Tesla and Panasonic ink deal to collaborate on gigafactory

Article by Andrew Christian, on August 2, 2014

Tesla Motors Inc. and Panasonic Corp. have reached an agreement to collaborate on the construction and operation of company’s gigafactory in the United States. Under the plan, Tesla will provide and manage the land and buildings while Panasonic will outfit the site with machinery and take charge of the production of lithium-ion battery cells.

In a statement, the companies said the gigafactory is aimed at cutting the cost of long-range battery packs in parallel with production at volumes required to asllow Tesla meet its goal of making mass market EVs.

The partners have yet to finalize certain details like sales and investment. Tesla will take Panasonic’s gigafactory cells and then assemble battery modules and packs for its EVs, including the new Model 3 sedan that will have a starting price just half of the Model S.

Tesla Chief Technical Officer and co-founder JB Straubel said in the release that the Gigafactory will provide capacity needed for the Model 3 and at the same time “sets the path for a dramatic reduction” in the cost of energy storage across a broad range of applications.

According to Panasonic Executive Vice President Yoshihiko Yamada, the gigafactory will help trim battery manufacturing costs while helping accelerate the expansion of the EV market.

The carmaker has disclosed that the gigafactory – which possible locations include Arizona, New Mexico, Nevada, California and Texas -- could cost up to $5 billion to build and would employ up to 6,500 people by 2020. [source: Tesla]

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