Panasonic Corp is shoveling more than $256 million into a New York-based Tesla Motors facility facing federal corruption charges.
Panasonic, which is gradually moving closer to electric vehicles, will make the investment despite corruption charges leveled against the contractor building the so-called “Buffalo Billion” project.
The two companies said they plan to begin producing of solar panel modules at the facility in the summer of 2017. Panasonic’s investment is part of the solar partnership that the two companies first announced in October.
Tesla is also working with Panasonic to produce lithium-ion batteries for the upcoming Model 3, as well as every other electric vehicle in Tesla’s fleet.
Investigators believe the Buffalo Billion disproportionately benefits wealthy developers who frequently donate to New York Democratic Gov. Andrew Cuomo, as well as companies known for spending Buffalo tax dollars lavishly in the past. SolarCity hasn’t been named in the probe.
The investment comes after SolarCity and Tesla merged forces in November, helping the former deal with a failing financial situation.
The Panasonic-Tesla deal could very well be a means of propping up SolarCity, which is more than $3 billion in debt and hasn’t turned a profit since 2012. It spent $438 million this year, nearly 50 percent more than its revenue of $308 million.
Panasonic’s move may show the electronic appliance company snuggling closer and closer to Tesla’s business model. The company is forking over $1.6 billion to the cost of the electric vehicle maker’s gigafactory in Nevada.
The project faces innumerable delays and hiccups due to the investigations.
Contractors working on the $900 million Buffalo Billion project, for example, haven’t been paid for work started in July, when the lack of cash forced the state to lay off workers.
Most of the payments are being held up because of a cascade of corruption charges leveled against LPCiminelli, one of the contractors pegged to manage construction at the Tesla facility.
State officials maintain the payments will be made once the review process is completed.
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