Japan’s Panasonic Corp (OTC: PCRFY) is planning to build a large U.S. plant to produce a new type of electric vehicle battery for its key customer Tesla Inc (NASDAQ: TSLA), Japanese state broadcaster NHK reported on Friday, citing unnamed sources.
What Happened: Osaka-based Panasonic is looking for land in Oklahoma or Kansas and aims to pump in several billion dollars to mass-produce new high-capacity lithium-ion batteries, according to NHK.
The Elon Musk-led company is close to starting operations at its recently constructed Giga Texas facility, which borders Oklahoma to the south.
Panasonic in February had announced its plan to make improved batteries for Tesla before March 2023 at its western Japanese plant in Wakayama.
See Also: Tesla Battery Supplier Panasonic Cuts Entire Stake In Elon Musk Company
Why It Matters: Panasonic, an early investor in Tesla, last year shed all of its stake worth about $730 million it held in the electric vehicle maker at a huge profit.
It continues to count Tesla among key clients even as it inks new deals with Canoo Inc (NASDAQ: GOEV) and other EV makers.
A report by SNE Research in September named China's CATL as the frontrunner in battery manufacturing for EVs, with a 32.5% global market share. Tesla and Nio Inc (NYSE: NIO) suppliers LG Energy Solution and Panasonic came in at second and third, respectively.
Tesla and legacy automakers such as General Motors Co (NYSE: GM) and Ford Motor Co (NYSE: F) are rushing to secure battery supplies as they set steep targets to electrify their cars.
Price Action: Tesla's stock closed 4.6% lower at $839.3 a share on Thursday, and is down nearly 30% so far this year.
