Tesla Battery Supplier CATL's Stock Tumbles As Profit Falls 24% On High Raw Material Costs

Contemporary Amperex Technology Co, Ltd’s (CATL) shares plunged 12% in early trading on Thursday on the Shenzhen Stock Exchange, CnEVpost reported on Thursday.

What Happened: CATL, which supplies batteries to Tesla Inc TSLA and Xpeng Inc XPEV, last week posted a significant drop in quarterly earnings due to higher input costs.

China markets resumed trading on Thursday after a five-day holiday to mark labor day. 

CATL’s first-quarter net income fell 24% to $225 million for the three months ended March 31, 

It had previously postponed the announcement of its first-quarter financials by a few days. 

The battery maker said it is struggling with higher input costs.

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Why It Matters: CATL has the most dominant position among global battery makers, with about a 35% global market share. Rocketing raw material prices for nickel and lithium, the key ingredients used in EV batteries, have hit suppliers and EV makers hard.

CATL counts Tesla as one of its largest customers. 

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Photo courtesy: CATL