* Battery 'giga factory' for electric cars would be a first for U.S.
* Plant due on-stream in 2017, key for next-generation Tesla car
* Panasonic looking for other supplier partners for plant -Nikkei
* Tesla has said it would announce details on plant this week
Feb 26 (Reuters) - Panasonic Corp is considering investing in a U.S. car battery plant planned by Tesla Motors Inc, sources familiar with the plan said on Wednesday, with total investment estimated by one source around 100 billion yen ($979 million).
The facility, expected to go on-stream in 2017, is part of Tesla's blueprint for a more affordable electric vehicle and would be the first major, integrated U.S. facility producing battery cells for electric cars.
Tesla shares hit an all-time high on Tuesday, after a brokerage set a new target price suggesting a rise of almost 50 percent from Monday's close, while Panasonic's shares jumped 7 percent on Wednesday to a three-week high.
Last week, Tesla gave some initial hints about plans for a lithium-ion battery plant, or "giga factory", that would likely include Panasonic and other suppliers as partners. It said that further details would be announced this week.
Tesla declined to comment on Tuesday. Panasonic, the car maker's primary supplier of lithium-ion batteries, said it wanted to expand its cooperation with Tesla but declined to comment further.
"We have a cooperative relationship with Tesla and are looking at various ways of strengthening that relationship in the future," the company said.
Sources close to the situation said Panasonic was considering investing in the giga factory project with an eye to expanding battery supplies to Tesla when its current supply contract ends in 2017. One of the sources added that the project would likely require a total of about 100 billion yen.
"Panasonic is looking at various types of cooperation, including taking on some of the investment," the source said. "But Tesla is a venture business, so there's a need to be cautious in looking at the risks involved."
The 100 billion yen figure was first reported in the Nikkei business daily, which also said Panasonic was inviting several Japanese materials makers to join the project.
The Nikkei said the plant would produce small, lightweight batteries for Tesla and may also supply Toyota Motor Corp and other automakers.
LOWER COSTS
Battery costs have been a major stumbling block to widespread electric car adoption in the United States, according to analysts. Tesla's giga factory will lower costs by shifting material, cell, module and pack production to one spot.