Panasonic posts first quarterly profit in US battery business with Tesla

TOKYO: Panasonic Corp reported the first quarterly profit in its US battery business with Tesla Inc yesterday, after several years of production troubles and delays at the US partner.

The news comes after the US electric vehicle maker reported its second successive quarterly profit last week, as vehicle deliveries hit a record. Tesla also said it would comfortably make more than half a million units this year, pushing its shares to new highs.

“We are catching up as Tesla is quickly expanding production,” Panasonic CFO Hirokazu Umeda told an earnings briefing, referring to battery cell production. “Higher production volume is helping to push down materials costs and erase losses.”

Panasonic first invested in Tesla in 2010 and announced its partnership in building the US firm’s Gigafactory plant in Nevada in 2014 as part of its strategic shift from low-margin consumer electronics to automotive components. But as its US$1.6 billion Gigafactory investment failed to produce solid returns, Panasonic has grown cautious about its battery business with Tesla.

Panasonic said operating profit for the October-December quarter rose 3% to ¥100.4 billion (RM3.8 billion). It maintained its profit forecast for the year through March at ¥300 billion.

Meanwhile, Panasonic and Toyota Motor Corp and have agreed to set up a joint venture that will begin developing electric vehicle batteries from April.

The new company, called Prime Planet Energy and Solutions, will develop prismatic – or squareshaped – batteries that will be available to any automaker, the two companies said in a statement yesterday. – Reuters