Tesla Cybertruck Flop Proves Costly for South Korean Supplier

Core Insights - A significant reduction in the supply contract between L&F Co. and Tesla has occurred, with the contract value dropping from 3.83 trillion won to just 9.73 million won, marking a 99% decrease due to changes in supply quantity [1][3] Group 1: Contract Details - The high-nickel cathode material was intended for use in Cybertruck batteries, with the supply period set from January 2024 through the current month [2] - The reduction in supply was attributed to delays in the Cybertruck's development and a shift in consumer preference towards other Tesla models, such as the Model 3 and Model Y [2] Group 2: Broader Implications - The contract's revision was influenced by broader economic and policy issues, including the removal of Inflation Reduction Act subsidies [3] - Despite the contract changes, L&F stated that shipments of its flagship high-nickel product to major Korean cell manufacturers are continuing without issues [4] Group 3: Market Reaction - Following the announcement, L&F's shares fell by 11% in Seoul, although the stock has increased by approximately 16% this year, underperforming compared to the 76% rise in the benchmark Kospi Index [4]