Tesla has signed a three-year-long contract with Ganfeng Lithium Co Ltd, the world’s leading producer of lithium, with the view of making 4680-type battery cells for electric cars. Volumes and final prices remain to be negotiated, and shipments should start next year.
The 4680 battery type has been pioneered by Tesla, the number 46 referencing the cylindrical diameter of the cell in millimeters and the number 80 its height. Compared to 2170-type batteries currently made by Panasonic, new cells are said to have five times the capacity and six times the power rating. The effect on driving range is subject to diminishing returns, but an increase of around 16% is expected in any case.
Furthermore, the prime cost of manufacturing such a cell is 14% lower than its predecessor. Tesla already has a pilot 4680 battery production line running in Cato Rd, and is constantly working on expanding it.
Ganfeng Lithium Co Ltd is a lithium supplier based in Jiangxi Province, China. The company is considered to be the largest supplier of this metal worldwide in terms of market capitalization. It already has contracts running with EV makers, and the growing demand for lithium allowed it to boost its net profits compared to 2020. Three months ago, the Chinese company announced an intention to invest another $1.3 billion into expanding production.