SHANGHAI -- BMW will receive large cylindrical batteries for its electric cars in Europe from China's EVE Energy, two people with knowledge of the matter said, as the automaker follows Tesla in adopting the new technology.
EVE has signed contracts to be BMW's primary supplier of the battery cells in Europe for its new series of electric vehicles due to go on sale in 2025, said one of the people who has direct knowledge of the deal.
The vehicles will use the automaker’s Neue Klasse (New Class) architecture and will initially focus on midsize premium models such as the 3 Series.
Tesla this year started manufacturing its new larger-format 4680 cylindrical battery -- denoting 46 millimeters in diameter and 80 millimeters in length. It has said it expects the battery to lower production costs and improve range compared to the current-generation 2170 cylindrical battery.
Guangdong-based EVE's batteries will be similar in size, said the sources, who were not authorized to speak to media and declined to be identified.
Company filings also show EVE is planning a large cylindrical battery plant in central China.
EVE, a supplier to BMW in China, did not respond to a request for comment. BMW said it plans to release some battery-related news in early September but declined further comment.
The shift by BMW, which currently uses prismatic batteries, underscores growing momentum for larger-format cylindrical batteries.
Prismatic batteries, which are rectangular in shape, have become the most common form of auto battery in the past two years as they can be more densely packed, saving on costs. But proponents of cylindrical batteries argue the newer larger format cells have become more cost-effective due to improvements in energy density.