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Panasonic 4680 Tesla Batteries
Panasonic 4680 Tesla batteries, compared to older style cells. Image courtesy of Panasonic.


Panasonic Will Invest $700 Million To Make Next-Generation Batteries For Tesla

Panasonic intends to expand a factory in Japan to produce 4680 battery cells for Tesla.

Nikkei Asia reports that Panasonic will invest $700 million to expand its battery factory in Wakayama prefecture, Japan, and bring in new equipment to manufacture the new 4680 battery cells developed by Tesla. When completed, the factory will be capable of producing about 10 gigawatt-hours per year of the new batteries, enough to power about 150,000 electric vehicles. That is about 20% of the company’s total battery manufacturing capacity from its factories in Japan, the US, and other countries.

The 4680 batteries cost 10% to 20% less to manufacture and have about a 15% higher energy density than the lithium-ion batteries that Tesla has been using to date. The extra energy density means a Tesla Model S would have a range of 750 kilometers, versus 650 kilometers today. Panasonic says the first batteries should be produced early next year.

Panasonic Fights To Win Back Market Share

Panasonic was Tesla’s go-to battery partner for a long time, but CATL and LG Energy Solutions have also started supplying batteries to Tesla, reducing Panasonic’s market share. The Japanese company expects to win back some of its business with Tesla by being the primary supplier of 4680 battery cells to Tesla.

“We are studying various options for mass production, including a test production line we are establishing this business year. We don’t, however, have anything to announce at this time,” Panasonic said in a statement to Reuters this week. Panasonic also expects to find other customers for the large format batteries in China and other global markets. Not only are the larger cells less costly to manufacture, they are also easier to fit to the chassis of an electric vehicle, which further lowers production costs.

The rest of the industry is not standing still. CATL, LG Energy Solutions, SK Innovation, and many other battery companies are plowing billions of dollars into new manufacturing facilities. It may be that one day someone will come up with a new battery technology that doubles energy density but costs half as much to manufacture. Until that day arrives, however, a 15% improvement in energy density at a 20% reduction in cost is remarkable news. It’s further proof that the EV revolution is happening right before out eyes.


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Written By

Steve writes about the interface between technology and sustainability from his homes in Florida and Connecticut or anywhere else the Singularity may lead him. You can follow him on Twitter but not on any social media platforms run by evil overlords like Facebook.


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