TOKYO (Reuters) – A recording in the production of Tesla Inc. ( TSLA.O ) Model 3 cars, after earlier delays, has led to occasional battery cell shortages, a Panasonic Corp. ( 6752 ) .T ) said the official on Thursday in a sign Tesla is in overdrive to meet its June end forecast.
Silicon Valley Tech billionaire and Tesla Chief Executive Elon Musk at the beginning of this month reach 5,000 cars per week, making some Wall Street analysts skeptical.
Yoshio Ito, head of Panasonic's automotive business, said at the company's annual general meeting on Thursday that there had been a "strong improvement in production" that led to occasional battery (cell) bottlenecks.
Panasonic is the exclusive manufacturer of battery cells for Tesla's current production models and produces them in Japan as well as in Tesla's so-called Gigafactory in the US state of Nevada, which Panasonic jointly operates.
There is also a joint factory with Tesla to produce solar cells and modules at a new factory in Buffalo, New York.
But tying his assets to Tesla, which had to cope with production bottlenecks, sometimes looked like a risky bet.
A California fatal accident earlier this year with a Tesla car and another in Florida last year has put pressure on regulators and damaged the stock.
Tesla said earlier this month that it would eliminate several thousand jobs in the company as it seeks to cut costs and become profitable without jeopardizing the critical increase in production of the sedan, a closely monitored measure.
"I would not say that the delay (in Tesla's Model 3 production) had no impact on our business, but we are in close contact with Tesla and working to improve production steadily," said Ito.
Panasonic sees batteries as a key part of its plan to raise revenue from the auto business to 1.8 trillion yen ($ 16.3 billion) in March 2022, up to 2.5 trillion yen.
To reduce the risk of overuse of Tesla, Panasonic has partnered with Toyota Motor Corp. ( 7203.T ) teamed up to jointly develop batteries for electric vehicles.
At the AGM, Panasonic CEO Kazuhiro Tsuga said all solid-state batteries, which are considered more stable batteries, are unlikely to hit the auto market in the near future, even though the company was involved in their development.
"We believe that we can continue to improve the performance of today's lithium-ion batteries until at least 2025," Tsuga said. The commercialization of all solid-state batteries would come after this progress, he said.
Toyota wants to bring solid-state batteries to the market by the beginning of the 2020s.
Reporting by Makiko Yamazaki, Letter from Sayantani Ghosh; Arrangement by Stephen Coates