Elon Musk says Tesla’s relationship with BYD is ‘positive’ after report claimed battery supply deal was over

Elon Musk took to Twitter to debunk a story which said Tesla had ended a battery supply deal with China’s BYD. On the weekend a report emerged from South Korea which stated Tesla had decided not to use BYDs Blade batteries due to quality issues.

According to the report, which cited unnamed industry sources, those quality issued led to a series of battery fires in the Blade lithium iron phosphate (LFP) battery packs, causing Tesla to not request additional batteries from BYD after their supply deal expired earlier this year.

On Tuesday BYD refuted the report, telling Reuters it was “not in line with the actual situation.” Shortly after the Reuters report Musk backed up BYDs rebuttal saying the report was false and relationship between the two companies remained positive.

According to reports Tesla has been using the BYD Blade batteries in their entry-level Model 3 for Europe. However based on information obtained by Drive Tesla the automaker will soon officially introduce it at Giga Berlin with the impending launch of the made-in-Germany Model Y Rear-Wheel Drive (RWD) with a structural battery pack.

Reports first emerged in 2021 that BYD was close to entering an agreement to supply Tesla with enough BYD Blade batteries for 204,000 vehicles per year. In June 2022 BYD executive vice president Lian Yubo said in an interview they would “soon” start providing batteries to Tesla, however that interview was mysteriously deleted from Weibo shortly after it was published.

Then in August it was reported that BYD had already begun sending BYD Blade batteries to Giga Berlin for the Model Y.

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