(Yicai Global) Nov. 9 -- Chinese battery raw materials maker Guangzhou Tinci Materials Technology shares rose to a peak since its 2014 listing this morning after it became a long-term supplier to US electric vehicle producer Tesla.
Tinci’s wholly-owned Jiujiang Tinci High-tech Materials unit penned an agreement with Tesla last week for the long-term supply of lithium-ion battery electrolyte products to the EV manufacturer’s Fremont plant and under-construction Austin factory in the US and its future plant in Berlin, Germany, the Guangzhou-based parent said in a statement on Nov. 6.
The contract does not bind California-based Tesla to any set purchase volume, with the precise amount to be determined based on actual demand, per the statement.
Tinci shares [SHE:002709] closed 2.10 percent up at CNY73.80 (USD11.16) today. Its stock once rose nearly 5 percent to a historic high of CNY75.99 this morning. The company’s shares have risen by about 90 percent in the past two months.
The Fremont, California plant is already in normal production. The Austin, Texas Gigafactory broke ground only in July and the Berlin facility awaits construction permits expected at year’s end, public information shows.
The deal signals Tesla's recognition of Tinci’s research and development capabilities, quality system and production and supply abilities, and lays a foundation for future collaboration between the two, the statement added.
Tinci has four plants in China whose total output is 50,000 tons of lithium battery electrolyte. The firm has been actively expanding its lithium power battery electrolyte output in recent years.
In addition to the Jiangsu plant under construction, which is to have an annual output of 200,000 tons of electrolyte, the company will also build a lithium battery electrolyte plant in Ningde, Fujian province -- where Chinese lithium battery giant Contemporary Amperex Technology has its headquarters and main production base -- as well as putting up a separately-invested facility in the Czech Republic that will produce 100,000 tons of lithium battery electrolyte each year.
Editor: Ben Armour, Xiao Yi