South Korea’s LG Power Resolution indicators $4.3 billion battery provide deal

South Korea-based LG Power Resolution introduced Wednesday that it had signed a $4.3 billion contract for supplying batteries to a significant company, with out naming the client.

The efficient date of contract — receipt of orders — was Tuesday and it’ll conclude on the finish of July, 2030. Throughout this era, the counterparty is not going to be disclosed to keep up enterprise confidentiality, the corporate’s submitting with the Korea Trade confirmed Wednesday. Reuters reported that Tesla was the counterparty.

Earlier this week, Tesla CEO Elon Musk confirmed that the EV maker was behind a beforehand undisclosed $16.5 billion chip contract with South Korea’s Samsung Electronics. 

LG Power stated in its submitting that particulars of the settlement such because the deal quantity have been topic to vary and the contract interval might be prolonged by as much as seven years. 

The worth of the disclosed contract eclipses the corporate’s 5.6 trillion Korean received ($4.05 billion) income for the second quarter of this 12 months.

“Traders are suggested to fastidiously think about the potential of adjustments or termination of the contract when making funding selections,” the corporate cautioned. It is shares have been buying and selling 0.26% decrease. 

The submitting didn’t make clear whether or not the lithium iron phosphate batteries can be utilized in autos or vitality storage techniques. Its main battery prospects embody American electric-vehicle makers Tesla and Common Motors.

The corporate has been increasing its manufacturing within the U.S., with its first North American ESS battery manufacturing hub, positioned in Michigan, coming on-line within the second quarter of this 12 months. The corporate can also be establishing a plant in Arizona that can produce lithium iron phosphate batteries. 

LG Power Resolution and Tesla didn’t instantly reply to CNBC’s requests for remark.