Samsung SDI has signed a multi-year deal to supply electric vehicle batteries to Mercedes-Benz Group AG (MBGYY), marking its first supply to a Mercedes-Benz model. The agreement, announced Monday, will cover next-generation compact and mid-size electric SUVs and coupe models.
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Trade TSLA with leverageSamsung SDI said the batteries will use high-nickel NCM chemistry, which supports a longer driving range and is often used in premium vehicles. The company did not share financial terms, but industry estimates suggest the deal could exceed $7.5 billion over its life.
The agreement follows months of talks. Industry sources noted that the two sides were in “final stage talks” as early as April. Samsung SDI President Choi Joo Sun also outlined a supply plan during meetings with Mercedes leadership in late 2025 and early 2026.
Meanwhile, MBGYY shares rose 3.72% on Friday, closing at $16.47.
A Strategic Win in Europe
The deal comes as global automakers look to reduce reliance on Chinese battery suppliers. Mercedes has existing ties with China-based CATL, but this move shows a push to diversify its supply chain.
At the same time, Samsung SDI is working to expand its role in the global EV market, where it competes with LG Energy Solution and CATL. By securing a long-term deal tied to a future vehicle platform, Samsung gains steady demand and stronger ties with a major luxury brand.
Focus on Next Generation EV Platforms
The batteries are expected to power vehicles built on Mercedes’ MMA platform, which supports its future compact EV lineup. Mercedes has already launched the CLA EV on this platform and plans to expand it with more models by 2028.
Battery supply deals tied to new platforms often last seven to 10 years and involve large volumes. Industry estimates suggest supply could reach tens of gigawatt hours, reflecting strong demand as EV adoption grows.
Overall, the agreement highlights how automakers and battery makers are locking in long-term partnerships ahead of the next wave of electric vehicles. It also shows how suppliers like Samsung SDI are positioning for growth outside China, especially in Europe’s premium EV market.
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