China pauses new battery factory approvals until year-end

Local governments across China have effectively stopped accepting new filings for power-battery and energy-storage capacity since the second half of 2026, according to Caixin, while a central review of the entire sector's capacity runs through year-end. Projects already approved or under construction can proceed; only greenfield plans are frozen. The scale of the problem explains the intervention: planned Chinese cell capacity exceeds 6 terawatt-hours, enough to cover global demand until roughly 2035, and newly commissioned storage capacity fell 18% year-on-year in the first half after Beijing dropped a mandate forcing renewable projects to pair with storage. MIIT and three other regulators warned battery makers in January against blind construction and below-cost price wars. For buyers locking in supply deals with CATL and its rivals, the near-term effect is tighter discipline on pricing and less risk of a glut driving further cuts, at the cost of slower expansion once demand does pick back up.