Tesla Prepares to Receive Batteries from BYD, Rival Company's Executive VP Says

Tesla Prepares to Receive Batteries from BYD, Rival Company's Executive VP Says

BYD is preparing to deliver its batteries to Tesla, the company's executive VP said. Although rumors about their agreement have been circulating for a long time, so far there has not been a single official confirmation.

BYD is ready to sell its Tesla batteries, a Chinese company executive told state media, according to Bloomberg. “We are good friends with Elon Musk and we are preparing to supply batteries to Tesla,” BYD’s executive vice president Lian Yu-bo said in the short video clip with state television broadcaster CGTN, released Wednesday.

This was the first official confirmation of the rumors, which first appeared about one year ago. In August 2021, it became known that a reporter had learned from a number of people familiar with the matter that BYD is going to supply Tesla with “blade” batteries in Q2 2022. In addition, sources said that Tesla car models that will be equipped with these batteries have already entered the C-sample testing phase. Days later, BYD denied rumors that it was supplying “blade” batteries to Tesla, claiming the company never told the media it would do so.

During the Q3 2021 Earnings Call, Tesla announced that it will use iron-based batteries for its standard Model 3 and Model Y models in all markets worldwide. This confirmed the earlier statements of Elon Musk, and finally outlined the direction of the company in this regard.

In connection with Tesla's announcement, information appeared in October that the company will buy LFP batteries from BYD. The source of Chinese media said that an American manufacturer has signed a deal to supply 10 GWh of LFP batteries. “The information I received is that BYD has already received a Tesla order for 10 GWh,” said an aforementioned industry source close to BYD.

According to the source, the order from Tesla came due to the fact that BYD already has a factory in Lancaster, California, USA, which greatly simplifies the supply of batteries to the manufacturer's factories in the USA. The BYD facility has an installed capacity of 1 GWh per year, however the production lines can be expanded to meet the growing demand. Tesla has a plan for rapid global expansion—to increase production capacity by 50% annually—purchasing as many battery cells as possible is a smart move.

© 2022, Eva Fox | Tesmanian. All rights reserved.


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About the Author

Eva Fox

Eva Fox

Eva Fox joined Tesmanian in 2019 to cover breaking news as an automotive journalist. The main topics that she covers are clean energy and electric vehicles. As a journalist, Eva is specialized in Tesla and topics related to the work and development of the company.

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