Tesla’s exclusive use of 4680-format cylindrical batteries is set to end as LG Energy Solution has signed a major supply contract with China’s largest car exporter, Chery Automobile, to equip its premium electric vehicles with the next-generation cells.
The six-year agreement, valued at $730 million, will see LG deliver 8 GWh of 46-series cylindrical battery cells starting in early 2026. The deal marks a key expansion for the battery format originally championed by Tesla for its potential to reduce production costs and improve energy density.
Elon Musk unveiled the 4680 battery design at Tesla’s Battery Day in 2020, claiming it could be twice as cheap and significantly more energy-dense than existing cells. However, early iterations faced setbacks, including manufacturing difficulties, subpar energy density, and slower charging performance. Tesla eventually rolled out an improved second-generation version—nicknamed the Cybercell—in the Cybertruck.
While Tesla has continued optimizing the 4680 cells, including with a new dry-cathode production method, LG has also developed its own dry-electrode process. The Korean battery maker claims its 46-series cells surpass Tesla’s in cold-weather performance, energy density, and charging curve. These claims will be tested once Chery begins integrating the batteries into its premium electric vehicles in 2026.
The agreement underscores the growing competition in next-gen battery formats and may reshape market dynamics if LG and Chery achieve the scale and performance improvements Tesla has pursued for years.