Tesla has reached a preliminary agreement with CATLs. According to the agreement, Tesla's vehicles produced in China will start using batteries from the Ningde era as early as next year.
According to foreign media reports, a person familiar with the matter revealed that Tesla has reached a preliminary agreement with Ningde Times. According to the agreement, Tesla's vehicles produced in China will start using batteries from the Ningde era as early as next year. In addition, the two sides are also negotiating to expand cooperation to a global scale.
People familiar with the matter said that Tesla CEO Elon Musk went to Shanghai at the end of August this year to meet with Ningde Times Chairman Zeng Yuqun. The meeting lasted about 40 minutes. After months of negotiations, the two companies reached a non-binding agreement. According to reports, the two parties are expected to reach a final agreement in the middle of 2020, but there is no guarantee that a final transaction will be reached.
The Ningde era battery will be used in the Model 3 produced by Tesla's Shanghai plant, which is expected to be put into production this year. But the two sides still need to finalize some details, such as how many batteries Tesla will purchase. Batteries are the most important parts of electric vehicles. Whether Musk can obtain sufficient battery supply in China's domestic market is very important for Musk. If local supply is available, it will allow Tesla to reduce its dependence on imports and reduce the impact of Sino-US trade tensions. In addition, Tesla's Chinese vehicles will also use batteries produced by Panasonic and LG Chem.
For the past nine months, Tesla has been building the Shanghai plant, the company's first plant outside the United States, with the goal of bringing the plant to mass production by the end of the year. In addition, the company is still constructing facilities for manufacturing batteries, but before the facilities are completed, they will purchase batteries from LG Chem. In August of this year, a source revealed that LG Chem did not qualify as an exclusive battery supplier for Tesla.
For Ningde Times, if it can sign a final agreement with Tesla, it will help build the image of a large global emerging battery manufacturer. The company, headquartered in Fujian, is already supplying batteries to a number of auto manufacturing companies, including Weilai, a local Chinese startup, and Volkswagen and Daimler, global car companies. The two parties are still talking about potential global supply contracts. If a global supply agreement can be reached with Tesla, Ningde Times will become the second Tesla global battery supplier after Panasonic.
A Tesla representative did not respond to a request for comment. LG Chemical and Ningde Times both declined to comment, and Panasonic did not immediately comment.
In the cost of electric vehicles, batteries account for a large proportion, which means that the contract value signed by battery manufacturers and top car companies can easily reach billions of dollars. The Model 3 produced in China starts at about $ 50,000, lower than other competitors' products, including Weilai's best-selling ES6.