Panasonic Foots $255m Bill For New Tesla Solar Panel Plant

Tesla and Panasonic will build solar panels together in a Buffalo, New York factory the two have agreed today, with Panasonic pumping more than $255m into the venture. The deal, which is expected to see production kick off in the summer of 2017, marks a deepening of the business relationship between the two companies as the ambitions of each expands. Panasonic already supplies the lithium-ion batteries that Tesla uses in the Model S and Model X electric cars, for instance.

Panasonic is also expected to be the primary supplier of batteries for the Model 3, the upcoming smaller car from Tesla. Production of that is due to kick off in late 2017, and be the automaker's most affordable model. Pre-registrations for the car already number in the hundreds of thousands, though Tesla is yet to open full ordering or, indeed, detail exactly how much each model will cost.

In the meantime, shareholders recently agreed to a plan to merge Tesla and SolarCity, Elon Musk's business developing residential and commercial solar panels. The deal with Panasonic will eventually see the solar cells being produced in the New York factory integrated into the solar glass tile roofs Tesla and SolarCity intend to manufacture. They'll look far more like regular roof tiles, Musk has promised, as well as being more efficient than other solar systems.

Before that, though, the photovoltaic cells and modules will be used for non-solar roof products, Panasonic says. Although the first examples will arrive next year, it'll be 2019 by the time the production line ramps to 1 Gigawatt of module production. At the same time, the two companies plan to collaborate on next-generation tech.

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That'll include newer, more efficient, and more flexible photovoltaic cells and panels. The research will take place at SolarCity's facility in Fremont, California. In Buffalo, over 1,400 jobs are expected to be created, with more than 500 of those in manufacturing.

Panasonic will foot the bill for the capital costs in setting up the new Buffalo facility, expected to cost more than 30 billion yen or around $255m. Tesla has committed to a long-term purchase agreement in response. As well as providing energy storage in Tesla's cars, the Panasonic batteries are also used in the company's Powerwall energy storage systems; most recently, the Powerwall 2 was announced, promising sufficient capacity to run a typical two-bedroom home for a full day.