Panasonic’s Group CEO Yuki Kusumi has indicated that the company may delay the construction of a new electric vehicle plant in North America. This decision aligns with a broader trend of cooling demand for EVs in key markets, including the United States.

During an interview, Kusumi emphasized the importance of enhancing productivity within Panasonic’s battery division, known as Panasonic Energy. This focus on efficiency over expansion marks a departure from the company’s earlier plans to decide on a new factory location by the end of March.

Panasonic Energy currently operates a plant in Nevada and is in the process of establishing a second facility in Kansas. The Kansas plant is expected to increase Panasonic’s annual auto battery capacity to 80 gigawatt hours (GWh), with ambitions to reach 200 GWh by early 2031. Notably, Oklahoma, previously considered for a factory, is no longer in contention.

The CEO’s directive to the energy unit stresses maximizing output from existing investments before considering a third site. He highlighted the potential for increasing capacity through process improvements, such as enhanced machine maintenance. This strategy reflects a broader industry trend where automakers like General Motors and Ford have scaled back production plans due to dampened EV demand.

Furthermore, Kusumi outlined a vision for Panasonic Energy to achieve profitability independently of the U.S. Inflation Reduction Act (IRA). This legislation, along with other U.S. policies, has been instrumental in stimulating investments in a new electric vehicle plant by offering incentives for domestic production of EVs, batteries, and raw materials.

Panasonic’s strategic shift towards enhancing productivity rather than expanding its number of production sites reflects a cautious approach in a changing market landscape. As the EV sector continues to evolve, Panasonic’s focus on efficiency and profitability positions it to navigate these dynamic market conditions effectively.

Image Source: Panasonic Newsroom Global