At Panasonic’s massive battery plant in De Soto on Monday, Kansas political leaders stood beside Japanese dignitaries on stage with wooden mallets in their hands.
They huddled together to perform “kagami wari,” a Japanese ceremony marking new beginnings. On the count of three, they plunged their mallets into white wooden sake casks, “Panasonic Energy” labels facing out.
The event drew lawmakers at every level, foreign media and major business leaders to celebrate the start of production. Officials said batteries started rolling down the line a week ago with 1,100 workers hired so far.
The company aims to employ 4,000 people by the end of 2026. And Democratic Gov. Laura Kelly said the plant is expected to bring $2.5 billion of economic activity to the state each year.
Republican U.S. Senator Jerry Moran said the development represented the largest private investment in state history.
“This is a day of joy,” he said. “This is a major accomplishment for Panasonic and for the state of Kansas.”
That cheerful mood prevailed despite serious headwinds in the electric vehicle industry, which some fear could keep the 4.7 million-square-foot battery factory from reaching its full potential — and its hiring goals.
Tesla, tariffs and taxes
Republican President Donald Trump has threatened tariffs that would make it more expensive to manufacture EVs. Tesla, the nation’s largest EV maker, recently saw its profits dip amid CEO Elon Musk’s involvement with the Trump administration’s sweeping funding cuts and federal employee layoffs.
And as part of Trump’s seismic tax and spending bill that recently passed, a $7,500 tax credit for EV purchasers will end in September. Those tax credits were created during Democratic President Joe Biden’s term.
Allan Swan, President of Panasonic Energy North America, told reporters that turbulence in the EV market is to be expected.
“We’re in a brand new industry,” he said. “So that industry’s going to ebb and flow a little bit as she grows — and she will grow.”
At full capacity, Swan said the facility will produce 70 batteries per second for Tesla, Toyota, Lucid, Hexagon Purus and Harbinger Motors.
As for concerns about tariffs on products used to manufacture batteries, especially from China, Swan said Panasonic is working on finding more options to create “a stronger supply chain.”
De Soto Mayor Rick Walker shared Swan’s optimism for the long-term health of the EV industry. To take advantage of the tax credit before it expires, Walker recently bought an EV of his own — though he went for a cheaper option than a Tesla.
“I really like the car, even if I don’t like the guy that is the front for it,” he said, referring to Musk.
A good deal?
Lt. Gov. David Toland, a Democrat who doubles as the Kansas commerce secretary, said he’s not concerned about current economic conditions because the EV industry has grown overall.
