Friday, September 28, 2018

Meanwhile In Nevada: "Panasonic completing 3 new cell production lines at Tesla’s Gigafactory"

I don't know how the Panasonic higher-ups are taking all the Tesla drama but I imagine we'll soon learn how to say "What the Hell, Elon?" in Japanese.

From Ars Technica, Sept. 26:

More battery cells may not smooth out other bottlenecks in Model 3 production.
In a Tuesday interview with Bloomberg, the head of Panasonic's Automotive Division said that the company was on track to complete an additional three battery-cell production lines at Tesla's Nevada Gigafactory before the end of this year. That puts the expansion ahead of schedule for completion.
Panasonic is a joint owner of the Gigafactory. The company provides the "2170" battery cells that go into a Model 3 battery pack. Tesla packages those cells to complete the pack.
In the interview, Panasonic automotive executive Yoshio Ito told Bloomberg that "the bottleneck for Model 3 production has been our batteries."
Ito added, "they just want us to make as many as possible."

In truth, bottlenecks around Model 3 development have popped up everywhere along the line, so if they exist in a lack of battery-cell supply (which Panasonic executives have previously alluded to), they are not exclusive to that domain. For example, in January, Ars wrote about a bottleneck that had existed in December 2017 when "Tesla and Panasonic workers were manually assembling bandoliers, rows of lithium-ion cells glued on either side of a cooling tube." That bottleneck has reportedly been sorted out with improved robotics. Bottlenecks have been reported on Tesla's Model 3 factory lines in Fremont, as well.

Tesla claimed in April that some of its bottlenecks were smoothed out by equipment upgrades on its factory lines. Musk has also blamed bottlenecks on over-automation, as well as over-generalization of the manufacturing process.

In short, more battery cells rolling off more lines at the Gigafactory are good for Model 3 production only if the manufacturing process gets smoother. There's evidence that this is happening, as the company was able to sell more than 28,000 Model 3s in the second quarter of 2018, albeit at the slight expense of Model S and Model X production....

We may also learn more than we ever wanted to know about the liens and covenants in Tesla's debt.
Tesla Credit Default Swaps Imply Default Probability At A Record 48%

Panasonic's US ADR's (PCRFY) are trading down 2.34% (-0.277) at $11.58 after the stock declined 1.01% to 1,323.50JPY in Tokyo (6752:JP).