After previous denials, Chinese automaker BYD could be shipping its batteries across the seas to power models made by American electric vehicle (EV) stalwart Tesla.
Tesla currently sources two kinds of batteries from three different suppliers worldwide
This was according to a report by Reuters, quoting BYD Executive Vice President Lian Yubo’s interview with China’s state-owned broadcaster CGTN. “BYD respects Tesla, and we also admire Tesla,” he said. “We are now good friends with [Tesla CEO] Elon Musk because we are preparing to supply batteries to Tesla very soon.”
The video of the interview was released over China’s Weibo social media platform on Wednesday. While neither BYD nor Tesla have responded to requests for comment so far, BYD’s shares climbed by 2.79 percent following the senior executive’s statements. Meanwhile, shares of current Tesla battery supplier Contemporary Amperex Technology (CATL) dipped by 7.2 percent.
BYD claims its Blade Battery is safer and more energy-dense than conventional EV batteries
BYD earlier denied reports in 2021 that it will supply Tesla with its Blade Battery, developed by the Shenzhen-based firm to mitigate concerns about safety in EVs. Apart from withstanding extreme conditions without bursting into flames or exploding, Blade Batteries also feature a higher energy density and a smaller form factor than conventional EV batteries.
Utilizing a lithium iron phosphate (LFP) composition, BYD’s Blade Batteries have been in production since 2020, for use on its own vehicles as well as selling them to other brands such as Toyota. Tesla has relied on CATL as its sole provider of LFP batteries, which the U.S.-based firm regards as cheaper alternatives to nickel-cobalt versions that it also sources from Panasonic of Japan and LG Energy Solution of South Korea.
More than half of BYD's profits for 2021 were from EVs
According to BYD’s latest annual report, more than seven percent of its total profits for 2021 comprised rechargeable batteries and photovoltaic technology, while automobiles and other related products contributed more than 50 percent. If Tesla pushes through with its battery orders, it will be considered a major triumph for BYD, in the wake of its stronger than expected sales in May despite the recent pandemic restrictions in China.
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