Toyota Motor and Panasonic are set to launch a joint venture next year to produce batteries for electric vehicles (EV), Reuters reported.
The 51-49 joint venture between Toyota and Panasonic could also provide EV batteries to Toyota’s EV technology partners Mazda and Subaru.
Toyota and Panasonic in late 2017 announced a joint development of batteries with higher energy density in a prismatic cell arrangement.
Panasonic and Toyota spokespersons said the two companies have been working on the battery partnership announced in 2017 and declined to comment further.
The battery joint venture will help Toyota achieve an annual sales target of around 1 million zero-emission battery EVs and fuel-cell vehicles (FCVs) by 2030.
It will also give Panasonic cost and scale advantages in EV battery production at a time when China’s Contemporary Amperex Technology has grown to be on par with the long-time industry leader on the back of the growing home market.
Panasonic, the exclusive battery cell supplier for Tesla Inc’s current production models, could reduce its heavy reliance on the U.S. EV maker whose production delays previously weighed on the Japanese company’s earnings.
Panasonic is set to lose its exclusivity as Tesla plans to source cell production locally at a new auto plant in Shanghai, “most likely from several companies” including Panasonic, Elon Musk, Tesla chief executive, tweeted in November.
Under the planned joint venture, Panasonic would shift most of its prismatic battery-related equipment and facilities in Japan and China to the joint venture, while those producing batteries for Tesla will remain under the company.
Panasonic already makes prismatic batteries for Toyota, whereas for Tesla it makes cylindrical batteries of a type similar to those used in laptops.
It’s not clear yet how Panasonic would supply its prismatic batteries to other automotive clients, which include Honda Motor and Ford Motor.