China's EV Battery Industry Expands with Local Zone Support and New Recycling Rules

Local governments in China have been crucial to the rise of CATL, the world’s leading electric‑vehicle battery maker. In Fujian’s Dongqiao Economic and Technological Development Zone, preferential land, tax incentives and streamlined approvals attracted CATL and a dense network of suppliers, research institutes and skilled workers. By the end of 2025, the zone will host over 90 upstream and downstream firms, with CATL’s Dongqiao plants providing about 330 GWh of capacity and another 170 GWh under construction, turning the area into a global battery cluster.

At the same time, China has introduced new regulations that prioritize shredding used EV batteries to recover lithium, nickel and cobalt, effective 1 April. The rules shift focus away from second‑life reuse, which the United States and Europe continue to promote. The policy difference reflects each side’s approach to securing critical metals: China aims for large‑scale metal recovery, while the West seeks to extend battery life before recycling.