Sources: Apple is in early-stage talks with China's CATL and BYD, two of the world's biggest automotive battery makers, to supply batteries for its planned EV
Apple Inc (AAPL.O) is in early-stage talks with China's CATL (300750.SZ) and BYD (002594.SZ), about the supply of batteries …
Context & Ripple Effects
Apple's car program has spent years assembling itself through other companies' assets: it sought advice from carmakers on parts and production as far back as 2015, ran autonomous shuttles with Volkswagen after failing to land BMW or Mercedes-Benz, and explored Canoo's scalable skateboard chassis last year. The manufacturing side looked settled in February when sources described an Apple-Hyundai-Kia deal as close, built on Hyundai's E-GMP platform per Ming-Chi Kuo.
Today's Reuters report adds the missing input layer: early-stage talks with CATL and BYD, the two largest automotive battery makers, to supply cells for the planned EV. That connects directly to the December 2020 report that the car may include internally developed lidar and 'breakthrough' battery tech — Apple appears to be pairing its own battery ambitions with incumbent cell suppliers.
First-order effects
- CATL and BYD would gain one of the most valuable potential customers in consumer hardware, with early-stage talks giving both a seat at the table before Apple finalizes its manufacturing partner.
- Apple's supplier shortlist now spans platform (E-GMP), assembly (Hyundai-Kia), and batteries (CATL/BYD) — but nothing is signed, so every named player remains negotiable.
Second-order effects
- A CATL or BYD win pressures whoever loses out — and forces Hyundai-Kia to reconcile its E-GMP platform deal with a battery choice Apple makes independently, since cell chemistry and pack design are tightly coupled to the platform.
- Western automakers' existing battery contracts face a new benchmark: if Apple secures supply from China's top two cell makers at scale, pricing and allocation leverage shifts further toward those suppliers across the industry.
Third-order effects
- If the pattern holds, Apple enters autos the way it entered phones: owning design and brand while renting manufacturing and components — making battery makers like CATL and BYD structural chokepoints rather than interchangeable vendors.
- The concentration of cell supply in two Chinese companies gives Beijing implicit leverage over any Apple-branded vehicle's production timeline, entangling the car program with US-China supply-chain politics already visible in chip equipment rules.
The trend: Apple's car effort is converging on an asset-light model — platform, plant, and cells all sourced from partners — which concentrates bargaining power in a handful of battery and platform owners.