Insiders describe a world of chaos and waste at Panasonic's massive battery-making operation for Tesla

Linette Lopez 19h

• Current and former employees at Panasonic's battery-making operation inside Tesla's Gigafactory said it's a chaotic environment where standard operating procedures often go ignored and there are half a million pieces of scrap generated daily.
• "Why do we throw away half a million batteries a day? Because people are slobs and the stuff's not clean," a former employee said. Panasonic sends about 3 million battery cells to Tesla every day.
• Business Insider also reviewed internal documents, including some related to an oil spill that sent workers hunting for weeks through millions of battery cells to find potentially contaminated product.

Insiders have described a chaotic environment in Panasonic's battery-making operation in the Nevada desert, one where standard operating procedures go ignored, expensive mistakes are born from carelessness, and half a million pieces of scrap are generated daily.

"I do not think that Tesla knows everything (that goes on on Panasonic's side)," one former employee who left the company last year said. "It's impossible to know everything. If Elon Musk was to know what was truly going on, he would flip his lid."

Tesla and Panasonic share the Gigafactory, the massive manufacturing plant outside Reno, Nevada, built in 2016. At the Gigafactory, under the same roof, Panasonic makes cells for Tesla's cars, and then Tesla turns the cells into batteries for its new Model 3 sedan. Tesla also makes the drive units for the Model 3 there.

Last week, Nikkei reported that Tesla and Panasonic would freeze plans to expand the Gigafactory. Tesla's stock fell, while Panasonic's rose after the news. Tesla responded by saying that both companies were still putting "substantial funds" into the Gigafactory, but that there's more "output to be gained from improving existing production equipment."

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