Nikkei: Panasonic, Tesla In Talks To Build Auto Battery Plant In U.S.

(RTTNews) - Japanese consumer electronics giant Panasonic Corp. (PCFRY) and U.S. electric car maker Tesla Motors, Inc. (TSLA) are in talks to build an automotive battery plant in the U.S., the Nikkei business daily reported Tuesday.

According to the Nikkei report, the lithium-ion battery plant is targeted to go onstream in 2017 and will handle everything from processing raw materials to assembly. Panasonic is said to have invited Japanese materials makers to invest in the facility, with total investment reportedly expected to reach more than 100 billion yen, or $965 million.

Panasonic and Tesla reportedly aim to lower manufacturing costs through mass production. Lower battery prices are expected to make electric vehicles more affordable. With the new battery facility, Tesla plans to bring down the prices of electric vehicles in line with the prices of gasoline-burning vehicles.

The Nikkei reported that the plant will produce small, lightweight batteries for Tesla, but these batteries may also be supplied to Toyota Motor Corp.(TM) as well as other automakers. Tesla is partly owned by Toyota and Panasonic.

Palo Alto, California-based Tesla Motors rose to fame by producing the Tesla Roadster, the first fully electric sports car, followed by the Model S, a fully electric luxury sedan.

Last Wednesday, Tesla reported a loss for the fourth quarter that narrowed sharply from last year, as revenue more than doubled amid strong sales of its Model S vehicles. Tesla also said it expects to deliver over 35,000 Model S vehicles in 2014, representing a 55 percent increase over 2013.

Panasonic, in early February 2014, reported an increase in profit for the third quarter on higher sales. In October 2013, Panasonic had lifted its annual forecast, projecting fiscal 2014 net income attributable to the company of 43.26 yen per share and sales of 7.40 trillion yen.

Media reports in early October 2013 indicated that Panasonic decided to stop production of plasma television panels by the end of the current fiscal year in March 2014 and fully exit the business. Panasonic's plasma television segment had contributed to two straight years of net losses exceeding 750 billion yen through the fiscal year ended March 2013.

TSLA closed Tuesday's trading at $248.00, up $30.35 or 13.94 percent on a volume of 32.80 million shares. In after-hours, the stock further gained $4.70 or 1.9 percent to $252.70.

PCFRY closed Tuesday's trading at $12.12, up $0.37 or 3.10 percent on a volume of 532,261 shares.