TESLA DELIVERY GROWTH LIFTS THESE EV BATTERY SUPPLIERS, REPORT
The slump in electric vehicle sales in China and the U.S. — the world's two largest car markets — has this year slowed the global battery industry, whose top customers are automakers. TeslaTSLA was a rare exception, as its first-quarter EV deliveries ticked up compared to last year. That increase lifted sales for its battery suppliers PanasonicPCRHY and LG Energy Solutions, according to a report from the South Korean market research company SNE Research.
In January and February of this year, the amount of energy held by batteries for electric vehicles (EV, PHEV, HEV) registered worldwide totaled 135 gigawatt-hours, a 4.4% increase vs. 2025, SNE reported. However, that growth was considerably slower than the 45.5% compound annualized growth rate the industry had from 2017 to 2025, according to SNE Research's data.
On Monday, Tesla stock opened down almost 3%, according to MarketSurge. The stock fell 2.15% a day earlier, after two price target cuts. The automaker will report earnings on April 22.
Tesla Battery Suppliers
For differing reasons, sales among major EV manufacturers in China and U.S. struggled over the past year and into 2026. In China, stiff competition cut into sales for top brands. Meanwhile, in the U.S. consumers soured on EVs, forcing car companies to scrap plans for new models. However, Tesla bucked those trends with total EV deliveries in the first quarter rising 6% year-over-year.
Panasonic, which is a key battery supplier to Tesla, saw its deployments rise 2.7% to 5.3 gigawatt-hours in January and February, according to SNE Research. Tesla is Panasonic's largest customer for EV batteries. However, Tesla's decision to shift focus away from auto sales and toward self-driving tech, robotaxis and robots is likely to hurt Panasonic's business.
"While sales of the Model Y, a key customer model, showed prominent growth, sales for the Model 3, Model S, and Model X declined, signaling a shift in the demand structure across different vehicle types," according to SNE Research. "In particular, with the production halt of the Model S and Model X now confirmed, a decrease in battery demand due to the scaling back of the high-end lineup appears inevitable."
Get IBD's Daily Newsletter At Investors.com
At the same time, Tesla is also expanding its own in-house battery production, as the company seeks to become more vertically integrated.
Meanwhile, fellow Tesla supplier LG Energy Solutions saw its EV battery deployments drop 2.7% compared to 2025, according to SNE Research. Tesla was a bright spot for the company, while other customers like Chevrolet, FordF, and VolkswagenVWAGY dipped.
"For Tesla, battery installation volume saw a significant boost, driven by strong sales of the Model Y," the report reads.
Other Battery Suppliers
The top battery producers in the world in the first two months of this year are the Chinese companies CATLCYATY and BYDBYDDF, which have a 42% and 13% market share, respectively, according to SNE Research.
CATL benefited from the stiff competition among the many EV players in the Chinese market, while BYD, which is a carmaker in its own right, did not. In January and February, CATL recorded 56.9 gigawatt-hours worth of battery sales, a 13.7% increase compared to the same period last year. Much of the growth came from Chinese EV companies like Li AutoLI, NIONio, and ZEEKR, which launched new models.
Meanwhile, CATL's sales to Tesla fell because of declining sales of the Model 3, according to SNE Research. Tesla will not release a new version of the Model 3 in China, as some industry analysts had expected.
In January and February, BYD's EV sales dropped 12.5% compared to the same period last year to 18.1 gigawatt-hours, good enough to still hold on to the second spot in the global market, according to SNE Research. Much of the declines came from its own struggling EV business in China. However, it did see growth among commercial customers like the Chinese state-backed construction company XCMG and overseas clients such as the Indian automaker Mahindra, according to SNE Research.
"This pattern demonstrates that while BYD is pursuing customer diversification, it remains highly susceptible to volatility in its own EV sales due to a structural reliance on internal demand," the report reads.
YOU MAY ALSO LIKE:
Get Full Access To IBD Stock Lists And Ratings
Why This IBD Tool Simplifies The Search For Top Stocks
IBD Digital: Unlock IBD's Premium Lists, Tools And Analysis Today
How To Invest: Rules For When To Buy And Sell In Bull And Bear Markets
Tesla China Sales Show It Isn't Struggling As Much As Its Rivals
2026-04-07T14:16:26Z