Battery-maker to Billionaire?
An unheard story of rags to riches ft. the stupendous Chinese government, electric automobiles (cough Tesla cough) and a man with a vision.
There goes a saying, “Work hard in silence, let your success make noise.”
Such is the story of an entrepreneur in China, Mr. Zeng Yuqun, whose net worth has grown greater than even Jack Ma's. Starting from a small village in China, with a small salary of $30 a month, the empire that he has built has now become the world’s largest battery-maker.
While Zeng Yuqun might himself prefer working in stealth mode, his customers are the most popular and ubiquitous companies on the face of earth.
Yes! His batteries power almost every major auto brand in the world (including Tesla). But much before that, his company played an integral role in elevating the performance of Apple’s famous iMac.
Zeng Yuqun started his journey with lithium ion batteries way back in 1999. But when he realized how the world (and specially the Chinese Government) was moving towards Electric Vehicles, he jumped on the new wagon. He started another company CATL in 2011 to cater to the EV companies that started mushrooming around. Since then there has been no looking back.
The man himself earned a doctorate in condensed matter physics. The company’s research and development complex is worth around $470 million and employs over 5,000 people, making it a global flagship. And so, just like their customers, this company has also been the front-runner of innovation.
What puts it in a better position than its rivals, in terms of cost, is the kind of support this indigenous company has received from the Chinese government and of course China’s infamous cheap labour. Conducive factors like these allow CATL to have an operating margin of 15%: which is considered best in class.
Result?
CATL’s market valuation is around $200bn, which is more than the valuation of 2nd, 3rd and 4th largest battery producers combined! (South Korea’s LG Chem, Japan’s Panasonic, and China’s BYD). Now, getting the crown is one thing. Not letting it slip is a skill that needs constant growth and expansion.
What can CATL do if it wants to keep growing and retain market share?
It can increase the volume of its productions and move the market closer to its customers. And so, CATL, just like its rivals, is on the path of expanding its footprints across the globe. How?
By setting up factories outside of China.
Can CATL expand its foreign operations and maintain its global supremacy like it did locally?
Fun Fact: CATL runs a dating service in its premises that has eventually led to 52 marriages in a year! Wanna find a life partner? Work at CATL maybe?
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I think it should spread it's branches wider into different products 🤔