Tesla Motors may source batteries from Samsung for its energy systems in homes, companies and utilities, rather than for its electric cars, the U.S. company’s chief executive said on Wednesday.
Shares of Samsung, an affiliate of Samsung, rebounded 3 percent early Thursday.
The stock had fallen 8 percent on Wednesday after Elon Musk tweeted that Tesla was working exclusively with longtime partner Panasonic to supply batteries for its upcoming Model 3, the company’s first mass-market car. Panasonic shares rallied nearly 4 percent on Wednesday after his comments.
Asked in a tweet whether Samsung batteries might be used in Tesla Energy, he responded, “yes.”
The company launched Tesla Energy storage systems last year to expand its business beyond electric vehicles into supplying energy for homes and businesses.
A Samsung spokesman declined to comment.
Reuters reported on Tuesday a source with direct knowledge of the matter saying that Samsung SDI was making progress in talks with Tesla to supply batteries for the Model 3, as well as Tesla’s energy storage products.
The source said Tesla planned to initially use Panasonic as the sole supplier for Model 3 and might add Samsung SDI if and when Tesla’s battery plant is unable to meet demand.
Tesla has taken 373,000 orders for the Model 3, which has a starting price of $35,000, about half its luxury Model S liftback sedan. It has said it would begin customer deliveries in late 2017.
Citing “tremendous demand,” Musk said in April that Tesla planned to boost total vehicle production to 500,000 in 2018, two years ahead of its original target. Suppliers have said the goal would be difficult to achieve.
Panasonic said last month it was ready, if necessary, to speed up its investment in Tesla’s $5 billion Gigafactory battery plant to meet demand for the Model 3.
The Japanese company plans to contribute $1.6 billion to the plant in phases over the next few years.