Panasonic says it has resolved a labour shortage that has hampered production efficiency at the “gigafactory” in Nevada, its joint-venture electric battery plant with Tesla.
The Japanese company made a $1.6bn investment in the $5bn plant to become the exclusive supplier of lithium-ion electric battery cells for Tesla’s Model 3 car.
But the gigafactory has struggled to raise its production yields since it launched in 2017. Originally designed to be able to produce the equivalent of 54 gigawatt hours a year, it is only now finally nearing 30GWH.
Panasonic said it has faced an industry-wide shortage of battery engineers after a construction boom in lithium ion battery megafactories to address the shift towards electric vehicles.
“Even today, demand is far outstripping supply when it comes to chemical engineers with lithiumion experience,” said Allan Swan, the head of Panasonic’s US battery manufacturing unit based inside the gigafactory, in an interview.
To build its team, Panasonic recruited chemical engineers from non-battery sectors and trained them to handle lithium-ion batteries. Now it has 3,000 people who operate the machinery and about 200 technical assistants from Japan to keep the plant running 24 hours a day, 365 days a year.
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“For us to move to [54GWH] should not be so hard. We now have the knowhow to do it in quite a high volume environment,” said Mr Swan.
Securing engineers is a critical step as Tesla plans to use batteries produced at the US gigafactory for its Model Y sport utility vehicle when it launches next summer, according to people with knowledge of the plan.
Panasonic declined to comment on battery plans for Model Y. Tesla could not be reached for comment.
The skills gap in engineers was one of many problems that led the Tesla chief executive, Elon Musk, to blame his Japanese partner for constraining Model 3 production in April.
But whether the Japanese company, whose $1.6bn commitment only covers capacity to 35GWH, will make an additional investment is far from certain. In November, Kazuhiro Tsuga, its chief executive, said the company’s focus was in reaching the 35GWH target and that it had no plans to build a new battery plant for Tesla in China even despite the US company’s deepening relationship with local battery producers.
Part of the frustration for Panasonic has been the mismatch between sales of Tesla electric vehicles and Mr Musk’s aggressive plans to build new plants in China and Germany, according to people close to the Japanese group.
In addition to the capacity at Gigafactory 1, declining sales of Model S and Model X vehicles mean that Panasonic could also use production lines at its plant in Osaka without making investments in new factories.
Mr Swan played down perceived tensions between the two companies, saying there was no barrier between the two teams working inside the gigafactory. “Our whole job is to make sure that Tesla wins,” Mr Swan said. “If Tesla wins, Panasonic wins.”
