Tesla Motors will provide batteries and chargers for Daimler's Smart EV, according to Tesla Chief Executive Elon Musk.

Initially, Tesla will supply lithium-ion batteries for 1,000 cars, but the deal could lead to production of 'tens of thousands' of battery packs if successful, he added.

The deal is not exclusive to Daimler, and Tesla is seeking similar battery supply deals with other automakers, Musk said at a conference hosted by the Society of Automotive Analysts.

The battery for the Smart EV is similar to the one used in the $109,000 Tesla Roadster.

Musk said Tesla hopes to show the first prototype in February of its next car, the Model S sedan, which the company expects to sell for around $50,000.

Tesla has applied for $700 million in federal loans and loan guarantees, in part to help finance the construction of an assembly plant to build the Model S, according to Automotive News. Pending the resolution of its loan requests, Tesla now anticipates that the Model S won't go on sale until 2011. It originally had planned to begin plant construction in mid-2009.

The company is targeting annual sales of 20,000 vehicles per year after the Model S goes into production.