South Korean battery materials maker L&F reported on Monday that the value of its 2023 supply agreement with Tesla has dramatically fallen to $7,386, down from an earlier projection of $2.9 billion.

The company had initially announced that it would supply high-nickel cathode materials to Tesla and its affiliates in the United States and other regions from January 2024 through December 2025. L&F did not elaborate on the reasons behind the steep reduction in the deal’s value.

The revised figures highlight the volatility in the battery materials sector, which is closely tied to global electric vehicle demand and shifting supply contracts.