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Elon Musk, CEO of Tesla. (Photo: Yonhap News) |
[Alpha Biz= Kim Jisun] South Korean battery materials maker L&F disclosed on the 29th that its cathode material supply contract with U.S. electric vehicle maker Tesla, originally valued at ₩3.8347 trillion, has been reduced to ₩9.73 million, effectively amounting to a contract cancellation.
In 2023, L&F announced that it had secured a two-year supply agreement to provide high-nickel cathode materials to Tesla from January 2024 through December 2025. At the time, the contract value was nearly four times L&F’s annual revenue of ₩970.8 billion, and was estimated to cover materials for approximately 783,000 electric vehicle batteries.
High-nickel cathodes, containing more than 90% nickel, are widely used in high-performance EV batteries due to their high energy density. L&F has continued to enhance its technology, increasing nickel content to as much as 95%, and currently supplies high-nickel cathode materials to major Korean battery makers including LG Energy Solution and SK On.
However, L&F said in its regulatory filing that the reduction was “unavoidable due to adjustments in schedules amid changes in the global EV market and battery supply environment.” The remaining ₩9.73 million reportedly reflects only the cost of initial sample deliveries. Industry sources noted that delays in Tesla’s in-house battery production plans appear to have played a key role.
“Given the sluggish sales of Tesla vehicles, including the Cybertruck, the cathode supply agreement with L&F has effectively been terminated,” a battery industry official said.
The slowdown comes as global automakers adjust EV production plans following the rollback of electric vehicle subsidies under the Trump administration in the United States. LG Energy Solution recently saw supply contracts worth ₩13.5 trillion canceled this month alone, including agreements with Ford and battery pack maker FBPS. SK On has also recently ended its joint venture with Ford.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
