Trade Tensions Shape CATL’s Blockbuster Hong Kong Debut

19 May 2025

CATL executives at the Hong Kong Stock Exchange on Tuesday, celebrating the company’s landmark listing. Peter Parks/Agence France-Presse, Getty Images

HONG KONG - Contemporary Amperex Technology Ltd. (CATL), the world’s largest maker of electric vehicle batteries, made a strong debut on the Hong Kong Stock Exchange, with shares surging 16% in the biggest global listing of the year, raising $4.6 billion. But in a clear sign of escalating geopolitical and financial tensions, onshore U.S. investors were barred from participating.

The move highlights how the deepening rift between Washington and Beijing is reshaping global capital flows. As the U.S. steps up scrutiny of Chinese firms, CATL opted to structure its Hong Kong listing under Regulation S, excluding American onshore buyers and bypassing certain U.S. regulatory disclosures.

Once cheered on Wall Street, Chinese companies like CATL now navigate blacklists, tariffs, and political headwinds. The Pentagon has labeled CATL a Chinese military-linked company, a designation the firm strongly denies. Meanwhile, U.S. lawmakers have applied pressure on Wall Street banks to disengage from the listing and proposed stripping subsidies from companies using Chinese battery tech, such as in Ford’s Michigan project that licenses CATL’s technology.

CATL’s listing is a striking contrast to the enthusiastic U.S. reception Alibaba received in 2014. “We are headed toward full financial decoupling with China,” said economist Stephen Roach. The U.S. government’s evolving stance launched under President Trump and continued by President Biden, reflects growing efforts to curb Chinese access to American capital markets on national security grounds.

Yet CATL’s investor base remains global. Major backers in the Hong Kong offering include Kuwait’s sovereign wealth fund, Hillhouse Capital, and Oaktree Capital Management. While some large U.S. institutions may still invest via offshore accounts, around 10% of American investors were effectively sidelined.

“This marks a significant shift,” noted Victor Shih, a China finance expert at UC San Diego. “We’re likely to see more Chinese tech and hardware firms shut out U.S. investors, limiting access to high-growth opportunities.”

As financial decoupling accelerates, CATL’s Hong Kong debut may well be a blueprint for Chinese companies navigating a bifurcated global financial system.