Tesla Open to Licensing Software, Supplying Batteries to Other Automakers: Elon Musk

Tesla has previously supplied batteries to Mercedes and Toyota under separate partnership deals.

By Reuters | Updated: 29 July 2020 14:02 IST

Tesla Open to Licensing Software, Supplying Batteries to Other Automakers: Elon Musk

Batteries are the most expensive and important component of electric vehicles (EV).

Highlights

Tesla has previously supplied batteries to Mercedes and Toyota
It was unclear which types of batteries Tesla will supply
Tesla is also planning to build its own battery manufacturing facility

Tesla Chief Executive Officer Elon Musk said on Tuesday that the company is open to licensing software and supplying powertrains and batteries.

Tesla has previously supplied batteries to Mercedes and Toyota Motor under separate partnership deals. Battery manufacturing is an area that analysts and industry officials say the US electric car maker has a competitive edge compared with legacy automakers.

"Tesla is open to licensing software and supplying powertrains & batteries. We're just trying to accelerate sustainable energy, not crush competitors!" Musk said in message on Twitter.

Tesla is open to licensing software and supplying powertrains & batteries. We're just trying to accelerate sustainable energy, not crush competitors!
— Elon Musk (@elonmusk) July 29, 2020

It was unclear which types of batteries it will supply. Tesla currently runs a battery joint venture with Panasonic and also sources batteries from China's Contemporary Amperex Technology (CATL) and South Korea's LG Chem.

Tesla is also planning to build its own battery manufacturing facility at its Fremont, California, plant under its "roadrunner" project.

Batteries are the most expensive and important component of electric vehicles (EV).

"The supply could lower the entry barriers for startup EV makers, posing a potential threat to legacy automakers, which have their own platforms," said Park Chul-wan, a South Korean battery expert and a professor at Seojeong University.

"The strategy, if successful, will increase the EV market's dependence on Tesla," he said.

Musk said in a recent earnings conference call that the real limitation to Tesla's growth is battery cell production at an affordable price, and said the company would expand its business with Panasonic, CATL and LG Chem.

In 2014, Musk also said Tesla would allow others to use its patents in hopes of speeding up development of electric cars by all manufacturers.

© Thomson Reuters 2020

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