Apple is reportedly in the early stages of discussion with China’s CATL and BYD to purchase batteries for its electric vehicle. The talks are still in the preliminary stages, so they can either get shelved, or the terms could change.

One of Apple’s terms is that the battery supplier must make manufacturing facilities in the US to supply batteries to it.

CATL is the world’s largest battery maker for vehicles, and it already supplies batteries to Tesla. However, it is apprehensive of building a manufacturing facility in the US because of the political tension between the US and China. The high labor cost and investment are also other factors weighing in on its decision.

The report states that Apple wants to use lithium iron phosphate batteries for its electric vehicle. This is because this kind of battery is cheaper to manufacture than batteries that use nickel and cobalt. As for CATL, it is building a major new battery manufacturing facility in Shanghai that would further cement its position as the top automotive battery maker.

Earlier this year, reports emerged that Apple was in talks with Hyundai-Kia to build an electric vehicle. The reports suggested that Apple wanted Hyundai or its subsidiary Kia to manufacture Apple Car for it at a manufacturing facility in the US. However, talks between the two companies fell through. Apple is unlikely to partner with Japanese automakers who do not have the idle production capacity to outsource it to others.

Apple itself lacks the expertise to build an electric vehicle, so it remains to be seen what the Cupertino company plans to do. Reliable Apple analyst Ming-Chi Kuo has suggested that the Apple Car is still half a decade away at the earliest, and it is in the early stages of development, so there’s a lot that could change by the time the vehicle is ready to launch.