MOUNTAIN VIEW, Calif., Feb. 26 (UPI) -- Tesla Motors teamed up with Japanese electronics company Panasonic to build a new battery plant, aiming to lower the costs of it cars with cheaper batteries.
The aim of the partnership is to make low-cost batteries, thereby making Tesla's cars available to a larger cross-section of consumers. The plant is slated to go into production in 2017 and will build the lithium-ion batteries from scratch -- everything from processing raw materials to assembly.
The plant will produce lightweight batteries for Tesla, and possibly for other car manufacturers like Toyota Motors. Panasonic has taken the lead in on-boarding other Japanese material suppliers, with a total projected investment of $965 million.
The Mountain View-based company plans to increase sales in 2014 by 55 percent to 35,000 vehicles, helped largely by the Model S. Tesla also plan to release a sport utility vehicle this year and another electric model in 2017.
At $70,000, the cheapest existing model is beyond the reach of many Americans. But if reduced battery costs can bring the price tag to around $35,000, it would help target a larger customer base.