According to the latest report, Japan’s Panasonic Holdings said on Monday that it will start construction of a new battery factory in Kansas in November and plans to start mass production by March 2025. Targeting the fast-growing electric vehicle market in North America.
The energy unit of Panasonic Group, which supplies batteries to Tesla Inc., said in July that it had selected Kansas as the location for a new factory, mainly for Tesla, joining other battery suppliers in plans to conduct large-scale operations in the United States. Invest at scale to comply with new EV tax relief rules and to meet potentially large local demand.
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Panasonic said in a statement that it expects an initial production capacity of 30-gigawatt hours. Kansas state officials said in July that the new plant will create as many as 4,000 jobs and cost as much as $4 billion, pending final approval from Panasonic’s board of directors.
“As the global transition to electric vehicles accelerates, we are examining how to strengthen our battery production capacity in North America and meet the growing demand from our automotive partners,” Kazuo Tadanobu, president of Panasonic Energy, said in the statement.
The company said the plant will produce lithium-ion battery cells for its Model 2170 electric vehicles. The conglomerate also lowered its operating profit forecast for the year ended March 31 to 320 billion yen from 360 billion yen. In contrast, the average forecast of 19 analysts was 349.9 billion yen.
Panasonic reported an 11% drop in second-quarter operating profit, but it beat analysts’ expectations. According to Refinitiv data, the company posted an operating profit of 86.1 billion yen in the three months to the end of September.
Despite higher sales in its energy business, operating profit fell due to higher prices for raw materials and logistics, as well as higher development and fixed costs as it ramped up production. Rivals CATL and South Korea’s Energy Solution posted strong battery profit growth after passing on some of their cost increases to customers.
Though best known for consumer electronics and appliances, Panasonic has in recent years focused on making parts and servicing other businesses, including batteries for Tesla’s electric cars.
Moreover, Panasonic said that by 2029, it plans to expand its battery production capacity three to four times, with most of the increase in North America. Panasonic is working to supply Tesla with larger batteries for the Model 4680 to start production in Japan in the next fiscal year.
