CATL falls to 6-month low after Hungary plant halted over worker nickel exposure

CATL shares plummeted to a six-month low on Wednesday, following the temporary suspension of operations at parts of the company's battery plant in Hungary. The halt was imposed due to elevated nickel exposure among nine employees, sparking concerns over the facility's accelerated cell production plans. Hong Kong-listed CATL shares dropped 4.1% to HK$568.00, marking their lowest point since March 10, in contrast to a modest 0.9% decline across the broader Hang Seng Index.

The Hungarian authorities ordered the suspension of work in three areas of CATL's Debrecen plant, pending the resolution of safety issues. However, equipment testing was permitted to continue. The situation arose after CATL reported that nine workers had shown higher-than-normal nickel exposure levels in biological monitoring tests. Further investigation by occupational safety inspectors revealed shortcomings in the provision of protective equipment, according to Caixin.

The impacted zones encompass facilities engaged in laser cutting of cathode and anode foils, electrode-foil winding, and cell drying. CATL has stated that the origin of the nickel exposure is under investigation, and the company has halted equipment commissioning while implementing stricter occupational safety protocols. The company initiated routine biological exposure monitoring in early June, with results revealing elevated nickel exposure in nine employees in early August.

This incident unfolds as CATL's Debrecen project inches closer to cell production. In 2022, the company had announced plans to invest €7.34 billion in a plant with an annual capacity of 100 gigawatt-hours to manufacture battery cells and modules. Work restrictions currently affect three areas of the plant, although authorities have allowed equipment testing to proceed, according to Caixin.

Cell production remains on hold as the facility undergoes commissioning and preparations for trial production. Meanwhile, CATL has already commenced the production of battery modules at the site.