Panasonic Rethinks its Battery Production Timelines in Kansas Amid Changing US Policies

Japanese electronics manufacturer Panasonic is rethinking production timelines for its battery plant in Kansas amidst shifting politics in the U.S. and a decline in battery electric vehicle (BEV) sales. First announced in 2022, the $4 billion De Soto battery production plant was billed as the biggest economic development project in Kansas history. After two years of construction, the 4.7 million-square-foot facility was launched with much aplomb on July 14 in a grand opening that featured a traditional Japanese ceremony for marking new beginnings. 

Unfortunately, the launch coincides with a period of great upheaval in the American electric vehicle sector. EV sales are on the decline, and the Trump administration’s Big Beautiful Bill has made it more expensive to buy an electric car in the U.S. by getting rid of federal tax incentives for new and used electric cars. Tesla, once the darling of America’s fledgling electric vehicle industry, is now suffering from major brand damage and diminishing sales. 

Furthermore, the GOP’s decision to suspended  the previous administration’s $5 billion EV charging network project will reduce public confidence in EV charging infrastructure and impact electric vehicle sales over the long term. As such, Panasonic will delay starting full EV battery production in its new Kansas facility. 

The Kadoma, Osaka-based company was set to achieve full production at the De Soto battery plant by March 2027 but has now pushed that milestone to a still-undisclosed date. With the Trump administration rapidly undoing most of the country’s climate action-related policies in favor of supporting fossil fuels, Panasonic may have a hard time selling EV batteries within the American market. 

The company received tax credits from the Kansas administration via the APEX program, an initiative created to attract massive economic development projects using rebates on staff training, capital investments, and payroll, among others. In addition to incentives of $829.2 million over a decade, Panasonic will also have its corporate income tax lowered by 0.5% for an entire fiscal year after it signs the megadeal. 

The EV battery production plant expects to employ 4,000 individuals by the end of next year, which will increase Kansas’ yearly labor income by more than half a billion dollars and bring about $2.5 billion worth of economic activity annually to Kansas, Governor Laura Kelly says. An extra 4,000 jobs would be created through deals with suppliers and community businesses, with an expected return of $26 for every $1 the state invested into Panasonic through tax incentives. 

Panasonic isn’t the only firm likely to be impacted by the change in federal policy in the U.S. EV makers like Mullen Automotive Inc. (NASDAQ: MULN) now have additional headwinds to navigate in their bid to make their mark upon the auto industry in America and around the world. 

NOTE TO INVESTORS: The latest news and updates relating to Mullen Automotive Inc. (NASDAQ: MULN) are available in the company’s newsroom at https://ibn.fm/MULN 

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