This Chinese Manufacturer Is Set To Supply Batteries To Tesla – And Its Stock Prices Are Rocketing

China’s BYD will ‘very soon’ become a supplier of Tesla Inc (TSLA.O) with batteries, a senior company executive told a state media anchor in a video released early on Wednesday.

“We are now good friends with Elon Musk because we are preparing to supply batteries to Tesla very soon,” said Lian Yubo, BYD’s executive vice president in an interview with Kui Yingchun, an anchor with China’s state-owned broadcaster CGTN.

BYD and Tesla took their sweet time to respond to requests for comment.

BYD is the world’s biggest manufacturer of the fleet including electric vehicles and plug-in hybrids. It has been working on supplying batteries to other automakers including Toyota.

In 2020, BYD officially launched its Blade battery, a less bulky lithium-iron-phosphate (LFP) battery that its Chairman Wang Chuanfu believed to be safer than other substitutes in the market and would not catch fire.

Chinese battery giant CATL (300750.SZ) is currently the single supplier of LFP batteries to Tesla, which has been installing such batteries in cars manufactured in the Shanghai plant since 2020.

Tesla stated that almost half of the vehicles it produced in the first quarter had LFP batteries – a cheaper rival to the nickel-and-cobalt-based cells that are rampant in the West.

Panasonic and LG Energy Solutions are the main suppliers of nickel-and-cobalt-based cells to Tesla.

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