FRANKFURT -- China's Contemporary Amperex Technology Ltd (CATL) will build a battery cell factory in the German state of Thuringia to supply European automakers including BMW, three sources said.
An official signing ceremony will take place at a summit in Berlin with China's Premier Li Keqiang on July 9, two of the sources said.
CATL will produce lithium ion cells at the plant for use by German automakers in battery packs for electric cars.
"The location of Thuringia... is correct," the third source said.
BMW confirmed on Thursday that the automaker had awarded a contract worth just over 1 billion euros ($1.16 billion) to CATL so the battery maker can build a factory to make cells for electric cars in Europe.
Global and local automakers are bolstering their electric vehicle capabilities and China, the world's largest car market, has emerged as a leading player due to a government push to encourage zero-emission vehicles.
German automakers, shaken by a diesel-emissions cheating scandal, are also pouring cash into electric vehicles and have grown reliant on a raft of Asian suppliers as they raise production.
CATL is China's dominant battery maker. BMW rival VW recently picked CATL, and South Korea's Samsung and LG Chem to deliver $25 billion worth of batteries.
This month, Tesla's CEO Elon Musk said he favors Germany as the location for the automaker's first European battery factory.
Thuringia's Economy Ministry on Friday said it was negotiating with CATL about locating production in Thuringia.
"As far as we know, several locations across Europe are being considered for such an investment. These discussions have not been concluded," it said.
Local newspaper Thueringer Allgemeine said the investment may be made in the eastern German city of Erfurt, on the same site as a solar cell plant operated by Solarworld, a company which was deemed insolvent in March.
CATL declined to comment.
The Chancellor's office in Berlin had no immediate comment. Germany's Economy Ministry said it was not involved in a decision to attract an investment from CATL.
