By: Morgan Chilson
Kansas Reflector
TOPEKA — Panasonic is delaying full production in its De Soto battery plant because of dropping electric car sales and U.S. policies that do not support electric cars, international media reports.
The $4 billion economic development project, billed as the largest in Kansas history, is threatened because of decreased electric car sales at Tesla and skepticism from President Donald Trump about encouraging electric vehicle adoption, according to the Nikkei Asia news outlet.
The plant was expected to reach full production by March 2027, and a new target date has not been set, Nikkei reported.
The president’s “big, beautiful bill” eliminates tax credits for the purchase of electric vehicles as of Sept. 30, along with eliminating or decreasing multiple green energy tax credits.
The De Soto plant, which was projected to create 4,000 jobs, has a grand opening scheduled Monday.
The Panasonic plant began construction in 2023 after receiving Kansas tax credits, through a program known as APEX that the state created to draw in large economic development projects. Incentives include rebates on capital investments, payroll and staff training.
The APEX program also lowers the corporate income tax rate by 0.5% for Kansas businesses for the fiscal year after a megadeal is signed. Under the APEX deal, Panasonic was expected to receive $829.2 million over 10 years.
The company had plans to provide at least 4,000 jobs, increasing the state’s annual labor income by more than $505 million. The state anticipated the project will create an additional 4,000 jobs through suppliers and community businesses. The state expected to see a $26 return for every $1 invested in tax incentives.
The De Soto community also offered incentives that were based on the company agreeing to employ 2,500 employees, well below the estimated full employment of 4,000.
The city offered to complete $229 million of public infrastructure projects, such as road improvements, and water and sewer projects, using Tax Increment Financing funds, a common economic development tool that uses increased property taxes received from developments to fund projects.