Contemporary Amperex Technology Co. of China announced on Monday that it has extended a supply agreement with Tesla Inc. for electric vehicle battery cells through 2025. The Chinese battery company announced in a stock exchange filing that it will continue to provide lithium-ion batteries to the Palo Alto, Calif.-based EV maker until December 2025.
Under a February 2020 agreement, CATL has started delivering lithium batteries to Tesla since mid-last year. Tesla has been able to lower the prices of its Shanghai-made Model 3 sedans by more than 25% since they were first delivered to the public in January 2020, thanks to local sourcing. Tesla China told local media last month that more than 90% of the parts utilized in the Shanghai production come from Chinese vendors. Tesla employs LG Chem batteries in its Shanghai factory, which also produces Model Y sport utility cars. CATL’s batteries may or may not be used in Model Ys. A request for comment from Tesla was not immediately returned. Singapore editors can be reached at singaporeeditors@dowjones.com.
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