As the undisputed leader in power batteries, Contemporary Amperex Technology Co., Limited (300750.SZ) saw its market capitalization approach a staggering 2.2 trillion yuan peak back in May. However, this prosperity proved fleeting, as the company entered a downward trajectory shortly thereafter, with the past month witnessing particularly sharp declines.

Today, its A-shares plunged over 4% to 302.2 yuan, marking a new low since September 2025 and representing a 35% correction from May's high of 467.06 yuan. Simultaneously, its H-shares dropped 5% to 490.2 Hong Kong dollars, hitting a low not seen since March and correcting 38% from June's peak of 792.548 Hong Kong dollars.

So, what's happening with CATL? Let's first examine the news flow. The market has been rife with reports that premium automakers are revising their supplier lists. Li Auto, for instance, has shifted some models to Sunwoda and its own in-house battery development. The all-new Li L8, slated for a June 2026 launch, will have its entire battery supply handled by Sunwoda, effectively ending CATL's involvement in that model line. Li Auto has stated that due to unexpectedly high orders for the new Li MEGA, CATL's 5C ternary lithium battery reserves are nearly depleted, prompting a switch to its own self-developed 5C batteries, with deliveries expected to commence in November.

Similarly, Xiaomi Auto's newly launched Pengcheng N70 and N90 models have not adopted the CATL batteries used in the SU7 and YU7, instead opting for Xiaomi's Longjia battery system, with cells supplied by CALB and Sunwoda. Other mainstream new energy vehicle manufacturers, including Harmony Intelligent Mobility Alliance, XPeng, and Leapmotor, are also expanding their battery supplier rosters, moving away from relying solely on CATL.

According to third-party installation data estimates, Li Auto and Xiaomi together account for approximately 13.6% of CATL's domestic installations, representing a notable loss in the premium vehicle segment. The question arises: why are automakers pursuing this "de-CATL" strategy? The reasons are straightforward, driven primarily by profit pressures. Power batteries constitute 30% to 40% of a vehicle's total BOM cost, making them the most expensive component.

CATL generated 43.28 billion yuan in net profit during the first half of the year, while 15 major listed automakers combined posted a net profit attributable to shareholders of only 21.05 billion yuan—less than half of CATL's. As automakers face mounting profitability challenges while battery manufacturers thrive, this distribution model proves unsustainable. CATL's near-monopoly previously left automakers in a precarious position of dependence and apprehension. To break free from single-supplier constraints, automakers are proactively restructuring through "self-developed batteries plus multiple second-tier suppliers" to weaken CATL's pricing power.

Furthermore, driving range, fast-charging capabilities, safety, and low-temperature performance have long been core selling points for new energy vehicles. If battery solutions remain entirely in the hands of suppliers, automakers' technological competitiveness lacks a critical foundation. Li Auto's approach exemplifies a new supply chain model: automakers define performance standards, design battery systems, and control software and pack integration, while cell manufacturers handle production.

More importantly, power batteries are not an insurmountable barrier. Although CATL retains advantages in R&D, technology, production capacity, and supply chain, other manufacturers have narrowed the gap through years of pursuit and achieved commercial viability. Some second-tier suppliers already supply major automakers, including first-tier clients like Li Auto and Xiaomi. These developments fuel market concerns. Despite CATL's half-year net profit still recording over 40% high growth, downstream automakers' multi-supplier strategies will erode CATL's domestic premium market share, forcing its valuation logic to shift from "high-growth tech stock" to "traditional cyclical manufacturing stock"—an inevitable repricing.

A deeper concern lies in the electric vehicle consumer market itself. The fundamental issue is that EV penetration has reached relatively high levels, and combined with domestic consumption downgrading, growth is leveling off. Unless overseas markets achieve significant breakthroughs, supply-demand imbalances will intensify, leaving automakers with price cuts to drive sales volumes—resulting in impressive numbers but compromised profitability. These issues ultimately manifest as negative factors affecting vehicle prices and automaker profits, dragging down valuations across the entire industry chain. CATL, holding a higher position in the chain, merely experiences delayed negative effects.

Currently, CATL's trailing twelve-month P/E ratio stands at just 13 times, already at multi-year lows. Technical rebounds or sudden positive catalysts remain possible, but over the long term, valuation suppression factors appear unlikely to ease significantly, suggesting the current valuation may not yet represent a bargain.