• Bloomberg


Panasonic Corp., Tesla Motors Inc.’s primary supplier of lithium-ion battery cells for its electric Model S sedans, has not committed to investing in a massive U.S. battery plant proposed by Tesla’s Elon Musk.

Joining Tesla’s “Gigafactory” battery project would raise investment risks, Panasonic President Kazuhiro Tsuga told reporters at a briefing in Tokyo on Thursday.

Tesla, which announced plans for the facility in February, said it is reviewing potential sites in four states in the U.S. Southwest. The plant may require an investment of as much as $5 billion to build and employ about 6,500 people by 2020, the Palo Alto, California-based company, said.

“Our approach is to make investments step by step,” Tsuga said. “Elon plans to produce more affordable models besides (the) Model S, and I understand his thinking and would like to cooperate as much as we can. But the investment risk is definitely larger.”

Musk, who is also Tesla’s co-founder and biggest investor, has said Panasonic may be involved in the factory. However, the Osaka-based company’s participation is “not 100 percent confirmed,” he told Bloomberg Television last month.

“Having Panasonic as a joint venture partner would facilitate strategic access to Panasonic’s supply chain and reduce risks,” Craig Irwin, a New York-based analyst at Wedbush Securities Inc., wrote in a note Thursday.

Irwin, who has an outperform rating on the stock, trimmed his share-price estimate for Tesla to $275 from $295.

Texas, Arizona, New Mexico and Nevada, the four states Tesla identified as possible factory locations, have started lobbying efforts to be chosen as the host. Tesla raised about $2 billion in a convertible bond sale to help fund the plant and for product development.

Musk, 42, has said the plant is critical to helping Tesla drive down battery costs and to expand lithium-ion cell supplies to allow the carmaker to sell hundreds of thousands of electric vehicles annually.

Tesla also wants to make batteries for home use to store electricity generated by solar panels, allowing customers to reduce their reliance on utilities.

Tesla relies on Panasonic for the battery materials, said Menahem Anderman, president of Total Battery Consulting Inc., in Oregon House, California. If Panasonic isn’t involved, that will make the factory much more of a challenge, he said.

Plasma panel plant sold

Osaka JIJI

Panasonic Corp. will sell a plasma display panel plant in Amagasaki, Hyogo Prefecture, to Center Point Development, a Tokyo-based real estate investment advisory company, the electronics giant said.

Panasonic reached the accord on the sale with the Hyogo prefectural and Amagasaki municipal governments, and Kansai Electric Power Co., which own land for the plant, as well as Center Point Development.

The sale is expected to take place by the end of September.

In a time of both misinformation and too much information, quality journalism is more crucial than ever.
By subscribing, you can help us get the story right.