Tesla signs supply deal with Ganfeng Lithium
Tesla has signed a new framework agreement with Ganfeng Lithium for the supply of lithium hydroxide for three years starting in 2022. The sales volume and order value are to be determined on the basis of Tesla’s specific orders.
This was reported by several media, including Reuters and the Chinese portal Gasgoo, citing a stock exchange notification filed by Ganfeng. Tesla had already taken lithium hydroxide from Ganfeng Lithium in 2018 to 2020. The contract at the time stated that Ganfeng Lithium would supply one-fifth of its production to Tesla.
According to Reuters, the follow-up contract has now been signed between Tesla, Ganfeng Lithium and its subsidiary GFL International. It is valid for three years from 2022 and is still subject to concrete orders by Tesla, the report says. No further details about the contract have been made public. It is also unclear whether Tesla will purchase lithium from Ganfeng in the current year, as 2021 is not included as a year in either the first or the now following three-year contract (2018-2020 and 2022-2025).
Ganfeng is a lithium hydroxide producer based in Jiangxi. Only in August, the Group announced an investment of 8.4 billion yuan (1.13 billion euros) in two battery production projects. Ganfeng is one of the big players in the lithium business and since 2018 has not only had a supply agreement with Tesla, but also with LG Chem and BMW. In spring 2019, Volkswagen also followed suit as a major customer. The Wolfsburg-based company has a ten-year contract, while the Bavarian company has a five-year contract with an option to extend for a further three years. The aim of all OEMs is to create a degree of security of supply in view of the rapid increase in vehicle electrification throughout the industry.
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