Japanese electronics company Panasonic [6752:JP] sold all its shareholdings of Tesla [TSLA:US] for approximately JPY400bn (USD3.6bn) by the end of March in 2021, as reported by Reuters on June 25, citing the company’s spokesman. As Tesla occupied the majority of its battery business, Panasonic explained that it intended to reduce dependence on Tesla. Through selling Tesla’s shares, the Japanese firm aimed to raise money for its development and new investments. In addition, Panasonic said that it had informed Tesla about the share selling, while the sale would not affect the partnership between the two parties.
Panasonic started providing batteries for Tesla’s Model S cars in 2009. Later, to enhance the partnership, Panasonic bought 1.4m shares of Tesla at USD21.15 per share in 2010, with a total cost of about JPY2.4bn (USD30m). At the end of March 2020, the stake was worth JPY80bn (USD730m). For a long time, Panasonic was the only battery supplier of Tesla, and the two firms jointly built the Gigafactory 1 in Nevada, US, to produce batteries in 2014.
However, the relationship between Tesla and Panasonic has deteriorated recently. Tesla’s CEO Elon Musk in April 2019 claimed that Panasonic’s battery supply limited the production capacity of Model 3 cars, which Panasonic denied later. Moreover, in 2019, the US electric vehicle (EV) maker signed deals with LG Chem [051910:KS] and Contemporary Amperex Technology (CATL) [300750:CH] for battery supplies of its Shanghai Gigafactory. Tesla also planned to build its own battery plant near its Shanghai factory. Since Tesla has been diversifying its battery supply chain, Panasonic also started seeking other partners and set up a battery joint venture with Toyota [TM:US] in 2020. Besides, Panasonic is investing in new businesses, as the company announced to buy the shares of the US supply chain software Blue Yonder for USD7.1bn earlier this year.