Elon Musk's Tesla, LG Energy Solutions Sign $4.3 Billion Battery Deal: Report

LG Energy Solutions and Tesla Inc. TSLA have signed a deal worth $4.3 billion to supply LFP batteries for the EV giant's energy storage solutions.

Check out the current price of TSLA stock here.

What Happened: The deal would see LG supply batteries to Tesla from its U.S. production facility, Reuters reported on Wednesday, citing an anonymous source familiar with the matter.

The LFP battery supply contract is expected to last approximately three years, from August 2027 to July 2030, according to the report, with an option to extend the deal for up to seven years.

Why It Matters: The supply contract arrives at a time when LG had warned that President Trump's tariffs would lead to a decline in EV battery demand in America. The company is one of the few non-Chinese LFP suppliers.

However, for Tesla, the contract with LG is the second major deal between Elon Musk's company and a Korean manufacturer, as Tesla recently announced a $16.5 billion deal with Samsung Electronics Co. Ltd. SSNLF to supply next-gen AI6 chips.

The deal also could be a step forward for Tesla as the company aims to build upon what was a disappointing Q2 earnings call, which saw the company report falling revenue as well as declining sales in the U.S. and overseas.

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