One of the world`s largest battery suppliers, CATL, has signed a contract with Tesla, reuters reports. Tesla, which has a long-standing battery delivery agreement with Japan`s Panasonic Corp. 6752.T, said in its profit appeal last week that its pact with LG Chem 051910.KS and CATL was on a smaller scale. SHANGHAI (Reuters) – China`s top battery maker CATL 300750.SZ said on Monday it had entered into a battery supply contract with Tesla TSLA. O signed. Tesla will determine the volume of the battery purchase between July 2020 and June 2022, based on its own needs, CATL said in a stock exchange, adding that the agreement does not impose restrictions on Tesla`s purchase volume. Ningde-based CATL has signed a two-year supplier contract with Tesla, effective between July 2020 and June 2022, Reuters reported on Sunday. China`s leading manufacturer of electric batteries, Contemporary Amperex Technology Co Ltd, announced on Thursday that it had signed a volume production price agreement with U.S. automaker Tesla, according to the China Securities Journal. The Reuters article is a bit of a light on the details, but gives us more information than we knew before.

The agreement has a two-year deal that will begin in mid-2020, but imposes „no restrictions on Tesla`s purchase volume.“ Fisker and Magna International have agreed to begin the production phase of the Ocean Fisker SUV. The agreement has a two-year period between July 2020 and June 2022 and does not contain defined capacity restrictions. We have already heard in November about an alleged delivery contract between CATL and Tesla. At the time, the agreement was only provisional, but it now appears to have been confirmed by both parties. In March 2019, Bloomberg announced that they were talking about a battery delivery contract for Tesla`s first car in China, the Model 3s. a tentative agreement was confirmed at the end of November. On Thursday, Reuters reported that Tesla had signed battery supplier contracts with CATL and South Korea`s LG Chem Ltd (OTC: LGCLF). At the time, the parties did not confirm a partnership.

CATL said: „The collaboration is not an „intentional agreement,“ and „Tesla is going to buy lithium-ion batteries from CATL.“ CATL products are in the vehicles of almost every major global car brand and, starting this month, they will also power tesla-made electric cars at its new factory on the outskirts of Shanghai. It`s a lucrative alliance that combines the industry`s most popular plug-in model — the Tesla Model 3 — with low-cost batteries in a market that bought more than three electric vehicles for each sold in the U.S. last year, but faces an uncertain future as the pandemic shakes the global economy. Contemporary Amperex technology has not revealed who it wants to deliver. © 2020 Benzinga does not offer investment advice. All rights reserved. This will require a lot of batteries, according to Tesla is working to ensure the battery production capacity of several suppliers.

As part of the agreement, we learn that CATL will play an important role in Tesla`s 1 million-mile battery technology, which promises to change the face of the transportation industry with battery packs that cost only $80/kWh, well below the 100/kWh limit, to bring electric car prices to jointly co-ordered vehicles.