China's CATL, the world's largest EV battery maker, is reportedly in advanced talks to pick a site for its first electric vehicle battery plant in the United States.

The company is in the final stages of vetting US sites, two people familiar with the plans told Reuters. The sources said CATL is in talks to open plants that would serve BMW Group and Ford Motor Company, with potential sites including South Carolina and Kentucky, where the automakers have assembly plants.

The goal for the potential South Carolina plant would be to start battery production in 2026, one of the sources said. BMW is already a customer of CATL. 

While CATL declined to comment on the report, its chairman Zeng Yuqun said last week the company was looking at options to localize production for overseas automakers in their own countries.

CATL new battery cell plant in Thuringia, Germany
CATL new battery cell plant in Thuringia, Germany

He added that CATL had begun mass production of batteries for overseas markets in 2021 and was looking to consolidate its position as the major battery supplier to overseas automakers "in the next round of supplier sourcing," which would begin from 2026.

Contemporary Amperex Technology Co (CATL) is increasing production and the sourcing of minerals to meet growing demand for electric vehicles. According to Consulting firm Wood Mackenzie, the battery maker looks set to more than triple its cell manufacturing capacity by 2025.

The report on CATL's planned battery factory in the US comes as the United States government is encouraging EV investments and other Asian battery makers are announcing plans to build factories in the country—including Korea's LG Energy Solution, SK Innovation, and Samsung SDI.

Last week, the White House said it would allocate more than $3 billion in infrastructure funding for EV battery manufacturing, with President Joe Biden saying he wants half of vehicles sold in the US to be electric by 2030. 

CATL's first battery plant outside China will open open later this year in Arnstadt, Germany, to serve BMW and other automakers. CATL will invest €1.8 billion ($1.89 billion) in the factory, which will have an initial annual capacity of 8 gigawatt-hours of batteries, with plans to increase it to 14 GWh over time.

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