BYD and Tesla, two of the most influential brands in the global new energy vehicle (NEV) industry, have traditionally been fierce competitors. However, a recent development has transformed their relationship from rivalry to collaboration. Despite their ongoing competition, the two giants have partnered, with BYD becoming a battery supplier for Tesla. On May 22nd, media reports revealed that the first batch of BYD battery-equipped Model Y vehicles rolled off the production line at Tesla’s Berlin Gigafactory, marking Tesla’s first electric vehicle in Europe to feature lithium iron phosphate (LFP) batteries and BYD’s blade battery technology.
From Fierce Rivals to Strong Allies
Tesla, in its pursuit of expanding sales, has engaged in price wars and reduced prices in major markets such as China, the United States, and Europe. While the first quarter saw record-high sales of 422,000 units, the company’s net profit of approximately $2.513 billion experienced a 20% decline. Elon Musk remarked that Tesla’s focus is on sales volume rather than profit. To increase profitability, the European market holds significant potential. However, the intense competition in the domestic market and the challenge of boosting sales without new product updates and price adjustments make the task daunting.
With its presence already at its peak in the American market, Tesla aims to maintain its leadership and reduce costs, leading to its interest in BYD’s blade battery technology. BYD’s blade batteries can be directly integrated into the vehicle structure, eliminating the need to be grouped together like traditional battery packs. This innovative design offers increased space utilization by up to 50%, resulting in weight reduction and cost optimization.
Reports from June of the previous year hinted at BYD supplying Tesla with its blade batteries. BYD’s Executive Vice President and Head of the Automotive Engineering Research Institute, Lian Yubo, stated in an interview that “we are good friends with Musk, and we will immediately supply batteries to Tesla. We have a friendly relationship.” While Tesla initially denied this news amid widespread discussions, subsequent reports suggested that BYD-equipped Model Y vehicles were spotted at the Berlin factory, and they received approval from the Dutch Vehicle Authority (RDW) for the European market.
The course of events, including initial denials followed by confirmations, indicated that BYD took an upfront stance while Tesla was more hesitant. Eventually, it was confirmed that Tesla would indeed use BYD’s blade batteries. The BYD-equipped Model Y is expected to launch in the European market in June of the current year. This launch will mark Tesla’s debut of a pure electric vehicle equipped with lithium iron phosphate batteries in the European market.
Two Electric Vehicle Giants Unite
The collaboration between the two EV giants reflects their willingness to leverage each other’s technological strengths rather than engage in a head-to-head rivalry. Elon Musk mentioned during a financial results conference that Tesla would gradually shift towards using lithium iron phosphate batteries in the future.
Performance of the Blade Battery Version of Tesla
The BYD blade battery-equipped Model Y boasts a battery capacity of 55 kWh and a range of 440 km. In comparison, the basic version of the Tesla Model Y, exported from the Shanghai factory to Europe, features a 60 kWh lithium iron phosphate battery from CATL, offering a range of 455 km. Despite the slightly reduced range of the blade battery version, its impact on actual driving is relatively minor.
The first batch of vehicles equipped with BYD’s blade batteries showcased improved charging efficiency. These vehicles demonstrated a peak charging power of over 170 kW, allowing them to charge from 11% to 71% in just 15 minutes. The blade battery’s charging power of nearly 175 kW remains consistent until reaching 50% charge before gradually decreasing. In contrast, CATL’s battery starts to decline significantly after 20% charge. This indicates that BYD’s blade battery offers both higher and more sustained charging power.
Moreover, BYD’s blade battery, with its smaller size, can be seamlessly integrated into the vehicle structure, reducing overall weight and individual vehicle costs. The CTC assembly method employed by BYD directly incorporates battery cells into the vehicle chassis, creating a more stable and integrated structure. This approach enhances stability and allows the battery to contribute to the chassis’s load-bearing capacity. The smaller size of the blade battery also aids in reducing the vehicle’s overall weight. Additionally, the lower production cost of lithium iron phosphate batteries compared to ternary lithium batteries contributes to reducing the overall manufacturing cost of the vehicle.
As the supply chain for the new energy vehicle market continues to mature, China’s domestic brands are growing in competitiveness and strength. Whether in vehicle manufacturing or battery supply chains, Chinese brands are expanding into international markets and reaping the benefits of the rapid development in the new energy vehicle industry. The collaboration between BYD and Tesla enhances Tesla’s overall product offerings and sets the groundwork for future collaborations, aiming to create more efficient and powerful new energy vehicles.