Electric carmaker Tesla is to team up with Japanese electronics firm Panasonic to build a "gigafactory" battery manufacturing plant in the US.

Tesla said the plant would be built in Nevada, Arizona, Texas, New Mexico or California and create 6,500 jobs.

The factory will produce cells, modules and packs for Tesla's electric cars.

California-based Tesla will prepare, provide and manage the land and buildings, and Panasonic will make and supply the lithium-ion battery cells.

Tesla said the move would reduce its battery costs by 30%

"The 'gigafactory' represents a fundamental change in the way large-scale battery production can be realized," said Tesla chief technical Officer and co-founder J B Straubel, referring to the cost reductions.

Yoshihiko Yamada of Panasonic said the planned factory will help the electric vehicle market grow.

Sales of zero-emission electric vehicles currently make up less than 1% of the world's car market.

(BBC)