Tesla's battery supplier, Panasonic, has a new friend in the form of Lucid, one of Tesla's chief rivals. The makers of the Lucid Air and Gravity have closed an agreement with Panasonic to supply lithium-ion batteries for the Lucid Group, reports Reuters.

"Partnerships with technology-leading EV manufacturers such as Lucid are critical to our mission," Kazuo Tadanobu," the head of Panasonic's energy business said. The vast majority of Panasonic's EV batteries go right to Tesla, which poses some interesting questions about the relationship between Tesla and Lucid.

More than likely, both brands will be receiving their own somewhat unique batteries, though no one should be surprised to see range figures become closer than they are currently. Panasonic has been looking to expand electric car battery production for some time as well, the report added.

Panasonic is planning a new $4 billion battery plant in Kansas. Critically, the new plant means Panasonic will have access to the benefits of Biden's Inflation Reduction Act, which is aimed to push battery makers and suppliers into American production.

For Lucid, the introduction of a fresh supplier in the form of Panasonic should help to ease some of the brand's recent woes. It cut production forecasts recently, citing chip shortage problems and supply chain shortages, which is not surprising considering the entire auto industry has struggled with this for a couple of years now. With a supplier based here in the US, the chain becomes shorter and more resilient for Lucid and Tesla.

The two brands' rivalry is obvious, and Tesla CEO Elon Musk taunted Lucid's production setbacks when it announced the cuts in August. The details of Panasonic's new arrangement with Lucid are still somewhat hazy, and it is not clear if Lucid will use similar 4680 cells when the production of the batteries starts in 2024. The batteries will be used in both the Air and the Lucid Gravity, which Lucid says will have an incredible range of up to 520 miles.