A rare and costly legal clash has erupted in China’s electric vehicle supply chain, with a subsidiary of auto giant Zhejiang Geely Holding Group taking a battery maker to court over alleged defects that it says triggered sweeping losses.
In a lawsuit filed in the eastern city of Ningbo, Vremt — a Geely unit — is seeking at least 2.31 billion yuan ($330 million) from Sunwoda Electronic Co., accusing the battery supplier of delivering faulty products over a multiyear period. Sunwoda disclosed in a stock exchange filing dated Dec. 26 that it received formal notice of the lawsuit the previous day.
The case lands as China tightens its focus on EV safety, turning what is usually a behind-the-scenes quality dispute into a public courtroom battle.
Claims Span Years of Battery Deliveries
According to the filing, Vremt alleges it suffered damages tied to quality problems in battery cells supplied by Sunwoda between June 2021 and December 2023. The lawsuit contends those defects rippled through the supply chain, affecting vehicles equipped with the batteries.
Sunwoda said it could not immediately determine the financial impact of the litigation. A company representative did not respond to a request for comment.
Investors reacted swiftly. Shares of Sunwoda plunged 11% on Monday, the steepest one-day drop since April, underscoring market unease over the size of the claim and the reputational stakes.
