Apple Car Battery Talks Stall in Another Blow to Electric Vehicle Project

Apple's negotiations with the Chinese companies CATL and BYD about supplying batteries for its rumored electric vehicle have mostly stalled, Reuters reports.

According to three individuals said to have knowledge of the discussions between Apple and the Chinese firms, the talks reached an impasse when CATL and BYD refused to set up teams dedicated to Apple and manufacturing plants in the United States. It has previously been reported that Apple is keen to bring at least some of the manufacturing related to the vehicle to the U.S., with particular focus on the batteries.

Apple allegedly wants to use lithium iron phosphate (LFP) battery for its electric vehicle, partly because they are cheaper to produce than more expensive lithium batteries that need cobalt and nickel. The company is understood to be looking to Chinese battery manufacturers because they can make more advanced LFP batteries than their rivals thanks to battery pack technology that bolsters performance, driving range, and energy density.

CATL is the world's leading manufacturer of batteries for electric vehicles and supplies Tesla, but has been reluctant to build a factory in the U.S. due to concerns about costs and geopolitical tensions. BYD already has an iron-phosphate battery facility in Lancaster, California, but simply refused to build a new factory that would supply Apple exclusively. CATL has also found it "impossible" to set up a dedicated product development team to exclusively work with Apple due to an inability to find sufficient personnel.

CATL and BYD apparently informed Apple several months ago that they were unwilling to meet these requirements, but Apple has remained hopeful that it can reach an agreement. Apple is now being forced to consider Japanese battery suppliers, such as Panasonic, and has sent a group of staff to Japan this month to explore this possibility.

Difficulties in establishing a supply of batteries could further delay the development of the vehicle, worsening existing issues after project leader Doug Field left Apple to join Ford. Kevin Lynch, who spearheaded the development Apple Watch, is now believed to be leading the vehicle project.