According to media reports quoting sources, a joint venture for the manufacturing of batteries for electric vehicles (EV) is all set to be announced by Toyota Motor Corp and Panasonic Corp which would start functioning next year with the aim of rivalling the Chinese makers of EV batteries.
According to sources quoted in the media, 51 per cent of the joint venture would be owned by Toyota while the rest by Panasonic and it could also provide batteries to Toyota’s EV technology partners Mazda Corp and Subaru Corp.
The agreement that the two companies had struck in late 2017 which was based on development of batteries with higher energy density in a prismatic cell arrangement would form the basis of the joint venture.
While declining to elaborate, a spokesperson for Toyota said that the two companies have been closely cooperating in the partnership as was announced in 2017. Same comments were made to the media by Panasonic.
Reports also predicted that the joint venture could be announced by the two companies later this week.
According to estimates, Toyota would be able to sell about 1 million zero-emission battery EVs and fuel-cell vehicles (FCVs) by 2030 after the formation of the joint venture for manufacturing batteries. .
In recent years, China’s Contemporary Amperex Technology has grown as much to catch up and compete with Panasonic, the long-time industry leader in batteries primarily driven by very fast growing demand in China and the joint venture would help Panasonic be able to compete with its Chinese rival because it would offer cost and scale advantages in battery production.
Currently, the exclusive battery supplier for the current electric vehicle models of Tesla is Panasonic. The joint venture would also help the Japanese firm to bring down its dependency of the US electric car maker as the company’s earnings have been impacted by the repeated production delays of Tesla.
But according to a tweet made by Tesla CEO Elon Musk in November, the company has drawn up plans to get batteries for its electric vehicles at the production unit that is coming up in a new auto plant in Shanghai “most likely from several companies”. This would bring an end to the exclusivity that Panasonic currently enjoys with Tesla.
The news of the possibility of the joint venture saw Panasonic shares rise as much as 4 per cent while shares of Toyota were almost flat.
Most of the prismatic battery-related equipment and facilities in Japan and China would be transferred to the joint venture by Panasonic under the joint venture agreement but those that are engaged in production of batteries for Tesla would be retained by the company according to reports.
While Panasonic makes cylindrical batteries of a type similar to those used in laptops for Tesla, it makes prismatic batteries for Toyota.
The reports did not however specify how prismatic batteries would be supplied to the other automotive clients of Panasonic such as Honda Motor and Ford Motor.
(Adapted from JapanDaily.com)