Panasonic boosts Tesla battery production with $100M

The Tesla-Panasonic partnership is warming with expansion and cell innovation underway. The Japanese company will invest 100 million dollars at the Gigafactory 1 in Nevada to set up another production line to increase capacity by 10 per cent.

This is according to a report by the usually well-informed business paper Nikkei of Japan. Writes Nikkei: “The investment will be made in Gigafactory 1, a battery plant in the US state of Nevada with 13 production lines. Panasonic will add another line, increasing capacity by 10% to 39 gigawatt-hours per year.”

The move would be in line with a recently renewed agreement between Tesla and Panasonic. The deal saw Tesla sign a new three-year price agreement with the Japanese manufacturer to continue to produce and supply battery cells at Gigafactory 1 in Nevada. The timing of the upgrade in September also matches Tesla’s planned Battery Day set for 22 September.

Apart from an increase in capacity – the first since 2017 – Nikkei also reports that Panasonic is about to improve the energy capacity of the cells, “raising each battery’s storage capacity by 5%, starting in September.” Said improvement had been announced in July already. US EV battery chief Yasuaki Takamoto then told Reuters, that Panasonic plans to boost the energy density of 2170 battery cells it supplies to Tesla by 20% in five years and commercialize a cobalt-free version “in two to three years”.

So Panasonic is stepping up the game in a relationship that has not always been smooth. For example, Tesla blamed Panasonic for not supplying enough batteries during the decisive phase of the (delayed) Model 3 production start-up. Later, the Japanese company was again told that they did not want to make investments in the Gigafactory that Tesla said had been agreed upon. Also, Panasonic did not want to invest in a factory in China to supply the Gigafactory 3 in Shanghai with cells from there. In China, Tesla now purchases from LG Chem and CATL, increasing the competitive pressure on Panasonic.

CATL could become instrumental for Tesla moving ahead with in-house battery production and innovation for which Germany could become a testbed. Apparently, Tesla wants to manufacture its own battery cells in Brandenburg at the Giga Berlin factory currently under construction. The new cells could be based on the Roadrunner project for new cells made by Tesla that will also be produced in Fremont, California.

In Giga Berlin, Tesla will probably make the cells without an external partner, although nothing is confirmed yet. Battery production is to be part of the second expansion stage, and Tesla will have to apply for a new permit for the expansion.

nikkei.com (original source, paywall), insideevs.com