Panasonic Holdings plans to begin mass production of battery cells for data centre applications in the United States by fiscal 2028, positioning itself to benefit from rapidly rising demand driven by artificial intelligence infrastructure expansion.

The company said production will be centred at its facility in Kansas, marking a strategic extension beyond its core electric vehicle battery business into energy storage systems designed for data centres.

The initiative reflects a broader industry shift as AI-driven computing growth accelerates global demand for reliable backup power.

Data centres require increasingly advanced battery systems to maintain uninterrupted operations during outages and to stabilize fluctuating electricity supply, creating a fast-growing market for energy storage providers.

Kazuo Tadanobu, chief executive of Panasonic Energy, said the company is targeting ¥950 billion (about $5.93 billion) in sales from data centre-related energy storage systems in fiscal 2028, calling it a minimum target while indicating potential to exceed ¥1 trillion ($6.24 billion) annually.

The move is part of Panasonic’s broader strategy to diversify revenue beyond the cyclical electric vehicle market, where it has faced softer demand growth, tariff pressures, and heavy investment costs tied to expanding US manufacturing capacity.

The company supplies EV batteries to customers including Tesla.

Panasonic has already begun supplying battery products for data centre use in Japan and is preparing to localize production in the US, aligning with efforts by governments and corporations to strengthen domestic supply chains for critical technologies. -OGN/TradeArabia News Service