Kansas lands $4B Panasonic EV battery plant project

Published: Jul. 13, 2022 at 1:06 PM CDT
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TOPEKA, Kan. (WIBW) - State officials are celebrating what they’re calling the largest economic development project in Kansas history.

Gov. Laura Kelly, Lt. Gov. and Commerce Sec. David Toland, and other leaders gathered Wednesday evening in downtown Topeka to confirm Panasonic chose a site in Kansas for its new electric vehicle (EV) battery manufacturing facility. The $4 billion investment will come at the former Sunflower Ammunition Plant in DeSoto, and be the third factory of its kind in the U.S.

The news was first reported by Japanese-based Asian news source Nikkei Asia.

“Winning this project shows that Kansas has what it takes to compete on a global scale -- and that our pro-business climate is driving the technological innovation needed to achieve a more prosperous and sustainable future,” Kelly said.

State officials did not publicly identify the company until Wednesday’s announcement, even though efforts to land the deal started several years ago, and led to lawmakers approving a bill during the 2022 session designed to attract the company - the Attracting Powerful Economic Expansion Act, or APEX.

The State Finance Council met in executive session Wednesday afternoon to officially improve the incentive package. In a news release Wednesday evening, the Governor’s office revealed the APEX investment totals $829.2 million, to be paid after certain investment and employment benchmarks are met. The package includes a $500 million investment tax credit (12.5% over 5 years); a $234 million payroll rebate paid over 10 years; $5 million for education and training per year over five years; a relocation investment of $1 million per year over 10 years; and a $60.2 million sales tax exemption over 5 years.

Kelly called it an investment that will benefit the entire state. It’s expected to create 4,000 new jobs, plus , support an estimated 4,000 additional jobs created by suppliers and community businesses and 16,500 construction jobs.

The facility will create and supply lithium-ion batteries. The move follows the opening of Tesla’s other American EV factory in Texas to meet the rising demand for electric vehicles. Panasonic hopes to triple or even quadruple EV battery production capacity by the 2028 Fiscal year from the current level of about 50 gigawatt-hours per year.

“With the increased electrification of the automotive market, expanding battery production in the U.S. is critical to help meet demand,” Kazuo Tadanobu, President, CEO of Panasonic Energy, said. “Given our leading technology and depth of experience, we aim to continue driving growth of the lithium-ion battery industry and accelerating towards a net-zero emissions future.”

Tesla’s sales have steadily spiked with annual vehicle deliveries reaching nearly 936,000 in 2021.

In February, Gov. Kelly noted that the state was a finalist for the site which remained unnamed until now.

“As the largest private investment in Kansas history and one of the largest EV battery manufacturing plants of its kind in the country, this project will be transformative for our state’s economy, providing in total 8,000 high-quality jobs that will help more Kansans create better lives for themselves and their children,” Kelly said.

Sen. Jerry Moran, R-Kansas, was in Topeka for Wednesday’s evening’s announcement. He said he sees the economic development as a great opportunity to improve the state of Kansas.

“With this major development, Kansas is being recognized around the world for our talented workforce, innovative environment, and quality of life,” Moran said. “Panasonic will bring thousands of good-paying, high-quality jobs to our state which will be a massive economic benefit for local businesses and our communities for decades to come. With the goal of making Kansas a destination for industry, defense, education, science, technology, engineering, and innovation, we will keep our students, their knowledge and intellect in Kansas.”

Sen. Roger Marshall, R-Kansas, says the great news means thousands of jobs are on the way to the Sunflower State.

While some lawmakers expressed reservations about the size of the incentive and the secrecy surrounding it during legislative debate, Republican leadership issued statements supporting the announcement.

“Kansas is proving itself to be an attractive place where entrepreneurs can unleash innovation and create jobs,” said Sen. Ty Masterson, Senate President. “The Panasonic announcement shows that attraction is global.”

“When the Kansas Legislature passed the APEX legislation, this was the kind of megaproject we had in mind,” House Speaker Ron Ryckman said.

The White House also weighed in on the news, issuing a statement from National Economic Council Director Brian Deese.

“The announcement is also another proof point of the success of the Administration’s efforts to create more resilient and secure supply chains and outcompete the rest of the world in the technologies of the future,” Deese said.

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