Elon Musk says he's open to supplying batteries to other car makers

29 July 2020 - 07:54 By Reuters
Elon Musk says Tesla is 'trying to accelerate sustainable energy, not crush competitors'.
Elon Musk says Tesla is 'trying to accelerate sustainable energy, not crush competitors'.
Image: Yasin Ozturk/Anadolu Agency via Getty Images

Tesla Inc chief executive Elon Musk said on Tuesday the company is open to licensing software and supplying powertrains and batteries.

Tesla has previously supplied batteries to Mercedes and Toyota Motor under separate partnership deals. Battery manufacturing is an area in which analysts and industry officials say the US electric car maker has a competitive edge compared with legacy car makers.

"Tesla is open to licensing software and supplying powertrains and batteries. We’re just trying to accelerate sustainable energy, not crush competitors," Musk said in message on Twitter.

It was unclear which types of batteries it will supply. Tesla currently runs a battery joint venture with Panasonic Corp, and also sources batteries from China’s Contemporary Amperex Technology (CATL) and South Korea's LG Chem .

Tesla is also planning to build its own battery manufacturing facility at its Fremont, California, plant under its "roadrunner" project.

Batteries are the most expensive and important component of electric vehicles (EV).

"The supply could lower the entry barriers for startup EV makers, posing a potential threat to legacy car makers with their own platforms," said Park Chul-wan, a South Korean battery expert and professor at Seojeong University.

"The strategy, if successful, will increase the EV market's dependence on Tesla," he said.

Musk said in a recent earnings conference call that the real limitation to Tesla’s growth is battery cell production at an affordable price, and said the company would expand its business with Panasonic, CATL and LG Chem.

In 2014, Musk said Tesla would allow others to use its patents in hopes of speeding up development of electric cars by all manufacturers.


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