Tesla Motors Inc (NASDAQ:TSLA) Gigafactory will get “billions of yen” or hundreds of millions of dollars as an investment from Panasonic Corporation (ADR) (OTCMKTS:PCRFY) (TYO:6752). Recently, the tech giant Panasonic set up a separate company in the United States, where it will solely produce lithium–ion batteries for Tesla Motors.
More investment later
The Investment is said to be the first instalment in the process, and the company officials say they will expand and pour more investment of similar amounts later, according to the Wall Street Journal.
“Our initial investment amount in the factory will be tens of billions of yen. We will expand the size as we go by pouring in further instalments of similar amounts,” said Panasonic Chief Executive Kazuhiro Tsuga at a trade show in Japan.
Previously, the tech giant announced that it has established a manufacturing company of lithium-ion batteries, in Sparks, Nevada, where Tesla Motors gigafactory will also be located. The decision to set up a company in the same place will help to maintain a strong communication between the firms, and therefore keep the supply of batteries at correct levels. Tesla CEO Elon Musk, in a conference call in July, informed that Panasonic is expected to contribute between 30% and 40% of the total cost of the gigafactory.
Gigafactory: Joint effort of Tesla, Panasonic
Tesla Motors biggest hit “Model S” sedan contains more than 7000 lithium-ion battery cells, which is produced by the tech giant Panasonic. These battery cells are same as used in laptops and game consoles, but batteries for Tesla are specifically designed for electric vehicles and are jointly designed and developed by Tesla and Panasonic.
Tesla and Panasonic are jointly responsible for the construction of the factory. This gigafactory will produce lithium-ion batteries, modules and packs for Tesla Motors electric cars and stationary storage devices. Also, the officials at Tesla declared that the factory will be shipping out 35GWh of cells and 50GWh of packs per year by 2020.
Tesla Motors Gigafactory is expected to span across 10 million square feet and employ roughly 6,500 people, will be located in Nevada. The reason for choosing this state is very genuine as Nevada in comparison to other states offers a lucrative tax deal to the automaker. As per the reports, Nevada’s financial incentives amount to roughly $1.25 billion spread over 20 years.