Panasonic receiving 'strong requests from Tesla' for 4680 batteries

The new 4680 battery cell that Tesla unveiled at 2020’s Battery Day event features a new chemistry that promises to boost efficiency and reduce costs. Several battery suppliers are believed to be working on the new cell. Now Panasonic has announced a major investment in the development of the 4680, and says it plans to start mass production as early as 2023. 

Above: Years ago, Tesla was showcased front-and-center at a Panasonic's CES trade show booth (Source: Business Wire) 

The new cell is about twice the size of Tesla’s current 2170 cell, but has five times the capacity. The greater energy density should allow EV-makers to increase range, reduce costs, or both. According to Nikkei Asia, the new cell should cost 10% to 20% less per kWh to produce than current cells.

Panasonic plans to invest some 80 billion yen ($704 million) to expand its plant in Wakayama prefecture and install new equipment to mass-produce the new cells for Tesla. The Wakayama factory’s annual production capacity is expected to be about 10 gigawatts per year—around 20% of Panasonic’s total production capacity, and enough to equip 150,000 EVs.

Above: A look at Panasonic's vast experience across a wide variety of battery applications (YouTube: Panasonic Battery World) 

Regarding the 4680 batteries, the company's CFO Hirokazu Umeda noted during the company’s quarterly financial results that Panasonic is “receiving strong requests from Tesla,” according to Bloomberg. He added, “We’ll first prioritize supplying Tesla once the verifications are complete.”

Panasonic’s rivals are also bulking up on batteries. China’s CATL recently announced new investment of around 2 trillion yen. LG Chem has raised around 1 trillion yen by listing an affiliated company, and plans to use the proceeds to invest in the US. Toyota says it will invest 2 trillion yen in battery production and development by 2030.

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This article originally appeared in Charged. Author: Charles Morris. Source: Nikkei Asia