Wednesday, February 26, 2014

Tesla, Panasonic in talks on $1 Billion Factory

Disclosure: Long $TSLA 

  By Mike Ramsey
Panasonic Corp., now the primary battery supplier for Tesla Motors Inc.'s $71,000-and-up electric cars, is in talks about investing in a nearly $1 billion battery factory in the U.S., according to Japanese business newspaper the Nikkei.
Panasonic said in a statement it was "considering various options to strengthen our ties" with Tesla (TSLA) .
Tesla shares hit a record high of $248 on Tuesday ahead of an expected announcement of the battery-production partnership, in which the company would carve out a business making advanced batteries for itself and others.
Panasonic shares were up 7% in early trading in Tokyo on Wednesday.
Tesla this week is expected to announce with corporate partners a plan to build a factory that would produce finished batteries from raw materials instead of components, lowering its costs.

Morgan Stanley auto analyst Adam Jonas said in a note on Tuesday the company "could become the world's largest producer of Li-ion batteries" based solely on its own automotive needs. He said Tesla could also supply batteries for energy storage for electric power suppliers.  

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