On Monday, the US electric auto maker Tesla has just said, via corporate blog, that it plans to begin collaborating with the Japanese electronics company, Panasonic Corporation. Tesla said that the two companies have signed a non-binding letter of intent to start working together on developing Panasonic’s photovoltaic cells and modules at a facility that is currently under construction in Buffalo, NY by the San Mateo, CA-based solar panel company, SolarCity Corp.
Panasonic Eco Solutions Company vice president Shuuji Okayama comments, “Panasonic PV cells and modules boast industry-leading power generation performance, and achieve high quality and reliability. We expect that the collaboration talks will lead to growth of the Tesla and Panasonic relationship.”
Accordingly, Tesla Chief Technical Officer J.B. Straubel, comments “We are excited to expand our partnership with Panasonic as we move towards a combined Tesla and SolarCity.”
The deal still requires approval from shareholders.
The collaboration is actually an extension of the partnership Tesla already has with Panasonic. For example, they are currently working on electric vehicle and grid storage battery cells at Tesla’s existing Gigafactory.
This may be a saving grace for SolarCity, which is currently cash-strapped and owes its current trajectory New York state taxpayers who are currently footing the bill on the $750 million construction and equipment costs of the new facility.
As such, New York consumer advocates worry that the factory will not succeed; after all, SolarCity has not actually invested—or even promised to invest—any money at all. According to non-profit Empire Center for Public Policy spokesman Kenneth Girardin, “SolarCity has no capital invested, it is just paying operating costs. What is to stop them from walking away?”
While the company may not have much invested, they certainly have much to lose. SolarCity has in excess of $3 billion in debt and has not turned any profits at all since the company went public in 2012. This year (through June) they spent $438 million, which is 42 percent more than the company’s revenue.
But the factory promises to create 500 new jobs internally, as well as nearly twice as many in the city of Buffalo, followed by another 2,000 jobs in the whole of New York state within the first five years of the factory’s operations.