Japan’s Panasonic to Start Building $4 Billion Battery Plant in Kansas
- November 1, 2022
- Posted by: Quatro Strategies
- Category: Manufacturing
Japan’s Panasonic announced on Monday it is set to start building a new battery plant in Kansas in November, aiming to launch mass production by March 2025. The company’s energy unit said in July it had picked Kansas for the site of its new battery plant to supply primarily Tesla. Japanese company joins other battery makers that aim to qualify for new EV tax credits and to take advantage of the U.S. market’s massive demand potential. Panasonic stated that the new plant’s initial capacity will be 30 GWh per year. That’s roughly equal to 60% of the company’s current annual EV battery production capacity in Japan and the United States.
Kansas state officials said in July the new battery plant would create up to 4,000 jobs with an investment of up to $4 billion, pending final approval by Panasonic’s board, which came through on Monday.
While declining to give a specific figure for the investment, Panasonic Holdings CFO Umeda said as a rough estimate that it would be “on a scale of more than $4 billion” .
The company said the factory would produce its 2170 model lithium-ion battery cells, which are already supplied to Tesla, but may eventually make the more advanced 4680 format battery currently under development that is about five times larger and is expected to offer major improvements in cost and vehicle range
“We decided to start with the 2170 model, which can be launched with a sense of certainty and speed because of the need for batteries as soon as possible,” Umeda said.
The company is yet to start production of its 4680 model. It expects to start mass production of the new model in its Japan factory by the end of March 2024. Umeda said the ramp up to mass production was proceeding as planned.
Panasonic on Monday also lowered its full-year operating profit forecast to 320 billion yen ($2.16 billion) from 360 billion yen for the year ending March 31.
The company posted an 11% drop in second-quarter operating profit, but performed better than estimates.
Although sales rose at its energy business, operating profit fell due to rising prices for raw materials and logistics, as well as increased development expenses and fixed costs as it increased production.
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