China’s Ganfeng Lithium Inks 3-Year Battery-Grade Lithium Products Supply Contract with Tesla

Tesla
(Source: Tesla)

Chinese firm Ganfeng Lithium Co., Ltd. and its subsidiary unit GFL International Co., Ltd. have signed a contract to supply battery-grade lithium products to U.S. electric vehicle maker Tesla, Ganfeng said on Monday in a filing. The new contract will allow the company and its unit to provide products to Tesla for three years starting from 2022. The sales amount and value of the contract are still pending Tesla’s purchase orders.

As of press time, the share price of Ganfeng Lithium was 166.66 yuan ($27) per share, up 2.81%.

The third quarterly report of Ganfeng Lithium shows that from January to September this year, the company achieved operating income of 7.054 billion yuan, a year-on-year increase of 81.19%. The net profit attributable to shareholders was 2.473 billion yuan, a year-on-year increase of 648.24%.

On October 27, the Jiangxi-based company disclosed that the newly-built lithium hydroxide project reached an annual output of 50,000 tons, and the production capacity and price of lithium salt products increased greatly this year. The company can produce 43,000 tons of lithium carbonate and 81,000 tons of lithium hydroxide every year.

Ganfeng’s previous two-year supply contract with Tesla, signed in 2018, saw the Chinese company commit to provide the carmaker with a fifth of its lithium production.

In addition to Ganfeng Lithium and CATL, JL MAG Rare-Earth Co., Ltd. and Tianci Materials Technology Co., Ltd., and Yahua Group publicly disclosed their supply contracts with Tesla in 2020, covering products like rare earth permanent magnet, lithium battery electrolyte and lithium hydroxide.

SEE ALSO: Tesla Orders 45GWh in Batteries From CATL, Expects Sales to Double Next Year

Insiders pointed out that under the background of rising purchasing enthusiasm for new energy vehicles, Tesla increased the supply of upstream lithium hydroxide products so as to accelerate the mass production of self-developed batteries.

Earlier, Tesla revealed in the conference call of the third quarterly report that its self-developed 4680 battery will be unveiled in the first half of 2022, and it is possible to be applied on the Model Y.