CATL boss opens up about Tesla electric car battery deal

CATL boss Zeng Yuqun has opened up about the Chinese electric vehicle battery maker deal with Tesla to make electric car batteries.

The Chinese battery maker, known in full as Contemporary Amperex Technology Co. Limited, has taken a front seat in the electric car battery world having recently revealed a deal with leading electric car maker Tesla that will drive down the costs of batteries.

In the first quarter of 2020, it also took the pole position from South Korean battery maker LG Chem, according to Korean energy industry analysis firm SNE Research, claiming 27.1% of the market ahead of LG Chem’s 25.7%.

We previously learned that CATL’s deal to provide electric car batteries to Tesla will go full tilt from the second half of 2020.

As part of the deal, it is understood that CATL will be instrumental in Tesla’s million mile battery technology which promises to change the face of the transport industry with battery packs that cost just $80/kWh, well under the $100/kWh barrier to bring electric car prices on parity with internal combustion engine vehicles.

The deal will likely put considerable pressure on LG Chem in terms of market share, as well as Tesla’s formerly exclusive battery partner, Panasonic.

Now, Yuqun has spoken about some details regarding the Tesla deal, and his comments hint at a possible future battery production partnership between CATL and the Californian EV maker.

Speaking with China Daily (Hong Kong edition), Yuqun confirmed reports that CATL’s deal with Tesla will not be limited to China, but also that the deal is not limited solely to the provision of batteries.

And although Tesla intends to keep making its own batteries, Yuqun added that CATL is in discussion with Tesla on making batteries collaboratively.

“Musk told me that Tesla wants to produce batteries itself, and as far as we know, their method will not affect ours,” Yuqun was quoted as saying by China Daily.

“And we are discussing how to make better batteries together,” Yuqun said.

According to the report by China Daily, Yuqun also emphasised that CATL is making progress in cobalt-free batteries.

As The Driven reported in February, Tesla was already in advanced discussions to use CATL’s low-cost, no-cobalt lithium iron phosphate (LFP) battery packs.

A report on the China Association of Automobile Manufacturers now also suggests that Tesla could already be ready to start making the “Made-in-China” Model 3 using the low-cost LFP technology (pundits will remember that Tesla lowered the price of the Chinese-made Model 3 in April to bring it within the limits of current Chinese electric vehicle subsidies).

According to the report, a catalogue from the China’s Ministry of Industry and Information Technology (MIIT) on May 15 showed the locally made Model 3 would be powered by LFP batteries.

Although the catalogue has now reportedly been deleted, it sparked speculation on whether the use of the cheap LFP batteries would be used in China-made Model 3s, bringing the price of the popular electric car down even further.