(Yicai Global) Aug. 30 -- China's Contemporary Amperex Technology is predicted to increase its lithium iron phosphate battery business as Tesla has started offering the more affordable type of electric vehicle battery to buyers in the States.

Consumers who recently ordered the Standard Range Plus version of Tesla Model 3 may choose to have a China-made lithium iron phosphate battery in their cars and receive their vehicles earlier, Securities Times reported yesterday, citing emails that some buyers had received from Tesla.

Tesla is embracing the new technology that is more affordable than the current battery that has nickel. After a gradual switch, two-thirds of Tesla batteries will use lithium iron phosphate, Musk said recently during the California-headquartered company's second-quarter earnings call.

Ningde-based CATL is Tesla’s main supplier of lithium iron phosphate batteries. On June 25, the pair extended their supply agreement till December 2025.

The carmaker's shift could increase CATL's business. The battery producer announced on Aug. 18 that it will build a new facility in the Lingang Special Area of the China (Shanghai) Pilot Free Trade Zone where Tesla's first overseas Gigafactory is located.

But US buyers may have noticed that the update comes with a trade-off. Model 3s with the new battery feature a range of 253 miles instead of the earlier 263 miles. The price is the same at USD39,990.

Some users asked Chief Executive Elon Musk on Twitter what is the difference between the two versions. "I’d personally slightly opt for iron pack, as it wants to be charged to 100 percent, whereas nickel prefers 90 percent," said Musk.

In China, domestically produced Standard Range versions of Model 3 and Model Y both feature lithium iron phosphate batteries. Thus, their prices are lower. Model 3 costs CNY235,900 (USD36,470) and Model Y CNY276,000.

CATL’s stock price [SHE: 300750] was 0.5 percent down at CNY505.24 (USD78.10) in the afternoon.

Editor: Emmi Laine, Xiao Yi