self-research and self-manufacturing of its cells, unveiling three standardized cell products at once. Traditional automakers like GAC, Dongfeng, and Geely are also keeping pace. GAC's Inpai Battery has commenced production, while Geely has been investing in battery self-research for some time. Seres has added Gotion High-tech as a supplier, and XPeng has introduced EVE Energy as a collaborator.

Automakers are taking different paths. Some are introducing second and third suppliers, some are acquiring stakes in battery companies, and others are pursuing full-stack self-development. But the goal is the same: to reduce sole reliance on CATL and reclaim pricing power and definition rights in the battery segment. "When a supplier enjoys such high gross margins, you inevitably consider whether you can squeeze out some of that margin for yourself," noted industry analyst Qiu Kaijun, succinctly capturing the sentiment.

The capital markets have already reacted. On September 16, CATL's A-share price briefly fell below 300 yuan, hitting a one-year low. As of September 17, its A-shares had dropped nearly 33% from May's historical high, while H-shares fell nearly 35%, erasing over 700 billion yuan in market value. In contrast, the stock prices of second-tier battery companies like EVE Energy have risen noticeably. However, fluctuations in stock prices do not necessarily equate to a loss of market share. From the data, CATL remains the undisputed leader. In Q1 2026, its domestic market share exceeded 47%. From January to May, its global market share was 40.2%, up 2.2 percentage points year-on-year. In the first half of the year, its global installed capacity reached 242.7 GWh, 2.8 times that of its second-ranked competitor, securing the top spot globally for nine consecutive years. CATL's Chief Manufacturing Officer Ni Jun responded directly: "Being able to build cars doesn't mean you can build batteries. Specialized tasks should be left to professionals."

From a practical standpoint, the move away from CATL is not an all-or-nothing approach. Most automakers are adopting a gradient strategy based on vehicle models and phases. In the mid-to-high-end market (above 200,000 yuan), CATL's share exceeds 60%, with Seres, Li Auto, BMW, and Xiaomi among its major clients. In the ternary lithium battery sector, CATL holds a commanding 75.2% market share. The real impact of reducing reliance is concentrated in the mid-to-low-end market. For models priced under 100,000 yuan, CATL's share has fallen to just 22%. Popular small cars like Geely Star Wish, BYD Seagull, and Wuling Bingo are all equipped with batteries from SVOLT, FinDreams Battery, and Gotion High-tech. Behind these second-tier battery manufacturers lies significant capital backing from automakers.

One detail warrants attention. In September 2026, Geely sold its under-construction battery plant in Chongqing Yaoning to CATL, receiving approval from relevant authorities. While automakers are moving to reduce reliance on CATL, one automaker is simultaneously selling a battery plant to CATL. What does this indicate? Battery manufacturing is not a simple endeavor. Large-scale capacity, yield control, technological iteration, and supply chain management — each requires long-term accumulation. Although second-tier battery makers offer lower prices, they struggle to fully substitute CATL in the short term when it comes to high-end fast-charging batteries and overseas market support. Yet, automakers' demands will not disappear. As long as battery costs remain high and the profit distribution structure remains unchanged, the drive to reduce reliance on CATL will persist. Industry analyst Wu Xiaobo's viewpoint is worth considering: power within the supply chain will not remain permanently fixed with one party. CATL must shift from controlling product supply to coexisting symbiotically with downstream automakers. The "battery king" earning 240 million yuan daily remains formidable, but automakers are no longer willing to remain mere spectators. In the second half of the battery war, the contest is not about who runs faster, but who can find a new equilibrium in this power struggle over profit distribution.

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