Tesla has signed a provide take care of China’s Ganfeng Lithium and its unit GFL Worldwide for battery-grade lithium merchandise. 

The world’s prime lithium firm by market capitalization ($226.9 billion as of Nov. 1, 2021), Ganfeng Lithium has equipped battery-grade lithium to EV producers prior to now, together with Tesla.

In accordance with a submitting with the Shenzhen Inventory Trade cited by Reuters, the brand new contract will permit the Jiangxi-based firm and its subsidiary to supply merchandise to Tesla for 3 years ranging from 2022. The gross sales quantity and contract worth are nonetheless pending Tesla’s buy orders, the doc reveals.

We will anticipate this deal to be vital seeing as Tesla goals to launch a number of key initiatives in 2022. For instance, the EV maker expects its latest factories in Berlin, Germany and Austin, Texas to begin preliminary operations by the top of 2021.

This doubtless implies that each these new vegetation will see a ramp of their operations subsequent 12 months. Add to this the truth that the Cybertruck and the Semi might lastly enter manufacturing in 2022 (albeit in the direction of the top of the 12 months in low volumes), and it ought to come as no shock that Tesla is securing further battery provide.

Each the Cybertruck and the Semi are anticipated to make use of the brand new 4680 battery with an enlarged, cylindrical cell that guarantees extra vary for much less price.

Ganfeng has been on a roll this 12 months due to rising lithium costs and sturdy demand, with its third-quarter and nine-month web income going up 507% and 648% year-over-year, respectively. In August, the corporate additionally introduced an 8.4 billion yuan ($1.31 billion) funding in two battery manufacturing initiatives.

Ganfeng’s earlier provide contract with Tesla signed in 2018 noticed the Chinese language firm commit to supply the carmaker with a fifth of its lithium manufacturing.

Final week, phrase obtained out that Tesla additionally positioned an order with Ganfeng’s rival CATL for 45 GWh value of lithium iron phosphate (LFP) batteries, sufficient to construct almost 800,000 Mannequin 3 Commonplace Vary Plus and Mannequin Y Commonplace Vary models.