Tesla has a new battery cell supplier. Although the automaker is vertically integrated to a degree not seen in the automotive industry for decades, when it comes to battery cells it’s mostly dependent upon suppliers. Panasonic cells can be found in many Teslas, with the cheaper, sturdier lithium iron phosphate (LFP) battery cells being supplied by CATL. Now Tesla has a new source of LFP cells thanks to a deal just signed with LG Energy Solutions.
According to The Korea Economic Daily, the contract between Tesla and LGES is worth $4.3 billion. LGES will begin supplying Tesla with cells next August through until at least the end of July 2030, with provisions to extend the contract if necessary.
The LFP cells probably aren’t destined for life on the road, however. Instead, they’ll likely be used in Tesla’s energy storage products, which both Tesla and LGES hope will soak up demand now that EV sales prospects look so weak in North America.
