- Sunwoda batteries are equipped in vehicles produced at Tesla's Shanghai plant for export, but have not yet been used in models for China.
- The battery cells supplied by Sunwoda to Tesla utilize third-generation LFP materials, supporting faster charging speeds.
Tesla is further expanding its supply chain footprint in China, with Sunwoda officially entering the company's global supply chain, Chinese media outlet 36Kr reported on Thursday, citing multiple industry sources.
Through its EV battery subsidiary, Sunwoda Electric Vehicle Battery Co Ltd (Sunwoda EVB), Sunwoda has become the US EV maker's fifth global power battery supplier, according to the report.
The new power batteries have already begun shipping from Sunwoda's manufacturing facility in Yiwu, Zhejiang province, 36Kr said, citing people familiar with the project.
These batteries are currently being equipped in vehicles manufactured at Tesla's Shanghai plant and sold to overseas markets, while there is no final conclusion yet on when they will be applied to domestic models in China, the report said.
The partnership adopts a new business model. Tesla is directly purchasing battery cells from Sunwoda, and will subsequently manufacture the battery modules and packs itself.
Compared to its previous practice of purchasing modules from CATL, this marks a new attempt by Tesla in the prismatic battery sector, which also facilitates deeper control over battery costs, the report noted.
The introduction of Sunwoda means Tesla's global power battery supply chain has been further diversified, as it has been seeking a second major Chinese supplier besides CATL.
BYD previously shipped batteries to Tesla's European plant, but there has been no clear progress, the report noted.
Power battery procurement costs still account for more than 30% of total vehicle costs. In 2025, Tesla's automotive business revenue fell to $69.526 billion, down 10% year-on-year.
Excluding regulatory credits, its automotive gross margin was only 15.4%, a sharp decline from its 2021 peak, forcing Tesla to seek higher bargaining power in the supply chain to boost profitability.
The cells supplied by Sunwoda to Tesla adopt third-generation lithium iron phosphate (LFP) materials, which support an increased charging rate of up to 3C, aligning with the industry trend of ultra-fast charging, the people familiar said.
Sunwoda attracts clients by offering highly competitive pricing and premium services. Prior to Tesla, Sunwoda had already established a joint venture with Chinese EV startup Li Auto.
Sunwoda EVB submitted its Hong Kong listing application in July last year. The company's total revenue reached 56 billion yuan ($8.2 billion) in 2024, according to its prospectus.
Sunwoda recently resolved a pending legal dispute. The company reached a settlement with a Geely subsidiary over a battery quality lawsuit involving claims of up to 2.31 billion yuan.
This is expected to have an impact of 500 million to 800 million yuan on its net profit attributable to shareholders in 2025, and all processed battery packs involved will belong to Sunwoda.
($1 = 6.8350 yuan)
