Recent reports claim that Panasonic is reviewing further investment into electric car manufacturer Tesla’s Gigafactory in Nevada, as well as halting investment in a future Tesla factory in China.

Bloomberg reports that Panasonic is suspending further expansion and investment in Tesla’s $4.5 billion Nevada Gigafactory as the company questions the demand for Elon Musk’s electic vehicles. Panasonic and Tesla planned to raise the capacity of the plant by 50 percent by the year 2020, but financial problems have reportedly halted these plans. Panasonic also plans to halt investment in Tesla’s battery and EV plant in Shanghai, China. The company will, however, provide technical support and a small number of batteries from the currently operating Gigafactory.

Panasonic has invested heavily in production facilities alongside Tesla, and as its battery partner, is considered the company’s most important vendor.

Tesla shares have dropped in recent weeks, falling by nearly five percent to $263.20 per share in pre-market trading in the United States. Tesla shares have declined by 17 percent year to date. Tesla has seen a record decline in deliveries during the quarter ending in March, which has led to fears about lack of demand for the company’s Model 3 sedan.

Panasonic commented on the decision stating: “Panasonic will study additional investments over 35 GWh in collaboration with Tesla.” Tesla is expected to report first-quarter earnings on April 24, this is expected to be a key report for the company.

Tesla has recently defended poor vehicle delivery figures stating in a press release: “We had only delivered half of the entire quarter’s numbers by March 21, ten days before end of quarter. This caused a large number of vehicle deliveries to shift to the second quarter.”

Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship. Follow him on Twitter @LucasNolan or email him at lnolan@breitbart.com