Palo Alto, California-headquartered Tesla Motors and LG Energy Solutions are in talks to produce the automaker’s new 4680 battery cells at a new factory potentially in Europe or the United States, emerging media reports claim.

In September 2020, Tesla organized a ‘Battery Day’ event and used it to announce a major change in its battery strategy by introducing the world to a new tabless “4680” battery cell, which features a larger format with innovative chemistry.

Now, emerging media reports claim that LG Energy Solutions, which supplies battery cells for Tesla vehicles like the Model 3 EV, is pursuing talks with the EV giant to produce its new tabless “4680” battery cell somewhere in Europe or the United States.

LG started supplying battery cells for the China-made Model 3, becoming only the second battery manufacturer, after Panasonic, to have its cells validated for Tesla vehicles. Since the American automaker took wraps off its own new battery cell, LG has reportedly been trying to expand its role as a supplier for the automaker’s upcoming EVs.

Reuters reported that LG has plans to produce the new 4680 battery cells at its new US factory, but European country of Spain is also one of the other candidates for the plant.

Citing anonymous sources, Reuters reported, “LG plans to produce 4680 cells at its new US factory. They plan to build a new 4680 cell line to supply Tesla’s Giga Berlin in Europe … Spain is one of [the] candidates for the European plant.”

The anonymous sources also revealed that LG hasn’t yet secured orders from Tesla for the new battery cells, which would likely enter the production lines sometime in 2023. Currently, Tesla is boosting orders for 2170 cells that are being used in the Model 3 and Model Y EVs made in China. The sources stressed that LG currently has no experience in producing cells larger than 2170.

In the existing battery design, cells are combined to make modules. When these modules are put together, they form the battery pack. Tesla’s new battery design is totally different as it doesn’t use any modules. Rather, the whole battery pack is built as the EV’s structural platform. It not only helps in solidification of the platform as a single big unit but also in enhancing manufacturing ability as well as efficiency of battery packs.