CATL's battery capacity utilization rate reached 95 percent in 2021, but fell to 60.50 percent in the first half of this year.
Concerns about power battery overcapacity have surfaced from time to time this year as growth in China's new energy vehicle (NEV) industry slows.
Chinese power battery giant CATL has cut workers' hours because of a lack of enough orders for production, according to a report in local media China Entrepreneur today.
At one of CATL's production sites in Sichuan, southwestern China, some workers in the first half of this year were restricted to eight hours of work, down from 11 hours a day in the past, and night shifts were cut back, according to the report.
The biggest impact on workers has been a reduction in income, with one employee named Wang Peng (a pseudonym) saying his monthly salary this year has averaged between 1,000 yuan ($140) and 2,000 yuan less than last year.
In June-July 2022, when the production site was busy, the average worker would get about RMB 7,000 to RMB 8,000 a month, Wang said.
This situation is not just at the Sichuan base, according to the report.
The head of a human resources service company in Henan said they have not provided workers to CATL's battery production base in Liyang, Jiangsu province, in the last year, according to the report.
Under normal circumstances, the HR firm would provide workers to the plant twice a year, the report said.
Her clients also include CALB, Svolt Energy, who also faced a shortage of orders in the first half of the year, thus seeing a large number of employees leaving, the person said.
CATL's power battery capacity has grown 7.4-fold in the past three years, as the rapid growth of China's NEV industry has triggered high demand for batteries.
CATL's annual power battery capacity was 53 GWh in 2019, with the figure reaching 390 GWh by 2022.
As of now, CATL has 13 power battery production sites around the world, including 11 in China and two overseas.
CATL's battery capacity utilization rate reached 95 percent in 2021, the highest in recent years, its past financial reports show.
After that, the company's capacity utilization rate slipped, falling to 60.50 percent in the first half of this year, according to the company's semi-annual report released on July 25.
In a conference call after announcing its first-half results last month, CATL blamed the slump in capacity utilization on the industry's slow season.
The first half of the year was traditionally a slow season for the industry, and the company's capacity utilization will gradually increase in the second half of the year as market demand grows, CATL said.
Notably, in the first half of 2022, CATL's battery capacity utilization rate was 81.25 percent.
In the first half of last year, China's retail sales of NEVs rose 121.87 percent year-on-year to 2.24 million units. And in the first half of this year, China's NEV retail sales grew only 37.58 percent year-on-year, according to China Passenger Car Association (CPCA).
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