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Tesla & Panasonic Make It Official, Buddy Up for Batteries

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Electric car startup Tesla Motors and battery cell giant Panasonic announced today that they will together develop nickel-based lithium-ion battery cells for electric vehicles. Panasonic has been rumored for months to be a battery cell supplier for Tesla’s planned Model S sedan, and today Naoto Noguchi, President of Panasonic’s Energy Company, said the Japanese firm’s cells will be used for Tesla’s “current and next-generation EV battery pack.”

According to today’s release, Panasonic is now around the halfway point in what it expects to be a $1 billion investment over three years in facilities for lithium-ion cell research, development and production. But Tesla is not putting all its chips on Panasonic’s supply. The startup notes today that the new cell resulting from its collaboration with Panasonic will allow Tesla to continue using cells from multiple suppliers.

Today’s deal comes as just the latest move in Panasonic’s efforts to bolster its energy storage business. At the end of December the company completed its acquisition of a majority stake in Sanyo Electric (gaining access to Sanyo’s rechargeable battery technology as well as solar panel tech), and announced plans to build a lithium-ion battery with enough capacity to power a typical home for up to a week. Following the Sanyo acquisition, Pansonic President Fumio Otsubo told the Yomiuri Shimbun, “In the area of automobile cells, we can deal with all kinds of eco-friendly cars such as hybrid cars or electric vehicles.”

Tesla said in October that it had delivered a total of “about” 900 Roadsters, a significant jump from just 700 in September. The startup apparently did not see a similar rise in the number of deliveries during the last few months of 2009: Today Tesla said it has delivered “more than 900 cars to customers in North America and Europe.”

As we noted back when Tesla was just starting to produce high-end Roadsters, the expense of battery cells wasn’t yet a major issue. But as the startup progresses toward its goal of producing tens of thousands of the lower-priced Model S sedan, then the cost of the thousands of cells in each battery pack gets much more important, or as Tesla CEO and Chairman Elon Musk put it in 2008, “fundamental to long-term electric vehicle production.”

6 Responses to “Tesla & Panasonic Make It Official, Buddy Up for Batteries”

  1. VanadiumJoe

    Panasonic better keep their eye on the vanaadium-lithium-phosphate battery technology coming out of China’s BYD electric car manufacturer – the biggest in the world run by China’s richest man and backed by a quarter billion USD from Warren Buffett. Vanadium adds five times the power/weight ratio to today’s lithium-ion batteries.

    Read about the vanadium battery here:

    Follow my tweets @VanadiumJoe to stay on top of this quiet revolution in battery technology.