While Elon Musk is ready and raring to go, battery partner Panasonic has been more cautious when it comes to Tesla’s proposed Gigafactory battery plant. But don’t let that fool you. Panasonic has big plans for the Tesla Gigafactory , expecting to become the sole manufacturer of batteries at the $5 billion facility.
Tesla and Panasonic recently signed a battery deal worth $7 billion, which would buy enough batteries to build 300,000 Model S sedans. Musk has greater ambitions though, hoping to bring down the cost of EV battery packs by some 30%. For its part, Panasonic has benefitted tremendously from Tesla’s success, and they seem ready to piggyback on that success by remaining Tesla’s main battery contributor. The electric automaker is buying so many batteries that it’s become the world’s largest consumer of batteries.
Panasonic doesn’t expect to have to deal with any potential rivals, such as Samsung, for Tesla’s business, especially with such a massive battery deal already signed. For its part, Tesla is still searching for partners from both the government and raw material suppliers, though the batteries may not all be earmarked for automobiles. Elon Musk’s other project, Solar City, is on track to need a ton of batteries itself. If it reaches peak output, the Tesla and Panasonic could produce 500,000 EV batteries annually at the Gigafactory.
I don’t expect any major automakers to try to get in on the Gigafactory though, as many still seem dismissive of Tesla’s potential. So far Elon Musk has made all the right moves though, and with Panasonic on board, the Gigafactory now seems like a sure thing.