• 259 days Will The ECB Continue To Hike Rates?
  • 259 days Forbes: Aramco Remains Largest Company In The Middle East
  • 261 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 661 days Could Crypto Overtake Traditional Investment?
  • 665 days Americans Still Quitting Jobs At Record Pace
  • 667 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 670 days Is The Dollar Too Strong?
  • 671 days Big Tech Disappoints Investors on Earnings Calls
  • 672 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 673 days China Is Quietly Trying To Distance Itself From Russia
  • 674 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 678 days Crypto Investors Won Big In 2021
  • 678 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 679 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 681 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 681 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 685 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 685 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 686 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 688 days Are NFTs About To Take Over Gaming?
  1. Home
  2. News
  3. Breaking News

Tesla's Cash Burn Puts Panasonic On Edge

Gigafactory

Panasonic is getting increasingly worried about its partner Tesla’s production-riddled, cash-burning ways, and may be less willing to make further commitments to the U.S. company beyond what it has already pledged for the Nevada gigafactory, Panasonic executives told the Nikkei Asian Review.

Tesla and Panasonic are partners in the gigafactory with the Japanese electronics giant committing some US$1.82 billion (200 billion yen) to the US$5-billion project until 2020. After that, however, Panasonic is not yet certain how much more it will commit. The decision, according to the executives, will be “based on a frank assessment of the situation.”

Panasonic is also wary of making any definitive comments regarding plans for a second gigafactory, to be located in China, in which Tesla assumes it will again partner with the Japanese company. However, following a first-quarter conference call that many called bizarre on the part of CEO Elon Musk, Panasonic executives made a point of noting that “nothing is set in stone” and nothing is “solidified yet.”

Tesla reported a record-high operating loss for the first quarter despite equally record-high revenues. Yet the financial and production performance of the EV maker is not the only reason Panasonic is wary of committing billions to the gigafactories. Related: Asian Markets Up On High Oil Prices And Weak Dollar

Another reason, according to the Nikkei Asian Review, is its scar from plasma displays. The company splashed US$4.57 billion (500 billion yen) on plasma display factories only to be forced to shut down the business when LCD displays emerged as the clear winner of this particular competition.

What’s more, in its EV battery business, Panasonic is facing growing competition from Chinese companies and will need to direct substantial resources to this fight. On the one hand, an exclusive partnership with Tesla could benefit the Japanese electronics maker, but on the other, the Chinese rivals are closing partnerships with many carmakers eager to expand in the EV market.

By Irina Slav for Oilprice.com

More Top Reads From Safehaven.com:

Back to homepage

Leave a comment

Leave a comment