Tesla secures cheaper battery cells that charge in 20 minutes

Tesla's battery supply chain has now gotten a new entrant that is providing it with cheaper LFP cells of the latest generation that sport 3C charging speeds.

This means that the LFP batteries from Sunwoda that Tesla has secured can charge in 20 minutes, which would be an upgrade for Tesla’s Model Y or Model 3 that are using such cells. Tesla's next global battery supplier is already shipping the cells out from its battery factory in Yiwu, and they are apparently destined for cars that are bound for overseas markets.

Tesla is clearly aiming at lowering the cost of the most expensive component in its electric cars, the battery. Instead of buying finished modules from its other local supplier, CATL, which is the world’s biggest battery maker and can dictate prices, Tesla is only sourcing the raw cells from Sunwoda. It then handles the module and LFP battery assembly in-house at the Shanghai factory, which gives it better cost control and more pack design flexibility.

Tesla is going through rough quarters, with sales dwindling for an accumulation of reasons, and its 2025 results were rather alarming as deliveries fell for a second consecutive year to 1.636 million units. Its automotive revenue dropped 10% year-on-year to $69.53 billion, too, while gross margin excluding regulatory credits slid to a meager 15.4%. That’s down from 27% in its 2021 peak.

While Tesla’s Q1 2026 financials may show some signs of recovery when they are announced after market close on April 23, batteries still account for over 30% of EV costs. That’s where Tesla needs to cut first, playing suppliers against each other, and it seems to be doing it. The LFP battery cell deal with Tesla benefits Sunwoda, too, as it is a second-tier supplier hungry for the exposure that a long-term battery contract with Tesla brings.

The advantage of getting a new supplier is that Tesla also gets the latest generation of its technology. Sunwoda's cells are not bringing just cost savings but are also of the third-generation LFP chemistry with a 3C charge rate. That's the kind of fast charging that Chinese domestic rivals have been pushing hard, and Tesla is apparently going to benefit, now that practically all new Superchargers it deploys are of the more powerful V4 variety.

Get the Tesla Universal Wall Connector with 24' Cable on Amazon