[News] Panasonic’s Delayed U.S. EV Battery Plant Reportedly Set for July Production Amid China Material Control

According to a report from Nikkei, production at Panasonic Holdings’ second U.S. battery plant in Kansas—originally scheduled to begin by March—could now start as early as July. However, built to supply Tesla, the facility remains subject to uncertainty due to potential tariff impacts under President Trump, the report notes.

Sources from the company cited in the report indicate the plant is currently undergoing production verification and working with customers to finalize preparations for mass production in the first half of fiscal 2026. The company’s 2026 fiscal year ends next March, the report adds. Panasonic has declined to provide a definitive timeline for when operations will officially begin, the report adds.

Tariffs Potentially Adding Cost for Battery Equipment Sourced from Japan

One factor contributing to uncertainty around the plant’s timeline, the report notes, is the cost of battery manufacturing equipment, most of which is shipped from Japan. This has been impacted by a 24% reciprocal tariff imposed by President Trump—though the tariff is currently suspended until early July.

Supply Chain Risk: China’s Grip on Battery Materials

In addition, the report highlights that a significant portion of Panasonic’s battery materials is sourced from outside the U.S. As the report points out, battery materials like graphite are mostly processed in China and shipped to the U.S., making them vulnerable to U.S.-China tensions.

This reflects a broader challenge across the EV battery industry. For example, the report mentions that building a domestic anode material supply chain remains LG Energy Solution’s biggest challenge in U.S. EV battery production. According to Business Korea, Chinese companies held a dominant 95% share of the global anode material market in January and February 2025. Anode materials are essential components of lithium-ion batteries used in electric vehicles, the report highlights.

This is Panasonic’s second U.S. EV battery plant, and the company has paused plans for a third facility, the report notes.

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(Photo credit: Panasonic)