While no decision has been made on where Tesla Motors Inc (NASDAQ:TSLA) will build its $5 billion “Gigafactory” yet, four states have been shortlisted and CEO Elon Musk will likely look at Japanese giant Panasonic as a partner going forward.
Panasonic and an unnamed state
“I would be surprised if Panasonic Corporation (TYO:6752) is not our partner,” Musk said Tuesday at an event in Beijing. Mr. Musk was at the event to celebrate the first delivery of the Model S in mainland China.
There has been much talk in recent years about disruption and trying to pick companies that will disrupt their industries. The debate continued at the Morningstar Investment Conference as Bill Nygren of Oakmark Funds faced off with Morgan Stanley's Dennis Lynch. Q2 2021 hedge fund letters, conferences and more Persistence Morningstar's Katie Reichart moderated the Read More
Panasonic Corporation (TYO:6752), in an emailed statement, said that no decision has been made and subsequently said very little. The company did say that it will always “look into a variety of options to strengthen” its ties with the Palo Alto-based maker of the Model S.
It was just February this year that Tesla Motors Inc (NASDAQ:TSLA) spoke of the factory that would cost around $5 billion while producing a number of jobs in order to make 500,000 Tesla sedans (and other models) each year. The factory was also deemed necessary in order to reach a cost target that would allow it to make a lower-end car powered solely by lithium-ion batteries that are presently nowhere near cheap.
That announcement has states in the southwest clamoring to be the state to host the 10 million-square-foot factory and thousands of jobs. Texas, whose dealership association has fought Tesla’s direct sales strategy tooth and nail, may or may not be in the running due to these regulations despite promises from legislators to work to change its laws.
The other states still in contention are Arizona, Nevada, and New Mexico. Musk also said that it is likely that it would begin construction in two locations in order to keep the risk of delays at a minimum.
Yesterday, the New York Times reported that a number of Tesla Motors Inc (NASDAQ:TSLA) customers were unhappy with delivery delays outside of Beijing and Shanghai but today Musk said, “We’ve resolved this.”
It’s expected that Tesla Motors Inc (NASDAQ:TSLA) will also invest hundreds of millions on charging stations in China in order to properly sell the Model S that is listed at $121,000.