Volkswagen and Gotion High-tech Negotiate Control of Spanish Battery Plant as Gotion Faces Cash Crunch

Gotion High-tech Chairman Li Zhen has led a team to visit the planned battery factory site in Spain. The facility has a planned annual capacity of 40GWh, expandable to 60GWh. Volkswagen announced a EUR 3 billion investment in 2022, with original production scheduled for September 2026 but delayed to year-end due to supplier and construction issues. Volkswagen's battery subsidiary PowerCo said it has no plan to relinquish control of the factory.

Gotion is under funding pressure. In July, it sold 8.4 million shares of Tongguan Copper Foil for RMB 829 million, equivalent to one-third of Gotion's estimated 2025 net profit attributable to shareholders. Tongguan Copper Foil's share price once hit RMB 202.15 in June, with a maximum year-to-date gain of nearly 400%, but Gotion sold before the peak. First-quarter financial results show Gotion's revenue hit a record RMB 11.71 billion, but net profit attributable to shareholders was only about RMB 21 million, down nearly 80% year-on-year. Net cash outflow from investing activities was RMB 4.657 billion, expanding 425% year-on-year. The company's debt-to-asset ratio stood at 71.97%, with short-term borrowings of RMB 17.99 billion, non-current liabilities due within one year of RMB 10.94 billion, and cash and cash equivalents of RMB 16.71 billion, leaving a static funding gap of about RMB 12.2 billion. A RMB 5 billion private placement launched in February 2026 aims to fill the gap.

In the domestic power battery market, CATL and BYD hold the top two positions. In the first half of 2026, CATL's domestic installed capacity was 156.9GWh, a 45.6% market share, while BYD had 57.4GWh, a 17% share. Rankings from third to tenth have seen frequent changes. For January to May 2026, Gotion's domestic installed capacity was 9.02GWh, a 4.9% share, ranking fifth; CALB had 10.17GWh, a 5.5% share, ranking third; Sunwoda had 6.65GWh, a 3.6% share, ranking seventh. However, data from the China Automotive Power Battery Innovation Alliance shows that for the January-May period, Gotion reached 15.79GWh installed capacity and a 6.10% market share, rising to third place, while CALB slipped to fourth with 15.51GWh and 5.99%, a difference of only 0.28GWh. Gotion has long focused on the lithium iron phosphate (LFP) track, leveraging cost and scale manufacturing advantages, and with core customers such as Leapmotor and Volkswagen Anhui achieving surging sales, its passenger car shipment share has continued to rise.

In 2026, Gotion entered the supply chain for HarmonyOS Smart Mobility's Aito M6.

Gotion has been developing solid-state battery technology for more than eight years. As of February 2026, it had filed over 200 solid-state battery patents, with invention patents accounting for more than 70%. In 2025, it built a 0.2GWh all-solid-state battery pilot line, with 100% domestic core equipment. In 2026, it plans to build a 300-tonne-per-year lithium sulfide capacity and a 2,000-tonne-per-year solid electrolyte capacity, and the design of a 2GWh all-solid-state battery mass production line is largely complete. Overseas revenue accounted for 22.6% of total revenue in 2025. For January to May, global (excluding China) power battery installations reached 7.8GWh, up 128.8% year-on-year, with a 3.7% share, ranking seventh. Gotion shipped about 65GWh in the first half, with a full-year guidance of 150GWh, and capacity at year-end is expected to reach 260GWh.