If the dominoes fall correctly, pretty soon, Tesla Motors will be able to produce affordable electric vehicles like the $35,000 Model 3 en masse. First, though, it needs a way to produce large quantities of the lithium-ion batteries that power its cars. Enter the Gigafactory.
Today, Tesla announced that it had secured a key partnership with Panasonic, which, in addition to investing in equipment and manufacturing tools, will supply the electric car-maker with the low-cost batteries cars like the top-rated Model S need.
"The Gigafactory represents a fundamental change," JB Straubel, Tesla's chief technical officer, said in a statement. "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."
Although a location for the factory site is not yet specified, the company is still looking for a state to break ground in. Finalists so far include California, Nevada, Arizona, New Mexico, and Texas. Tesla projects that, by the year 2020, the Gigafactory will employ 6,500 people and produce batteries for 500,000 cars every year.