Skip to main content

How Tesla Battery Day Confused Panasonic Investors

Nikkei Asian Review is noting that Elon Musk and Tesla shocked Panasonic investors at the Battery Day after Musk detailed Tesla's in-house battery ambitions. What do you think will be the future of the Tesla Panasonic partnership?

Tesla revealed Tuesday that it intends to produce 100 gigawatt-hours' worth of battery cells by 2022, enough for 1.4 million vehicles. "The volume is roughly three times what Tesla purchases from Panasonic today," writes Takeshi Shiraishi, Nikkei staff writer.

"Supplies to Tesla's new vehicles [from Panasonic] could potentially decline," said Tang Jin, senior research officer at Mizuho Bank. This development comes at a time Panasonic's business of producing electric car batteries for Tesla is becoming profitable after years or bumpy ride and hard work. As you can see, Bank questions the Tesla Panasonic partnerships' future.

Shiraishi notes that Panasonic has taken a wait-and-see approach regarding Tesla's latest battery plans and developments. I mean what else could Panasonic do?

"It's not our intention that a single company meets all of Tesla's demand," said a Panasonic executive, reiterating the supplier's stance.

"Lithium-ion batteries account for an estimated 30% of EV costs. Tesla has been busy incorporating competencies linked to batteries including by taking over Maxwell Technologies, a U.S. outfit that possesses proprietary electrode technology. By moving cell production in-house and radically modifying the processes related to electrode material, Tesla looks to cut production costs by 56% per kilowatt-hour," writes Shiraishi in his report.

Armen Hareyan is the founder and the Editor in Chief of Torque News. He founded in 2010, which since then has been publishing expert news and analysis about the automotive industry. He can be reached at Torque News Twitter, Facebok, Linkedin and Youtube.