Electric vehicles (EVs) are the future of transportation because more people and governments want to reduce pollution and stop relying on fossil fuels. But one of the main problems for EVs is that the batteries they need are expensive and not always easy to find. These EV batteries make up a big part of an EV’s cost and how well it works.
To make enough batteries for all the EVs people want, Panasonic Holdings Corp, a big Japanese electronics company that makes batteries for Tesla, wants to build two new battery factories in North America by 2030. They also want to increase how many batteries they can make each year to 200 gigawatt hours by 2031. That’s about four times as many as they can make now.
In this article, we will talk about why Panasonic wants to make more batteries in North America and what it could mean for the EV industry.
Why Panasonic is investing in EV batteries?
Panasonic is a famous brand that sells electronic products to consumers. They are also involved in the industrial and automotive industries. They have been working closely with Tesla for a long time, supplying batteries for Tesla’s cars like Model S, Model X, Model 3, and Model Y.
Panasonic has invested in a big factory called Gigafactory in Nevada, which makes special cylindrical batteries known as 2170. These EV batteries are used in Tesla’s vehicles and energy storage products. The Gigafactory is one of the biggest battery factories in the world and can produce 35 gigawatt hours of batteries every year.
But Panasonic doesn’t only work with Tesla. They also make batteries for other car companies like Toyota and Honda. In the future, they plan to find more customers for their batteries.
Panasonic believes that electric vehicle (EV) batteries are important for their business. They think that the demand for electric cars will grow quickly in the next few years, especially in North America, Europe, and China. Experts predict that global sales of electric cars will go from 3.1 million in 2020 to 14 million in 2025 and 31.1 million in 2030.
To take advantage of this big opportunity, Panasonic needs to make more batteries and make them cheaper. That’s why they are investing in new technologies and factories to improve their battery production.
What Panasonic is planning to do?
Panasonic is planning to construct two new factories in North America by 2030 to produce 4680 batteries. The exact locations and investment amounts for these plants have not been revealed yet, but possibilities include Nevada, Kansas, or other places. The final decision will depend on factors like demand, supply chain, and incentives. Panasonic will work closely with Tesla and other customers to determine the best locations.
The 4680 battery cell is a new type of cylindrical cell that Tesla introduced in September 2020. It is said to provide five times more energy, six times more power, and 16% more range compared to the previous cells. The design and manufacturing process of the 4680 cell are also simpler, which could reduce costs by 56%.
Panasonic has been collaborating with Tesla to develop and produce the 4680 cells, which are expected to lower costs and enhance the performance of electric vehicles. Currently, Panasonic has a pilot production line for 4680 cells at its factory in Wakayama, Japan, while Tesla is already producing them at its Fremont plant in California.
Panasonic aims to achieve a production capacity of 200 gigawatt hours per year for automobile batteries by March 2031, which is four times its level at the end of March. Around half of this capacity will be allocated to North America.
What this means for Panasonic and the EV industry?
Panasonic wants to build new battery factories in North America. This is a big move that could help them compete better against other battery makers like LG Energy Solution, Samsung SDI, and CATL2. By making more batteries and making them cheaper, Panasonic could offer lower prices and better quality to its customers.
This plan could also make Panasonic’s relationship with Tesla stronger. Tesla is expanding its own battery production and using more than one battery supplier. If Panasonic works with Tesla to develop and make the 4680 cells, it can be sure that Tesla will keep buying batteries from them.
This plan could also help the electric vehicle (EV) industry in general. There would be more batteries available and their prices could go down. This would make EVs more affordable and more people would be able to buy them. It would also help more people switch to clean energy for transportation.
However, Panasonic’s plan also has some challenges and uncertainties. For example:
- The company hasn’t decided yet where it will build the new factories in North America.
- Panasonic hasn’t disclosed how much it will invest or how it will finance the expansion.
- Other battery makers who are increasing their production capacity could pose competition for Panasonic.
- There might be technical difficulties or delays in scaling up the production of the 4680 cells.
- Regulatory or environmental obstacles, as well as opposition from local communities, could be faced by the company.
- Fluctuations or disruptions in demand or supply due to factors like the COVID-19 pandemic could affect Panasonic.
- Government policies or incentives that impact the electric vehicle market might experience changes or uncertainties.
Therefore, Panasonic needs to carefully assess these risks and opportunities before proceeding with its plan.
Panasonic’s Ambitious Plan
Panasonic is a top battery maker for electric cars in the world. The company recently announced its intention to construct at least two new battery factories in North America by 2030. This is because there is a growing demand for electric vehicle batteries. Panasonic also wants to increase its production capacity for car batteries to 200 gigawatt hours each year by March 2031.
If Panasonic’s plan is successful, it could have an advantage over other battery manufacturers. It may also strengthen its partnership with Tesla. This plan could benefit the electric vehicle industry by increasing the availability of batteries and reducing their cost. However, there are some challenges and uncertainties that Panasonic needs to address.
Panasonic’s plan demonstrates its confidence and commitment to investing in electric vehicle batteries. The company believes that this is a significant area for its business to grow. It also indicates optimism about the future of electric vehicles as a sustainable transportation solution.