Japanese electronics giant Panasonic will partner with U.S. car maker Tesla to build its battery factory, but has refused to divulge details of the plan.
Panasonic said Thursday it will invest an undisclosed amount in the "Gigafactory" that will be used to purchase equipment, machinery and other tools for the plant, which Tesla estimates will cost $4 billion to $5 billion. Tesla hope to build the factory to supply batteries for its expansion plan that include manufacturing the Model 3, which is expected in three years.
"We haven't decided yet on the specifics of when or how much investment we will be making," said Panasonic Chief Financial Officer Hideaki Kawai.
"The Gigafactory represents a fundamental change," said J.B. Straubel, Tesla's chief technical officer. "Not only does the Gigafactory enable capacity needed for the Model 3, but it sets the path for a dramatic reduction in the cost of energy storage across a broad range of applications."
Panasonic and Tesla signed a letter of intent in May and Thursday's announcement is seen as the next step in this partnership. Tesla already has an agreement with the Japanese company to provide two billion battery cells through 2017.
Tesla is yet to announce the location of its "Gigafactory" but the shortlisted U.S. states have already started attempts to attract the car maker. The shortlist includes California, Nevada, Arizona, New Mexico and Texas.