8-KMaterial AgreementsExhibits & Filings

Tesla, Inc. 8-K Report, Material Agreement (Aug 1, 2014)

Filed August 1, 2014For Securities:TSLA

Summary

This Form 8-K filing by Tesla Motors, Inc. (TSLA) on July 31, 2014, details a significant material definitive agreement entered into with Panasonic Corporation concerning the development and operation of Tesla's planned Gigafactory. This agreement solidifies Panasonic's role as a key partner, committing them to manufacture and supply lithium-ion battery cells at the Gigafactory and invest in related manufacturing equipment. For investors, this partnership is crucial as it underscores the strategic commitment to securing a stable and cost-effective supply chain for battery production, a core component of Tesla's vehicle manufacturing. The agreement outlines a division of responsibilities, with Panasonic focused on cell production and Tesla on facility provision and final battery pack assembly. This collaboration, building on a prior supply agreement, signals a deepened relationship aimed at scaling Tesla's production capacity and achieving economies of scale for battery technology.

Key Highlights

  • 1Tesla entered into a material definitive agreement with Panasonic Corporation regarding the Gigafactory.
  • 2Panasonic will manufacture and supply lithium-ion battery cells at the Gigafactory and invest in manufacturing equipment.
  • 3Tesla will provide the necessary facilities for Panasonic's activities at the Gigafactory.
  • 4Tesla will assemble battery modules and packs at the Gigafactory using cells and components from various suppliers.
  • 5The agreement builds upon the existing Supply Agreement between Tesla and Panasonic, with plans to amend it.
  • 6Panasonic is also a shareholder of Tesla, having invested $30.0 million in a private placement in November 2010.
  • 7A joint press release dated July 31, 2014, from both companies is filed as an exhibit.

Frequently Asked Questions

The primary purpose is to formalize the collaboration for the Gigafactory, with Panasonic committing to manufacture and supply lithium-ion battery cells and invest in the necessary equipment, while Tesla will provide the facility and handle battery pack assembly.

This agreement significantly strengthens Tesla's battery supply chain by ensuring a dedicated and large-scale production of battery cells at the Gigafactory, supporting Tesla's plans for increased vehicle production and potentially lowering costs through integrated manufacturing.

Panasonic's role is to manufacture and supply the battery cells and invest in their production equipment. Tesla's role is to provide the Gigafactory facilities and assemble the cells and other components into battery modules and packs.

This agreement deepens the existing relationship. It is intended to amend the prior Supply Agreement (from October 2011, amended in October 2013) to govern the ongoing purchases of cells from Panasonic, integrating it with the Gigafactory operations.