South Korean battery material supplier L&F Co. announced December 29 that the value of its massive supply deal with Tesla has been slashed by more than 99%, reports Electrek.

The announcement comes as Tesla’s demand for the battery cells has experienced a “catastrophic drop,” the EV industry media outlet says, and is a strong signal that Tesla’s 4680 program, and the vehicle that relies on it, the Cybertruck, is in serious trouble.

In early 2023, L&F announced a $2.9 billion contract to supply high-nickel cathode materials directly to Tesla, but in a regulatory filing December 29, L&F revealed that the contract’s value has been written down to just $7,386.

The contract had been seen as a major move by Tesla to secure materials for its ramp-up of the 4680 battery cell, which Tesla CEO, Elon Musk, had touted as the key to halving battery costs and enabling cheaper electric vehicles, a plan he later scrapped. At present, Tesla’s Cybertruck is the only vehicle using the automaker’s own 4680 cells.

L&F did not explicitly state the reason for the cut, citing only a “change in supply quantity.”