That struck home on April 3 if the electric-car manufacturer missed hopes, delivering 31 percent fewer cars in the last quarter in comparison to the previous one. Tesla said problems transporting a”massive increase” of automobiles to Europe and China was one reason for it bringing only 63,000 cars–50,900 Model 3 and 12,100 Model X and S vehicles–compared to 76,000 expected by analysts. Because of this, Tesla lost money again, despite Musk’s guarantee last October which “we can be optimistic cash flow and profitable all quarters going forward. ”

It’s a significant turnaround. Late last year, Panasonic CEO Kazuhiro Tsuga reiterated his devotion to improve the $1.6 billion investment in the combined factory with Tesla from the Nevada desert, where his company builds battery cells because of its partner’s electric vehicles. Although Panasonic had been reporting that it was losing cash on the making of those cellsmore than $180 million (¥20 billion) by the end of its fiscal year–it appeared prepared to take the hit and adhere with Elon Musk, Tesla’s erratic CEO. “Though Elon’s comments are unpredictable, we will continue to track Tesla’s operations to ensure no chaos there and also will operate in step with the company,” Tsuga informed Reuters.

Build it and they’ll come. The prophecy has held true for Tesla, which has become the world’s manufacturer, rolling a wildly popular series of sedans and SUVs.
But a Tesla spokesperson said Panasonic and Tesla would invest ” to Gigafactory 1 to “ substantial funds. The business stated it could improve present production equipment. “we’re currently seeing substantial gains from upgrading existing lines to improve output, allowing Panasonic and Tesla to achieve the identical output with less composed by email. It remains the fundamental constraint on Tesla vehicle and Powerwall/Powerpack production.”
But that approach is faltering. Japan’s Nikkei Asian Review reports this week (paywall) that Panasonic won’t be investing at an expected expansion that would have boosted the battery manufacturing ability of Tesla’s Gigafactory 1 by 50%. As harsh fiscal realities place in for Tesla, its stated goal of generating 1 million cars per year will likely be deferred.

Tesla was hit by a downturn in sales, logistics bottlenecks, and thinner margins as the cheaper Model 3 appears to siphon off some earnings from the premium Model S and X offerings. Nationwide, US auto sales have shrunk to the lowest point in over four years, reports industry research company J.D. Power.
No more. Panasonic is suspending its planned investments in Nevada, in addition to in Tesla.