Tesla Motors Inc Seeks Japanese Partners To Take Gigafactory Risk

Tesla Motors Inc Seeks Japanese Partners To Take Gigafactory Risk
Tesla Inc TSLABy Maurizio Pesce from Milan, Italia (Tesla Factory, Fremont (CA, USA)) [CC BY 2.0], via Wikimedia Commons

Tesla is planning to set up another gigafactory, and this time it will be outside the United States. Tesla has always hinted that the one being set up right now will only be the first of many others to come in the future. As the construction of the first factory has begun, the Palo Alto-based company is now analyzing other geographies that are suitable for a massive factory.

Japanese must take more risk

A senior Tesla executive visited Japan last week to talk with suppliers about a possible gigafactory, according to a report from Bloomberg. Japan is the second most significant supplier of Tesla parts after North America. Kurt Kelty, director of battery technology for the EV maker, said during an event in Osaka that the country’s battery supply industry should increase its risk appetite. “We take risks,” Kelty said, “but it seems not the case in Japan.”

This event-driven fund is betting on ChampionX, Caesars and Vista Outdoor [Q1 Letter]

Investing investGates Capital's ECF Value II fund was up 9.4% for the first quarter, compared to the HFRI Event-Driven Index's 8.2% gain, the Russell 2000's Value Total Return Index's 21.2% gain, and the S&P 500's 6.2% return. Q1 2021 hedge fund letters, conferences and more Gates Capital Management is an event-driven value . . . SORRY! Read More

Kelty feels that sometimes Japanese firms are over cautious in product development, which would not go in line with the aggressive timetables set by Tesla. He recalls an incident in support of his theory on Japan, saying that once when Tesla wanted more production from a Japanese supplier, the supplier countered that the U.S. firm should scale down its plans for expansion, says the report.

Tesla already partners with many Japanese firms

The EV manufacturer has partnership with various Japanese companies such as Panasonic and Denso and plans to enter into a relationship with various small- and medium-sized suppliers. At present, Tesla has a battery supply agreement with Panasonic, which also holds a stake in the U.S. firm.

Kelty has worked with Panasonic for over 14 years and joined Tesla in March 2006. On his LinkedIn profile, it is mentioned that Kelty is the lead negotiator on the Tesla-Panasonic collaboration.

The Palo Alto-based company is hoping its Nevada plant will produce 35 gigawatt hours of cells and 50 GWh of battery packs each year by 2020. The majority of the battery will be produced for the 200-mile range Tesla Model 3, which is expected to enter production in 2018 with a base price of $35,000.

No posts to display