AutoBeta(AutoBeta.net)02/04 Report--

On the evening of February 3, Ningde Times issued a risk warning announcement again in response to the company's early disclosure of the relevant cooperation agreement to be signed with Tesla (Shanghai) Co., Ltd., saying that the impact of the cooperation agreement with Tesla on the company's future operating performance is still uncertain.

On the morning of February 3, Ningde Times issued an announcement confirming that it had signed an agreement with Tesla to supply lithium-ion power battery products to Tesla, which began to be supplied in July. According to the announcement, Tesla CEO Elon Musk mentioned in the fourth quarter 2019 earnings conference call held on January 30,2020 that "LG and Ningde Times will become their new partners", so he made a business cooperation explanation.

However, risk warnings were made in the two announcements issued on the 3rd. The company and Tesla agreed on the product supply mode and product standard during the business cooperation period. However, Tesla has no responsibility and obligation to purchase the company's products and does not guarantee the purchase quantity of products. Tesla will put forward the purchase demand according to the subsequent specific orders. The impact on the future business performance of the company depends on the specific orders of Tesla, which is uncertain.

It is also mentioned that the power battery industry is still subject to market competition and demand risks. As a continuously developing industry, more and more new competitors join in. Although the company, as a leading enterprise in the power battery industry, has strong technical and scale advantages, with the continuous increase of market competition pressure and the continuous improvement of customer demand, market competition is also intensifying.

In fact, Tesla's battery suppliers include Japan's Panasonic and South Korea's LG Chemical, in addition to Ningde. Panasonic has been supplying batteries to Tesla since 2009, but Tesla is gradually seeking other battery makers to reduce costs as conflicts continue.

Tesla is optimistic about the Chinese market and decided to build a factory in Shanghai, China, but Tesla has cooperated with LG Chemical of South Korea because Panasonic has no plans to supply Tesla's factory in China for the time being. As early as August 2019, foreign media reported that Tesla had reached a cooperation with LG Chemical to purchase batteries from the latter for electric vehicles put into production in China. From the Catalogue of Recommended Models for Promotion and Application of New Energy Vehicles released in December last year, the domestic Tesla Model 3 applies Panasonic and LG Chemical cells at the same time. With the lifting of the white list of domestic batteries, LG Chemical built a new factory in Nanjing in 2018, and its first phase project was mass-produced in the fourth quarter of 2019.

As sales of Tesla models continue to rise, Tesla has also said that insufficient supply of Panasonic batteries is a "fundamental constraint" on Tesla's electric vehicle production. It means seeking cooperation from multiple battery manufacturers to ensure adequate supply chain is also part of Tesla's plan. Although Tesla has announced a partnership with Ningde Times New Energy Technology Co., Ltd. on battery supply, the supply agreement is relatively small.

According to Tesla's latest sales data, Tesla has once again become the most popular electric vehicle brand in 2019, with annual sales exceeding 366,000 vehicles, accounting for 17% of the market, of which Model 3 sales reached 300,075 units, and sales will further expand as the domestic version of Model 3 begins to be delivered.

Obviously, Tesla's demand for supply chain is expanding with the increase of sales volume. Although the agreement signed with Ningde Times is to accelerate the realization of domestic Chinese supply chain, it is worth mentioning that foreign reports show that the cost of 21700 cylindrical lithium-ion battery jointly produced by Tesla and Panasonic exceeds US $150/kWh at present, which is higher than Panasonic's US $111/kWh and LG Chemical's US $148/kWh.

Welcome to subscribe to the WeChat public account "Automotive Industry Focus" to get the first-hand insider information on the automotive industry and talk about things in the automotive circle. Welcome to break the news! WeChat ID autoWechat