My understanding is that it's because Pano doesn't like Tesla's management style of the relationship (Pano prefers a loose feedback loop and team autonomy, Tesla wants it tight with rapid iteration and constant feedback up the chain), and that Tesla is about to scale up their own cell manufacturing. Feel free to throw citations in if you have solid evidence it's a demand issue, because Tesla sales figures and their last earnings call don't indicate that (their Model 3 backlog actually increased while deliveries also increased).