LG Energy Solution (LGES) in South Korea has signed a US$4.3 billion contract with an undisclosed company to supply energy storage system batteries.
A source close to the matter told Reuters that it was Tesla, as the U.S. company seeks to reduce its reliance on Chinese imports. The source said the lithium iron phosphate batteries (LFP) would be sourced from LGES’s Michigan factory.
However, neither LGES nor Tesla have confirmed the deal.
"In accordance with our agreement, we are unable to disclose the customer's identity due to confidentiality obligations," LGES told Reuters.
This comes after Tesla CEO Elon Musk confirmed that the EV maker was behind a previously undisclosed US$16.4 billion contract with South Korea’s Samsung Electronics earlier this week.
The LSEG deal is set to be higher than the Korean company’s US$4.05 billion revenue for the second quarter of this year.
LSEG is expanding its manufacturing to the U.S., first with its hub located in Michigan and an additional plant in Arizona.
The deal also came as three South Korean cabinet officials met with U.S. Commerce Secretary Howard Lutnick in Washington. During the meeting, they pushed to close a trade deal ahead of the 1 August deadline for 25% tariffs on U.S. imports from South Korea to kick in.
