Gigafactory will be profitable for Panasonic "at a very early stage."

Panasonic turned attention on itself when it said that ramp-up expenses at the automotive battery factory in North America (Tesla Gigafactory) lowered its financial results in the third quarter.

Now, Panasonic President Kazuhiro Tsuga encourages that profits on battery production for Tesla Model 3 are just around the corner, while local production in Japan (for Model S and Model X) is already profitable (probably for a long time now we'd guess).

"“We will be in a position to deliver profits at a very early stage,” Tsuga said, declining to specify a timeline. “There is no doubt about it, once we complete the current build-up.”"

Tesla Gigafactory will be ready to crank out 35 GWh of cells using 13 production lines by the end of this year (two more need to be launched). The total costs on Panasonic's side is to exceed 200 billion yen ($1.8 billion). That gives us the number of more than $51/kWh of installed annual production capacity.

"“Once things settle down, you can control profit on line-by-line basis,” he said. “The first 10 lines are pretty much already there.”"

According to Panasonic Chief Financial Officer Hirokazu Umeda, company operations will begin to contribute to profit from this quarter.

Panasonic finally will be able to produce enough battery cells to not slow Tesla's production of cars too. The 35 GWh should last for almost 440,000 cars (assuming 80 kWh batteries) to 700,000 cars (assuming 50 kWh batteries). Energy storage production currently stands at around 1 GWh annually.

Source: Bloomberg via Yahoo