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Tesla Agrees to Buy LG Batteries for Vehicles Made in China

  • Korean company to supply batteries for China-made Model 3
  • Musk targeting production by year end at first non-U.S. plant
A Tesla Model X battery status.
A Tesla Model X battery status.Photographer: Jasper Juinen/Bloomberg
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Tesla Inc. agreed to buy batteries from South Korea’s LG Chem Ltd. to be used in electric vehicles produced out in China, according to people familiar with the matter.

Batteries made by LG Chem will be used initially in Model 3 cars manufactured in the plant near Shanghai, Tesla’s first outside of the U.S, said the people, asking not to be identified discussing a private matter. LG Chem batteries will also be used in Model Ys produced there once the compact crossover car is released, they said. Shares of LG Chem jumped.