(Yicai Global) July 11 -- Contemporary Amperex Technology, China's largest power cell maker, has clarified that it has yet to ink a binding agreement to supply luxury carmaker BMW.

CATL acknowledged the receipt of a letter of intent from the German car giant to source new energy vehicle batteries from the Fujian-based firm, it said in a statement today. CATL denied that specific purchasing volumes had been agreed.

Media outlets reported yesterday that CATL had secured a contract with BMW to provide batteries worth USD4.7 billion. The letter indicates that CATL will supply products based on BMW's future demand across new energy models rather than a set number, the Chinese company added.

CATL said it still has a long way to go to achieve mass production of products suitable for BMW with extensive quality testing needed. It remains to be seen if the agreement will come to fruition due to uncertainty surrounding cell production, delivery times and the development of BMW's NEV models.

Reports of a deal coincided with an announcement the firm plans to first invest EUR240 million (USD282 million) in its European production base in Germany. The plant is scheduled to start operating in 2021.

Editor: William Clegg