CBAK Energy's Q1 2025: Key Contradictions on Production Capacity, Customer Demand, and Expansion Plans

Production capacity and expansion goals, customer demand and tariff concerns, overseas expansion and production capacity, customer demand and orders, capacity expansion plans are the key contradictions discussed in CBAK Energy Technology's latest 2025Q1 earnings call.



Revenue Decline and Product Transition:
- CBAK Energy experienced a year-over-year decline of 41% in net revenues, with the battery business reporting a 54.6% decrease in revenue.
- This was due to the ongoing upgrade of their manufacturing lines from Model 26650 to Model 40135, which is anticipated to regain growth momentum upon completion.

Regional Performance Disparity:
- While the Dalian facility faced a decline, the Nanjing operations maintained strong growth momentum, focusing on the competitive Model 32140.
- This disparity was attributed to Dalian's transition from the outdated Model 26650, while Nanjing continued to produce the flagship Model 32140.

Expansion and Tariff Mitigation:
- CBAK Energy plans to establish an overseas manufacturing facility in Southeast Asia and potentially expand to the United States to mitigate tariff challenges.
- The decision to expand into Southeast Asia is driven by customer demand, with a formal agreement expected to be signed soon.

Potential Recovery and Future Growth:
- The company anticipated a significant recovery beginning next year, driven by the completion of the Dalian upgrade and new manufacturing facilities.
- This recovery is expected to be supported by a large-scale, full-year order from a major customer, along with a commitment to maintaining healthy gross margins.