Tesla makes battery supply with LG for Chinese Gigafactory 3, the report states
Tesla has reportedly signed a battery supply agreement with LG Chem for Gigafactory 3 in China. It would be Tesla's first deal to supply battery cells to their electric vehicles with a company other than Panasonic.
At first, CEO Elon Musk said that all of Tesla's new factories, including Gigafactory 3 in China, would include the production of both battery cells and full vehicles, but it appears the company had to change those plans for Gigafactory 3. [19659003] Because of the uncertainty surrounding the trade war between China and Trump's administration, Tesla decided to speed up the plan to establish production capacity in China to avoid increasing tariffs on US vehicles.
To speed up these plans, Tesla decided to keep on battery production, and instead they plan to partner with suppliers.
Musk said last year:
“Tesla will produce all battery modules and packages at China Gigafactory, as we do today in California and Nevada. Cell production will be sourced locally, probably from several companies (including Panasonic), to meet demand properly. ”
Bloomberg now reports that Tesla signed its first battery supply contract for the plant.
They went with LG Chem that supplies batteries to many other car manufacturers:
“Batteries manufactured by LG Chem will first be used in Model 3 cars manufactured in the facility near Shanghai, Tesla's first outside the United States,” the people said and asked not to be identified as discussing a private matter. LG Chem batteries will also be used in Model Ys produced there when the compact crossover car is released, they said. Shares of LG Chem jumped. ”
According to the report, the delivery agreement is not exclusive to LG Chem, which means that Tesla could also use other suppliers as originally intended. IT can also start producing its own batteries in Gigafactory 3 or elsewhere for use in Chinese-built Teslas.
The cells will be in 21[ads1]70 format, such as those currently built by Panasonic at Tesla's Gigafactory 1 in Nevada, and will be manufactured at LG Chem & # 39; s Nanjing plant, which is approximately 320 kilometers west of Shanghai.
It is not clear whether Tesla will be able to use the same chemistry it developed for the 2170 cells manufactured on Gigafactory 1.
Since Tesla's startup, Panasonic has always been the car manufacturer's only battery supplier for vehicles with the very small exception of a short-lived Tesla Roadster 3.0 battery replacement program.
Panasonic made cells in Japan and exported them to California for Tesla's Model S and Model X programs, while the two companies teamed up to make Model 3 cells at Gigfactory 1 in Nevada.
In recent years, Tesla began using Samsung SDI and LG Chem battery cells for its sta- tionary energy storage products, but Panasonic always had the exclusive contract to supply the car manufacturer with battery cells for its electric vehicles.
Recently, Tesla confirmed everything but it will make its own battery cells with the new battery technology it acquired from Maxwell earlier this year.
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