Chinese automaker BYD might supply its Blade lithium iron phosphate (LFP) battery tech to Tesla for Chinese-market electric cars, according to a report from a local news source.

BYD will begin supplying batteries to Tesla in the second quarter of next year, and Tesla is already testing vehicles equipped with these batteries, according to the report, which cited anonymous sources familiar with the matter.

It's not yet clear—or confirmed by either company—but could potentially be related to Tesla's $25,000 EV project being led by a team in China.

Tesla CEO Elon Musk said last year that its battery plan—and diversification of its batteries, by energy density and purpose—would help enable such an affordable model. Tesla already uses CATL-supplied LFP batteries in electric cars built at its Shanghai factory, for the Chinese market.



But with Musk recently claiming that Tesla was using too many different kinds of batteries, we're not sure how this might fit in with the automaker's plans.

The Blade battery pack powers BYD's flagship Han EV and emphasizes cool running with a fireproof chemistry and configuration—although its energy density is quite good too.

For many years, BYD produced more electric cars than any other company, but was surpassed by Tesla in 2019. BYD doesn't sell passenger cars in the United States, but has developed a strong business around electric buses, building many hundreds at a factory in Lancaster, California. The company has also said it's open to sharing battery technology with other firms.

A wide range of automakers and tech companies are clearly considering BYD. Toyota and BYD have a joint venture focused on battery technology in China, and Toyota is reportedly considering the Blade batteries for a Chinese EV. The BYD format was also reportedly considered earlier this year as a possibility for the upcoming Apple car. It's unclear if the Apple car will ever make it to production, however.