After Tesla Partnership, Panasonic plans to supply EV batteries to Subaru

The deal- Panasonic has announced a partnership with Subaru to provide batteries, after being the main supplier of EV batteries to Tesla. The two Japanese companies have signed a memorandum of understanding to jointly develop and supply high-performance prismatic batteries for Subaru’s new electric vehicles.

The batteries will be based on Panasonic’s 4680 cells, which are expected to start shipping in 2024. These cells offer higher energy density, faster charging, and better thermal management than the previous 2170 cells.

Subaru’s electrification strategy

Subaru plans to launch its first all-electric SUV, the Solterra, in 2022, followed by two more electric models by 2026. The Solterra will use batteries from Toyota, which is a major shareholder of Subaru.

Subaru aims to electrify its entire lineup by 2030, with at least 40% of its global sales coming from electric or hybrid vehicles. Subaru is known for its boxer engines and all-wheel-drive systems, which it hopes to integrate with its electric powertrains.

Panasonic’s global expansion

Panasonic is seeking to increase its global market share in EV batteries as it faces rising competition from Chinese and South Korean rivals. Panasonic Energy, its battery unit, aims to boost its revenue from automotive batteries to 2.5 trillion yen ($17.9 billion) in the fiscal year ending March 2031, up from 660 billion yen in the fiscal year ended March 2023.

Panasonic is expanding its EV battery production capacity mainly in North America, where it operates a joint battery plant with Tesla in Nevada and is constructing another one in Kansas. Panasonic Energy says it will decide on building a third plant, either in the U.S. or Canada, by March 2024.

Panasonic ranked fourth in the world in automotive battery market share by capacity in 2022, with 7.7%, according to Techno Systems Research, a Tokyo-based research firm. It dropped one spot from 2021 due to competition from players such as CATL of China.