Photo/Zhang Xiaoqing (NBD)

Feb. 3 (NBD) – Contemporary Amperex Technology Co Ltd (CATL, 300750.SZ) has signed an agreement to supply lithium-ion power batteries to Tesla Inc., the leading Chinese power battery manufacturer said in a regulatory filing Monday. 

This makes CATL the third battery supplier of the U.S. electric car manufacturer, following Japan's Panasonic and South Korea's LG Chem. 

Shares of CATL rose 5.38 percent to 137.60 yuan (19.9 U.S. dollars) in the morning session on Monday, the first day of trading after the Chinese Spring Festival holiday. 

The agreement, which still needs to be signed by Tesla (Shanghai) Co Ltd, doesn't have restrictions on Tesla’s purchase volume, and the U.S. company will, based on its own needs, determine the volume of battery purchases between July 1, 2020 and June 30, 2022. 

In 2019, Tesla handed over 367,500 electric cars to customers globally, up about 50 percent from a year ago. Of those, deliveries for the fourth quarter of the year reached a record high of 112,000 cars. 

The company’s Shanghai gigafactory now has the capacity to produce 150,000 Model 3 cars annually, and the production will be ramped up to 250,000 units with the factory’s second-phase project construction, Tesla said in the recent quarterly financial report. The Model Y will also be manufactured there. 

Under the new partnership, Model 3 and Model Y cars made by the gigafactory in Shanghai will likely be equipped with CATL's power batteries, which will make them more competitive in pricing.  

Email: gaohan@nbd.com.cn