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Tesla, Panasonic confirm Gigafactory partnership

by Justin King

Tesla will manage the land and buildings, Panasonic will manufacture batteries.

Confirming recent leaks, Tesla Motors and Panasonic have finalized an agreement to cooperate on the construction and operation of the Gigafactory battery plant.

The California-based startup will prepare and manage the land, buildings and utilities, while Panasonic will be tasked with manufacturing and supplying the batteries and associated machinery.

The companies will also work to establish a network of supplier partners to produce the precursor materials for the lithium-ion cells. Many of the partners will likely be based in the same complex, alongside Tesla's own battery-module assembly operations, though half of the square footage has been allocated for Panasonic's battery-cell manufacturing processes.

Tesla expects to continue buying battery cells from Panasonic's factories in Japan to help meed projected demand in the near future.

"The Gigafactory represents a fundamental change in the way large scale battery production can be realized," said Tesla Motors CTO and co-founder, JB Straubel. "Not only does the Gigafactory enable capacity needed for the Model 3 but it sets the path for a dramatic reduction in the cost of energy storage across a broad range of applications."

The Gigafactory aims to produce 35GWh of cells and 50 GHh of packs per year by 2020, with employment expected to reach 6,5000 workers around the same time.

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