Toyota and Panasonic have confirmed that they are starting a wide-ranging new battery joint-venture to manufacture and sell battery cells for electric vehicles.

The fact that the two Japanese companies reached an agreement leaked yesterday, but they have released all the details today.

Toyota Executive Vice President Shigeki Terashi said:

“Together with Panasonic, we want to hone our competitiveness in batteries, which represent one of the core technologies of electrified vehicles. By contributing to the popularization of Toyota’s and other automakers’ electrified vehicles, we want to help find solutions to issues such as global warming, environment-related challenges, and energy-related challenges. We have high expectations for the new company, including―as we aim to deliver ever-better electrified vehicles to even more customers―its role in fulfilling our plans for the popularization of electrified vehicles* (including achieving Toyota annual global sales of more than 5.5 million units of electrified vehicles), which we announced at the end of 2017.”

The automaker is still talking about “electrified vehicles”, which includes hybrids and not all-electric vehicles.

Panasonic Senior Managing Executive Officer Masahisa Shibata also commented on the announcement:

“Uniting with Toyota’s battery and production-engineering technologies provides us an excellent opportunity for being able to evolve our automotive prismatic batteries, which have an established track record of performance and safety, faster than ever. Through the electrification of vehicles, we want to accelerate our contribution to the realization of a society of mobility that is kind to the environment.”

Panasonic’s EV battery production is currently mainly going to Tesla, but the automaker only buys cylindrical cells.

The deal is for prismatic cells, which is used by virtually every other automakers.

Here are the main points of the agreement between the two companies:

  • Toyota and Panasonic will establish a joint venture (pending approval from the competition-law authorities in the countries and regions concerned) by the end of 2020.
  • The ratio of equity participation in the joint venture will be 51 percent for Toyota and 49 percent for Panasonic.
  • The scope of the joint venture’s business operations will cover research, development, production engineering, manufacturing, procurement, order receipt, and management related to automotive prismatic lithium-ion batteries, solid-state batteries, and next-generation batteries.
  • Toyota will transfer equipment and personnel to the joint venture in the areas of development and production engineering related to battery cells. Panasonic will transfer equipment, other assets, liabilities, personnel, and other items to the joint venture in the areas of development, production engineering, manufacturing (at plants in Japan and in Dalian, China), procurement, order receipt, and management functions related to the automotive prismatic battery business.
  • The total number of employees from both companies related to operations subject to transfer to the joint venture is 3,500 (as of the end of December 2018).
  • Products produced by the joint venture will be sold to various automakers through, in principle, Panasonic.


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