Panasonic says it will 'demonstrate technological edge' with Tesla's new 4680 battery

After Tesla's watershed event, Battery Day, many wondered why Tesla was introducing their own battery cell? Why not work with their oldest battery partner Panasonic? Sure enough, Panasonic recently teased more information about how the company is working with Tesla on developing the new 4680 battery cell for mass production at Giga Nevada.

Above: Panasonic looks to supply Tesla with the new 4680 battery cell introduced during Tesla's Battery Day (Source: Tesla Oracle via Tesla)

The Japanese firm is stepping up. In the Financial Times, Yasuaki Takamoto, the Panasonic executive in charge of its EV battery business in the US says, "To produce batteries in a completely new size will entail bigger challenges in design, development and manufacturing. But that also gives us a chance to demonstrate our technological edge.”

Meanwhile, Panasonic’s Chief Financial Officer Hirokazu Umeda explained (via Reuters), "We have considerable know-how for that battery. We started working on it immediately after Tesla’s Battery Day (in September) and are also preparing to set up a prototype production line in parallel."

According to Reuters, "Panasonic’s decision to work on the new cell for Tesla comes as [a result of] brisk sales of Tesla EVs." The Panasonic CFO also said that the company is adding another production line at Giga Nevada in order to increase production capacity by 10%.

After a challenging Q2, Panasonic recently beat forecasts in Q3. The Japanese company's July-September operating profit actually rose to 92.8 billion yen ($886.34 million), compared with 83.9 billion yen a year ago. "We are targeting a profit margin of around 5% at our Tesla battery business within two to three years," Umeda noted.

Above: Panasonic’s plans to manufacture a new battery cell based on Tesla’s 4680 tabless battery (YouTube: Cleanerwatt)

In addition to the increased power, range, and energy density, the groundbreaking 4680 battery cell also helps in lowering manufacturing costs through its elegant simplicity and a 5x reduction in the electrical path.

It's worth noting that Panasonic has been a long-time partner at the Gigafactory in Nevada and the major supplier of battery cells for Tesla vehicles produced for the American market. However, Tesla also works with other battery manufacturers globally.

According to the Financial Times, "competition is fierce. LG Chem, the world’s largest lithium-ion battery maker, has indicated it was also working on a new battery cell with specifications similar to those outlined by Mr Musk. Tesla turned to LG Chem as well as CATL, which makes lithium-iron phosphate batteries, to supply the cells for its Model 3 cars in China."

That said, Panasonic's Takamoto admits, "We knew from the very beginning of our partnership that it would be impossible for Panasonic alone to achieve the pace of expansion Tesla was envisioning."


Written by: Iqtidar Ali. An earlier version of this article was originally published on Tesla Oracle. Source: Financial TimesReuters