Samsung Electro-Mechanics, the electronic components unit of the Korean giant, has reportedly secured a multi-billion supply deal with Tesla for camera modules.
According to The Korea Economic Daily, the contract is worth between 4 trillion won and 5 trillion won ($3.2 billion and $4 billion), with Samsung Electro-Mechanics beating rivals LG Innotek and Primax Electronics to win it.
The report notes that this is the largest contract ever for the electronic component unit, making Samsung Electro-Mechanics the largest supplier of camera modules for Tesla.
As per the agreement, Samsung will supply 80% of camera modules used by Tesla, with LG Innotek to deliver the remaining 20%. Camera modules made by Samsung Electro-Mechanics will be fitted to Tesla's entire lineup, from the Model 3, Model S, Model X and Model Y passenger cars to the Cybertruck pickup and Semi Class 8 truck.
The new camera module will be Samsung's 4.0 version with 5 million pixels, which show five times clearer images than the previous 3.0 generation. These cameras will power Tesla EVs' self-driving sensor suite and likely other features like Sentry Mode, Dashcam and more.
Samsung is likely to start mass production of the 4.0 camera modules as early as July. Neither Tesla nor Samsung commented on the potential deal, though.
The camera supply deal is the second big contract won by Samsung in the past year. The Korean company was also awarded a contract in September 2021 to supply Tesla with the next-generation Full Self-Driving 4.0 chip. This was in addition to another contract worth $436 million reportedly won by Samsung Electro-Mechanics in July 2021 to supply camera modules for a new Tesla model, likely the Cybertruck.
Unlike most automakers that use radar and lidar for their self-driving programs, Tesla's FSD program relies exclusively on cameras to get imagery for its neural networks. The latest version of Autopilot features eight cameras with a rumored resolution of about 1.2 million pixels; if accurate, this means the switch to Samsung's cameras with 5.0 million pixels will be a major upgrade.