Big News For Tesla; Panasonic Takes Place Of Toyota In Battery Wars

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Tesla Gigafactory locations

On top of news regarding BMW’s new suitcase 24-kilowatt charger unit, Tesla Motors and Panasonic have announced a new deal to create, develop and launch a new U.S.-based gigafactory capability, with a goal of full production by 2020. Currently, the group is looking at four locations in California, Arizona, New Mexico and Texas.

Both Tesla and Panasonic are being quite coy about the agreement, although spokespersons for the Japan’s Nikkei Exchange suggest that a formal deal could come as early as the first of next month. That said, however, for Tesla’s part a press representative at San Carlos, declined to comment on “…speculation regarding Panasonic.”

Nevertheless, Japanese financial analysts assert that the agreement is a done deal, with Panasonic agreeing to initially providing close to 20 to 30 billion yen ($196.4 million-$294.7 million) in infrastructure and equipment support. The projects’ aim is to extend and enhance production volumes for Tesla’s lithium-ion battery system, in order to not only leverage better overall production economies of scale, but also allow those advantages to apply against further cost reductions for the company’s nextgen vehicle, the Model 3.

tesla gigafactory production

The new vehicle is oriented to competing head-to-head with competitive mid-market products like the Nissan Leaf, BMW i3, Honda’s new Accord and the E-Class Daimler, in addition to positioning itself as a bulwark against the emergence of FCEVs coming from South Korea and Japan.

The overall gigafactory concept is based on the development of three U.S. facilities and, thereby produce 1 million or more battery units each model year. Nikkei reports further assert that when all is said and done, Panasonic’s ultimate investment in the new business relationship can reach up to $5 billion (U.S.).