Panasonic plans to build a new battery plant in De Soto, Kansas, a suburb of Kansas City. The new facility will primarily supply batteries to Tesla, but will also have a research department focused on next-generation battery tech.

The company has made no official announcement of the planned production capacity or investment amount.

The Kansas state legislature approved an incentive package worth up to $1 billion earlier this year. The Kansas Department of Commerce said the state will reimburse Panasonic with estimated subsidies of $829 million after the company has completed investment and hiring, and estimates that the plant will deliver $2.5 billion in annual economic activity.

Reuters reports that Panasonic plans to expand battery production capacity by three to four times by 2029, with most of the increase in North America.

“With the increased electrification of the automotive market, expanding battery production in the United States is critical to help meet demand,” said Panasonic Energy President Kazuo Tadanobu.

The Biden administration is taking measures aimed at reducing reliance on Asia for EV batteries and materials—President Joe Biden talked with Panasonic executives in May on a visit to Japan.

According to Reuters, China’s Contemporary Amperex Technology (CATL) has also been scouting sites for US battery factories, and South Korean battery-makers have announced investment plans of $5.5 billion this year in US plants.

Source: Reuters