In a prelude to the proposed $2.6 billion merger of Tesla Motors and SolarCity, Tesla Motors revealed in a blog post that it has entered a non-binding letter of intent with Panasonic on the production of solar panels in SolarCity's Gigafactory in Buffalo, New York.

The partnership will see Tesla Motors integrate the solar cells and modules that Panasonic will begin manufacturing at the Buffalo facility next year into a solar energy system that will work with its energy storage products, the Powerwall and Powerpack.

Tesla Motors is planning to make a long-term purchasing commitment for the planned solar cells from Panasonic. However, the partnership is contingent on the shareholders of Tesla Motors and SolarCity approving the planned merger of the two Elon Musk-owned companies.

SolarCity's Buffalo facility was given the Gigafactory name for a similar reason behind the Gigafactory of Tesla Motors in Nevada, with the New York factory planned to produce more than 1 gigawatt of solar power capacity. The New York government has made an investment of $750 million in the facility, with the state actually owning the plant but renting it out to SolarCity at virtually no cost. The trade-off is that SolarCity is required to make heavy investments in filling up jobs at the site with workers coming from within New York.

"We are excited to expand our partnership with Panasonic as we move towards a combined Tesla and SolarCity," said Tesla CTO and co-founder with Musk, JB Straubel, who added that the partnership with Panasonic will allow for accelerated production of solar cells and modules at the best possible cost and at high efficiency and reliability.

It has been rumored that the first product that will be the result of the Tesla Motors and SolarCity merger could be unveiled as early as Oct. 28. The so-called solar roof will integrate with the version 2.0 of the Powerwall solar storage system of Tesla Motors to provide consumers with access to clean and renewable energy.

The Tesla Motors and SolarCity merger, which Musk said will create a company that will cater to all consumer needs for clean energy and green cars, is being touted as the biggest solar power deal to date. It is possible that the announcement of the partnership with Panasonic, along with the rumored unveiling of the solar roof on Oct. 28, will look to showcase what the merged company is capable of in advance of the upcoming shareholder vote to approve the proposed transaction.

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