OSAKA – Panasonic will start production next year of prototypes of a new type of cheaper battery for Tesla electric vehicles.
The cylindrical cell, whose plans were announced in September by Tesla CEO Elon Musk, was developed internally by Panasonic at Tesla’s request. It is larger than the current batteries of the automaker, with 4.6 cm in diameter and 8 cm in length, and also uses different materials. The new design costs less than half an kilowatt hour, according to Tesla.
Panasonic will assemble a prototype production line at existing facilities. The cost of the project is estimated at tens of millions of dollars.
Although Tesla plans to make the new cell on its own, battery industry observers believe it will be difficult for the automaker to handle all production on its own. Panasonic will seek a future partnership to take over part of the manufacturing.
Panasonic recorded 473.5 billion yen ($ 4.57 billion) in sales for its automotive battery business in the fiscal year ended March 31, with Tesla as its primary customer. The company plans to expand capacity by 10% in 2021 at a US plant that operates with Tesla in Nevada and is considering a new plant in Europe.