Panasonic (PCRFY  ) and Tesla (TSLA  ) are set to end a partnership to produce solar cells after Tesla entered the market in 2016 with the purchase of SolarCity.

Panasonic's partnership produced a solar cell production program at Tesla's Gigafactory in Buffalo, New York. Initially, the intent had been for Panasonic to produce solar cells for Tesla's solar products, such as its Solar Roof. Tesla, however, had been sourcing its solar cells from China, while Panasonic had been selling its U.S.-manufactured solar cells to customers in Asia.

The move is part of Panasonic's effort to divest in unprofitable ventures to cut spending and drive growth. The company is set to cease production in May and will be fully withdrawn from the factory by September. Currently, Panasonic employs 380 workers in Buffalo but is seeking to hold job fairs to help workers find new employment after production ceases, and will offer severance packages. Speaking of Tesla's post-pullout plans for the 380 workers, Panasonic said, "Panasonic is supporting Tesla in its efforts to identify and hire qualified applicants from Panasonic's impacted workforce. Tesla plans to hire qualified applicants to new positions needed to support its solar and energy manufacturing operations in Buffalo."

Tesla's solar ambitions have not been affected by Panasonic's decision, mainly because the company already sources many of its solar cells from other providers. As for the company's solar products, the production of its Solar Roof product appeared to be increasing. Tesla has also been forming partnerships with roofing companies to install its solar roofs. Tesla has also stated that it is seeking to hired additional employees at its Buffalo factory in anticipation of an increase in its solar-based production.

Despite Tesla and Panasonic ending their solar partnership, the companies still maintain their partnership to produce batteries in Nevada.