War Hunju Jin e Subrat Patnaik
(Reuters) – Tesla wants to convert its electric vehicles to cheaper batteries, but first a Chinese partner near its US plants must figure out how to overcome political tensions to build iron-based batteries.
The two largest economies in the world still have to settle disputes over fees and intellectual property. China’s widespread regulatory repression, primarily targeting the technology sector, could pose another hurdle.
China initially adopted the technology to produce 95% of the world’s lithium iron phosphate (LFP) batteries, but key patents expire soon and Tesla said it plans to adopt the LFP batteries of its global, standard-range vehicles. To its factories.
“Our goal is to find all the major automotive parts on the continent,” Tesla’s vice president Drew Paclino said Wednesday. Tesla establishes factories in the United States and Germany.
Tesla currently uses CATL’s LFP batteries in some Chinese – made models. In the United States, it began selling entry-level Model 3 sedans with LFP.
CATL will be the best in China, where they can access products at the world’s lowest prices, said Roth Capital’s analyst Craig Irwin.
President Joe Biden has made it a priority to support electric vehicles to combat climate change, but battery limitations can be a major obstacle.
China is the largest global market for EVs and dominates the supply chain for the production of lithium ion batteries, including the processing of minerals and raw materials.
Tesla faces higher costs, mainly due to the price of cobalt (+ 70% this year), nickel (+ 20%) and aluminum (+ 50%). Tesla uses these materials to build its batteries.
(Report by Hyunju Jin E Subrat Patnaik)
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