The battery arm of Japan’s Panasonic will need to build four more factories to reach its target for a sharp boost in annual capacity of batteries for electric vehicles by 2031, its technology chief told Reuters.
The comments by Shoichiro Watanabe of Panasonic Energy (in the photo) are the Tesla supplier’s first clear indication of the number of additional factories it will need. They could also fuel expectations of more investment by Japanese companies in the United States, after a deal the two countries struck in March key to widening access for Japanese manufacturers to U.S. electric-vehicle (EV) tax credits.
Panasonic has said it is focusing on North America to build up capacity for production of 4680 batteries, the newest cells championed by Tesla’s chief executive, Elon Musk.
Previously it said it planned to build at least two new factories for 4680 production in North America by 2030. Oklahoma has been seen as a possible site. The four new plants will need to be supported by about a dozen factories of materials suppliers, Watanabe said, in a battery supply chain built around the principle of “local production for local consumption”.
Joint procurement with major customers could also be considered, he said, taking into account tax breaks under the U.S. Inflation Reduction Act (IRA) and the need to limit the carbon footprint.
Given the size of investment required, makers of materials used in the batteries will also need to make decisions about their plans as early as possible, he said. Panasonic will not rule out the possibility of a joint battery venture with Mazda as part of a supply partnership the companies are working out, Watanabe said.
Last month the firms said they would hold talks on setting up a partnership to supply Mazda with cylindrical lithium-ion batteries made in Japan and North America. They aim to sign off on it this year, and expect to supply batteries after 2025.