LG Chem said to more than double capacity in China to meet Tesla's battery needs

South Korea's LG Chem plans to more than double the capacity of its factory in China that makes batteries for Tesla to meet growing demand from Tesla's Chinese business, Sina said Tuesday, citing people with knowledge of the matter.

LG Chem is one of the battery suppliers to Tesla's Shanghai factory, and the company also plans to supply additional batteries it produces in China and South Korea to Tesla's factories in Germany and the US, the report said.

The report cites a source as saying that LG Chem has added production lines in South Korea this year, mainly to meet demand from Tesla's US factories. In addition, Tesla has asked Japan's Panasonic to supply its Shanghai factory as well.

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The source said Tesla simply can't get enough batteries, so LG Chem is going to more than double its production in China.

An LG Chem spokesman said, "We are continuing to expand our cylindrical battery production capacity in response to growing demand from automakers, but we cannot comment on specific customers."

The report comes as China-made Tesla Model Y (TSL6480BEVBA0) has been included in China's new energy vehicle model catalog, which means that the model has been approved for sale in China.

On November 5, The Ministry of Industry and Information Technology (MIIT) released documents showing that the China-made Tesla Model Y has completed regulatory filing, and the battery type is lithium-ion ternary battery.

The Model Y, a compact SUV developed by Tesla, is the fifth car to be introduced since the company's founding in 2003, and was unveiled in Los Angeles on March 15.

Battery suppliers for the China-made Model Y have been confirmed, with China's largest automotive lithium-ion battery maker CATL out and South Korea's LG Chem selected, according to a report by kkj.cn on November 24.

According to the report, LG Chem has signed an agreement with Tesla to supply power batteries for the China-made Tesla Model Y, which is expected to be mass-produced at the Shanghai factory in early 2021.

Currently, battery suppliers for the China-made Model 3 include both CATL and LG Chem.

The lithium iron phosphate batteries provided by CATL are used in the entry-level models of the China-made Model 3. LG Chem's lithium-ion ternary battery is used in the long-range, high-performance model.