Tesla Talking Batteries With China’s Lishen Battery Supplier

Tesla Model 3

JAN 22 2019 BY STEVEN LOVEDAY 17

It’s high time for Tesla to develop a battery cell partnership in China.

Recent news via Reuters suggests that Tesla will develop a partnership to supply batteries for its Chinese operations. Reportedly, the Silicon Valley automaker is talking with China’s Tianjin Lishen. If substantiated, Lishen will provide batteries for its upcoming Gigafactory 3 in Shanghai. Sadly, as usual, Reuters only published information from the usual “people familiar with the matter.”

As it goes, the two companies have already come to an early agreement. However, Lishen has no idea what battery size Tesla will require, nor the amount of cells required at this point.

Of course, Reuters goes on to say that the “details of the agreement were unclear.” If you aren’t well aware, there has become an increasing trend in which mainstream news media covers Tesla and other EVs on a more regular basis. However, they seemingly have no “real” clue about what’s going on for sure. Instead, they just cover information gleaned from unnamed sources and call it news.

The bottom line here is that Tesla most likely wants to deal with battery cell supply on a local level. This is critical as it moves forward with its Shanghai Gigafactory. At some point, one would assume the automaker — in partnership with a cell supplier — could move forward on its own, so to speak. But, just like the U.S. situation with Panasonic, an integrated cell supplier only makes sense. Nonetheless, Tesla told Reuters:

We have not signed any agreement of any kind with them [Lishen].

Lishen agreed that no contract or agreement is yet to be established.

Still, Musk tweeted in November that Tesla would locally source battery cell production at Gigafactory 3. He also included that the situation would probably include Panasonic as a partner:

Cell production will be sourced locally, most likely from several companies (incl Pana), in order to meet demand in a timely manner.

Panasonic revealed that it’s considering the situation, but has come to no immediate decision.

Source: Reuters

Categories: Battery Tech, Tesla

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17 Comments on "Tesla Talking Batteries With China’s Lishen Battery Supplier"

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I thought all battery cell technology is different. So if Tesla uses battery technology from a number of different suppliers wouldn’t there be differences in quality.
If there all identical what is Panasonic hiding at the Gigafactory.

Agree -I thought that Tesla and Panasonic tweaked the battery chemistry to be optimal for this application. Could Tesla share this with someone else???

The Tesla cars from the China factory are for the China market only. It is a requirement of the Chinese government that the batteries (and other parts) be locally produced to avoid import taxes.
The Tesla’s for everywhere else use Tesla’s unique bateries from GF1.

Yes there would be differences. Musk has said that there will be lower-priced variants of the 3 built and sold in China that won’t be sold other places.

And of course to do business and not be arbitrarily shut down, no doubt sourcing from Chinese instead of Japanese companies is mandatory even if never written that way.

I have a hypothesis: the low-price Chinese variants will use a lower-density, but less expensive, Lithium Iron Phosphate cell. They use only inexpensive materials, and are robust to large state-of-charge differences and temperature excursions. This means less expensive cooling and battery management systems.

Much of Chinese cell capacity is LiFePO. For instance, those used by BYD.

Well I thought Japanese have factories in China also.

Agreed. I suspect Panasonic is not too upset about Chinese cell makers having fewer opportunities to steal their IP.

China is moving away from LiFePO to NMC. BYD already converted a lot of their lines.

Produced locally is move toward 100% local. =)

How is this different from any other car maker?

Tesla bulls kept trying to make a point how unique Tesla’s batteries were supposedly – now Tesla buys cells from Asian battery suppliers like most other car makers do for their EV programs…to assemble them into modules and packs themselves.

In fact, Tesla always did that – Panasonic was/is just a supplier on-site for GF1.

CATL, BYD and the 3 largest S Korean suppliers will all overtake Panasonic in output volume soon (and therefore achieve better input costs/battery) – unless Panasonic and Toyota soon start making EV batteries together.

PS: Note that this is Toyota, not Tesla – and Toyota will most likely request next-gen batteries in the early 2020s.

CATL is nipping at Panasonic’s heels and BYD is not too far behind, but the Koreans got left in the dust. They are regrouping and making big plans, but are no threat to pass Panasonic any time soon.

Panasonic would be FOOLISH to move any production to China. Very foolish.
Hopefully, Elon is not foolish enough to give Tesla formula to Chinese companies.

BTW, Tesla does not ‘WANT’ to deal with Chinese battery supplier. It is simply put that if they do NOT buy from them, then they pay a lot more in taxes. China will later on try to force Musk to use Chinese batteries only as in in American cars.

Bloomberg Tesla Model # tracker has been really increasing the past week. Although the weekl number doesn’t seem to much since its only at a little over 4900.
Confusing

Their weekly number is useless.

Chinese made batteries are the ones that were catching fire and blowing up in Samsung smartphones. Samsung Note that got banned on the airplanes, you know?

And Boeing’s 787 batteries that were catching fire, where from a Japanese company.
So avoid Japanese batteries right?

China has the hardest safety test for new EVs. They require a steel pin to be driven through the battery pack without catastrophic results.

We’re those batteries produced in China or Korea for the Samsung S7.