Panasonic Sees Potential for Another EV Battery Plant in US

Elon Musk’s response to wavering demand and recession risk is pretty clear: slash prices, keep increasing capacity and try to continue growing even if it means sacrificing profit margin in the short term.

Hence, Tesla’s announcement this week of $3.6 billion more investment in Nevada, where it’s partnered for years with Panasonic at one of the world’s highest-volume battery plants. The carmaker said the splurge will go to 4 million square feet of manufacturing space that eventually will make 100 gigawatt-hours of cells (enough for roughly 1.5 million Model 3 or Y vehicles), as well as Semi trucks.

Musk has repeatedly referred to battery supply as the limiting factor for Tesla’s growth, and he’s far from the only auto CEO concerned about shortages. What makes him unique is his willingness to take on more risk than other executives can stomach.

Given all the uncertainty about just how quickly car companies and consumers will go electric in this more challenging macro environment, I jumped at the opportunity to speak with Allan Swan, the president of Panasonic Energy North America, on the show floor at CES earlier this month.

Panasonic has been producing Tesla’s 2170 cylindrical battery cells in Nevada since 2016. The facility now produces 37 gigawatt-hours of batteries a year (for context: one gigawatt can power about 9,000 Nissan Leafs).

Panasonic broke ground on a new $4 billion factory in DeSoto, Kansas, in November that’s supposed to start production in 2025, making 2170 cells for multiple customers, including Lucid.