Tesla and Panasonic suspend Gigafactory expansion plans

Tesla and Panasonic have suspended plans to expand the capacity of Gigafactory 1, Nikkei reported. The two companies had planned to increase capacity at the Nevada plant by about 50 percent by 2020, but financial problems have forced them to put those plans on hold, the newspaper said.

Panasonic will “study additional investments over 35 GWh,” the Japanese company told Bloomberg, apparently meaning that it will consider ongoing demand before deciding when or whether to expand production capacity beyond the current 35 GWh.

“Panasonic will also suspend its planned investment in Tesla’s integrated automotive battery and EV plant in Shanghai,” Nikkei reported. “Instead, it will provide technical support and a small number of batteries from the Gigafactory. Tesla is committed to buying batteries for the cars built at the Shanghai factory from a number of makers.”


Electrek, generally very well-informed about Tesla’s doings, called the report “questionable,” noting that Nikkei cited no sources for the information. Also, Nikkei’s report that Panasonic is suspending a planned investment in Gigafactory 3 seems odd, because the company has not previously announced any such investment. Tesla has not announced any partners for Gigafactory 3, and has indicated that it would focus on vehicle production at first, sourcing cells from several manufacturers.

A Tesla spokesman seemed to confirm the halt to expansion in a statement emailed to journalists: “We will of course continue to make new investments in Gigafactory 1, as needed. However, we think there is far more output to be gained from improving existing production equipment than was previously estimated.”

Nonetheless, Electrek’s Fred Lambert says he will “take the whole thing with a grain of salt for now.” The stock market seems to be adding little salt to the dish – TSLA shares were trading sharply lower the day following the report.

Sources: Bloomberg, Electrek

Leave a Reply