(Yicai Global) March 14 -- Tesla and BYD rebutted a news report that said the US electric vehicle giant will not renew a deal to buy power packs from the Chinese battery giant.

“That media report is false,” Tesla’s founder and Chief Executive Elon Musk tweeted today. “Relations between Tesla and BYD are positive,” he said. The Paper quoted a BYD executive as saying that “the news is not true and inconsistent with the actual situation.”

Citing an industry insider, the Korean Economic Daily said on March 12 that after the pair’s supply contract expired earlier this year, Tesla had not asked to renew the deal and would stop using BYD as the battery supplier for some of its Model 3 vehicles.

Tesla allegedly decided to end the cooperation because of problems with Shenzhen-based BYD's blade batteries, US electric car subsidies, and competition between the two companies, the report added.

According to an agreement they penned last year, BYD was to provide 10 gigawatt-hours of battery cells for Tesla vehicles in Europe. 

Shares of BYD [SHE: 002594] dipped 0.2 percent to end at CNY239.98 (USD34.90) each in Shenzhen today. In Hong Kong, its stock [HKG: 1211] fell 2.1 percent to HKD195.80 (USD24.95).

Editor: Martin Kadiev