Merged Tesla-SolarCity Would Partner With Panasonic At N.Y. Factory

Posted by Joseph Bebon on October 17, 2016 No Comments
Categories : Featured, New & Noteworthy

As electric vehicle (EV) manufacturer Tesla and residential PV provider SolarCity work toward closing a $2.6 billion merger agreement, Tesla has entered into a non-binding letter of intent with Japan-based Panasonic to collaborate on solar cell and module production at SolarCity’s Buffalo, N.Y., factory. However, the collaboration is contingent upon shareholder approval of Tesla’s proposed acquisition of SolarCity in November.

A Tesla press release notes that this latest collaboration with Panasonic would extend the established relationship between the two companies; Panasonic has been a key supplier of battery technology for Tesla’s EVs, and the companies have also teamed up on producing battery cells at Tesla’s Gigafactory, which is under construction near Reno, Nev.

In the release, JB Straubel, chief technical officer and co-founder of Tesla, said, “We are excited to expand our partnership with Panasonic as we move toward a combined Tesla and SolarCity. By working together on solar, we will be able to accelerate production of high-efficiency, extremely reliable solar cells and modules at the best cost.”

Shuuji Okayama, vice president of Panasonic’s Eco Solutions company, added, “Panasonic PV cells and modules boast industry-leading power generation performance and achieve high quality and reliability. We expect that the collaboration talks will lead to growth of the Tesla and Panasonic relationship.”

According to the Tesla release, the parties intend for Panasonic to begin production at the Buffalo facility, which is still under construction, in 2017. Tesla, in turn, intends to provide a long-term purchase commitment for the solar products from Panasonic for use in a solar energy system that the company says would work seamlessly with Teslas’ energy storage products, the Powerwall and Powerpack. The release suggests the partnership would also involve the solar installation, sales and financing capabilities of SolarCity. Elon Musk, who is both CEO of Tesla and chairman of SolarCity, recently called the integration of energy storage and solar part of his “master plan.”

Although the Tesla announcement does not offer many specifics about the Panasonic deal, including financial details and future ownership plans of the Buffalo factory, a Forbes report says Panasonic will “essentially operate” the plant “in conjunction with Tesla-SolarCity.”

After acquiring Silevo, SolarCity broke ground on the Buffalo facility in 2014 and originally planned on producing Silevo solar modules at the massive plant. A Buffalo News report says the factory received $750 million in state funding, and following delays, the plant is now expected to open by the end of the second quarter. Because it is slated to have a manufacturing output of more than 1 GW of capacity annually, the solar plant would become Tesla’s second so-called “Gigafactory.”

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