Panasonic Energy, a key supplier for Tesla, is working to reduce its reliance on China for electric vehicle battery production in the United States, according to a senior executive's statement to Reuters, describing this transition as a top priority.
Allan Swan, President of Panasonic Energy of North America, emphasized that the incoming U.S. administration's commitment to increasing tariffs on Chinese imports has prompted global companies to reevaluate their manufacturing strategies.
As a subsidiary of the Japanese electronics firm Panasonic, Panasonic Energy provides batteries to Tesla and various other automotive manufacturers.
President Trump has announced plans to implement a 10% tariff on all global imports to the U.S., alongside a significant 60% tariff specifically targeting Chinese products. He also indicated intentions to impose a 25% tariff on imports from Canada and Mexico upon taking office on January 20.
In an interview at the CES trade show in Las Vegas, Swan stated that the primary action for the business in light of Trump's tariff proposals is to "not have the supply chain dedicated from China." He noted that while some materials are sourced from China, the company is actively working to reduce this dependency.
Swan mentioned that most of the raw materials for the batteries produced in the U.S. are sourced from international suppliers, including those in Canada.
Recent reports indicated that Trump's transition team suggested imposing tariffs on battery materials worldwide. However, The Washington Post later revealed that his aides were considering more targeted tariff strategies for essential imports, a claim Trump subsequently refuted.
Panasonic Energy currently operates a manufacturing facility in Nevada and is set to establish a second plant in Kansas this year.
Swan outlined a "three-pronged strategy" for reshaping the supply chain, which includes not only engaging U.S. suppliers but also assisting some Japanese and Korean suppliers in establishing operations in the U.S., as well as collaborating with those already planning to enter the market.
"That's our main focus about building the American supply chain," Swan said. "We have set some quite strong targets about what we want to achieve."
Japanese companies are preparing for the uncertainties associated with a potential second Trump presidency, particularly regarding his trade policies.
Automakers such as Nissan and Honda have indicated that U.S. tariffs on Mexico, which serves as a cost-effective production and export center for the American market, could have significant repercussions. Additionally, heavy machinery manufacturer Komatsu recently described a possible trade conflict between the U.S. and Canada as a "one-two punch" that could adversely affect its mining equipment sector.