Tesla wins $2.9 billion deal for cathode materials company

Shares of South Korea's L&F jumped nearly 20 percent after it secured a 3.8 trillion won ($2.9 billion) order from Tesla for cathode materials.

L&F will supply Tesla with high-nickel cathode materials for its automotive, energy production and storage businesses between January 2024 and December 2025, the company said in a regulatory filing on Tuesday.

L&F also supplies battery makers such as LG New Energy. The news sent shares in L&F up as much as 19 per cent in early trading on Tuesday, having risen almost 40 per cent so far this year.

Kim Jung-hwan, a researcher at Korea Investment & Securities, said in a note that he expects the deal to help Tesla continue its push to lay out its battery supply chain.

Competition among global automakers and battery makers to secure a steady supply of raw materials has intensified in recent years as sales of electric vehicles have increased demand for key battery materials such as lithium, nickel and cobalt.

This includes the signing of the Inflation Reduction Act by U.S. President Joe Biden, which provides a tax credit of up to $7,500 for electric vehicles purchased by companies that purchase battery mines from countries that have signed free trade agreements with the United States.

Shares of South Korea's L&F jumped nearly 20 percent after it secured a 3.8 trillion won ($2.9 billion) order from Tesla for cathode materials.

L&F will supply Tesla with high-nickel cathode materials for its automotive, energy production and storage businesses between January 2024 and December 2025, the company said in a regulatory filing on Tuesday.

L&F also supplies battery makers such as LG New Energy. The news sent shares in L&F up as much as 19 per cent in early trading on Tuesday, having risen almost 40 per cent so far this year.

Kim Jung-hwan, a researcher at Korea Investment & Securities, said in a note that he expects the deal to help Tesla continue its push to lay out its battery supply chain.

Competition among global automakers and battery makers to secure a steady supply of raw