Tesla Gigafactory Investment Negatively Impacts Panasonic’s Q3 Results
Panasonic invested $1.6 billion into the Gigafactory
Despite overall revenues slightly increasing, the operating profit decreased by 15% to 95.2 billion JPY ($840 million) and net profits decreased by 20% to 56.2 billion JPY ($497 million).
- Overall sales increased, driven mainly by Energy and Automotive.
- Operating profit decreased , impacted from one-off income recorded in previous year, along with ramp-up expenses at automotive battery factory in North America, weakening investment demand in China, and sluggish sales of consumer electronics.
The Japanese manufacturer encourages that sales, operating profit, and net profit forecasts for the full year remain unchanged.
The total investment in 35 GWh lithium-ion cell production capacity at the Gigafactory apparently cost Panasonic some $1.6 billion or some $46 per kWh of installed capacity.
“Panasonic has been investing in Tesla’s battery plant as production of mass-market Model 3 cars accelerates. Its $1.6 billion investment to take production capacity to 35 gigawatt hours (GWh) is almost complete, but the business has yet contribute to profit.”
We are not sure how much net income Panasonic gest from each kWh of cell produced, but assuming $5 (or 5% out of $100/kWh on the cell level) it appears to be a long-term investment with a payback period of >10 years (including capital cost).
Panasonic results – Q3’2018 (Japanese FY 2018-Q2)