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Tesla (TSLA) & Panasonic Ink Deal for Cell Production Unit
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Tesla’s (TSLA - Free Report) major battery supplier, Panasonic , is set to build and operate the world's largest battery cell production facility in Kansas.
The Panasonic plant will primarily supply batteries to Tesla but is not limited to the company. PCRFY will also have a research department focused on next-generation batteries.
The plant is expected to be built in De Soto, a former ammunition factory on the western fringe of Kansas’ metropolitan area.
Tesla has been the major driver in Panasonic’s boom in the EV space through an age-long partnership.
In the early 2000s, Tesla proposed the idea of using Li-ion cylindrical battery cells to every battery manufacturer in the world for powering electric vehicles.
Except for Panasonic, all the others had declined the offer. That propelled PCRFY into the EV domain, and eventually, it became a top supplier in the industry.
Since then, the two companies have been sharing technology and working on battery chemistry to improve performance and cost. Gigafactory Nevada has been a major joint project in which Panasonic produces battery cells under Tesla’s roof.
The latest investment marks the most significant private investment in the history of Kansas and one of the largest EV battery manufacturing plants of its kind in the country. The project, with an aim to provide 8,000 high-quality jobs, seeks to transform the quality of life in Kansas. An estimated $2.5 billion in annual economic activity is expected.
By 2029, Panasonic plans to expand battery production capacity by three to four times, with most of the increase in North America.
Tesla chief, Elon Musk, said that the EV maker faced challenges in ramping up production of its in-house batteries, contributing to limited auto output. The deal with Panasonic will cater to the cause.
Panasonic is also working on new technology to increase battery energy density by 2030. It intends to supply Tesla with a larger battery known as the 4680 model, starting with production in Japan in its next fiscal year. If successful, it could boost the driving range of Model Y. Tesla plans to use 4680 batteries for powering the new Texas-built Model Y cars.
Shares of TSLA have gained 9.3% over the past year against its industry’s 12% decline.
BorgWarner has an expected earnings growth rate of 23% for 2023. The Zacks Consensus Estimate for current-year earnings has been revised 0.3% upward in the past 30 days.
BorgWarner’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters. BWA pulled off a trailing four-quarter earnings surprise of 33.1%, on average. The stock has declined 28.9% over the past year.
Standard Motor has an expected earnings growth rate of 5.2% for the current year. The Zacks Consensus Estimate for current-year earnings has remained constant in the past 30 days.
Standard Motor’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters. SMP pulled off a trailing four-quarter earnings surprise of 40.34%, on average. The stock has risen 4.1% over the past year.
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Tesla (TSLA) & Panasonic Ink Deal for Cell Production Unit
Tesla’s (TSLA - Free Report) major battery supplier, Panasonic , is set to build and operate the world's largest battery cell production facility in Kansas.
The Panasonic plant will primarily supply batteries to Tesla but is not limited to the company. PCRFY will also have a research department focused on next-generation batteries.
The plant is expected to be built in De Soto, a former ammunition factory on the western fringe of Kansas’ metropolitan area.
Tesla has been the major driver in Panasonic’s boom in the EV space through an age-long partnership.
In the early 2000s, Tesla proposed the idea of using Li-ion cylindrical battery cells to every battery manufacturer in the world for powering electric vehicles.
Except for Panasonic, all the others had declined the offer. That propelled PCRFY into the EV domain, and eventually, it became a top supplier in the industry.
Since then, the two companies have been sharing technology and working on battery chemistry to improve performance and cost. Gigafactory Nevada has been a major joint project in which Panasonic produces battery cells under Tesla’s roof.
The latest investment marks the most significant private investment in the history of Kansas and one of the largest EV battery manufacturing plants of its kind in the country. The project, with an aim to provide 8,000 high-quality jobs, seeks to transform the quality of life in Kansas. An estimated $2.5 billion in annual economic activity is expected.
By 2029, Panasonic plans to expand battery production capacity by three to four times, with most of the increase in North America.
Tesla chief, Elon Musk, said that the EV maker faced challenges in ramping up production of its in-house batteries, contributing to limited auto output. The deal with Panasonic will cater to the cause.
Panasonic is also working on new technology to increase battery energy density by 2030. It intends to supply Tesla with a larger battery known as the 4680 model, starting with production in Japan in its next fiscal year. If successful, it could boost the driving range of Model Y. Tesla plans to use 4680 batteries for powering the new Texas-built Model Y cars.
Shares of TSLA have gained 9.3% over the past year against its industry’s 12% decline.
Image Source: Zacks Investment Research
Zacks Rank & Key Picks
TSLA carries a Zacks Rank #3 (Hold), currently.
Better-ranked players in the auto space include BorgWarner (BWA - Free Report) and Standard Motor Products (SMP - Free Report) , each carrying a Zacks Rank #2 (Buy), currently. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
BorgWarner has an expected earnings growth rate of 23% for 2023. The Zacks Consensus Estimate for current-year earnings has been revised 0.3% upward in the past 30 days.
BorgWarner’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters. BWA pulled off a trailing four-quarter earnings surprise of 33.1%, on average. The stock has declined 28.9% over the past year.
Standard Motor has an expected earnings growth rate of 5.2% for the current year. The Zacks Consensus Estimate for current-year earnings has remained constant in the past 30 days.
Standard Motor’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters. SMP pulled off a trailing four-quarter earnings surprise of 40.34%, on average. The stock has risen 4.1% over the past year.