News & Analysis
Toyota invests in Tesla in electric car deal
Mark Lapedus
5/21/2010 1:04 AM EDT
Toyota has agreed to purchase $50 million of Tesla’s common stock issued in a private placement to close immediately subsequent to the closing of Tesla’s currently planned initial public offering (IPO). In January, Tesla announced the IPO. Goldman, Sachs & Co., Morgan Stanley, J.P. Morgan and Deutsche Bank Securities are acting as the joint book-running managers for the offering.
Last year, Daimler AG acquired an equity stake of nearly 10 percent of Tesla.
Tesla's goal is to produce affordable electric cars to mainstream buyers. Palo Alto, Calif.-based Tesla has delivered more than 1,000 Roadsters to customers in North America, Europe and Asia.
Separately, Tesla has purchased the former NUMMI factory in Fremont, Calif., where it will build the Model S sedan and future Tesla vehicles. As recently as April of 2010, the NUMMI factory was used by Toyota and GM to produce various vehicles. That venture recently ended, when GM and Toyota pulled the plug.
The Model S is an electric premium sedan. The sedan, which Tesla unveiled in 2009, has an anticipated base price of $49,900, including a federal tax credit. With an optional extended-range battery pack, the Model S will travel over 300 miles per charge.
In Janurary, Tesla Motors and Panasonic announced that they will collaborate to develop next-generation battery cells for electric vehicles.
Tesla will use Panasonic’s battery cells in their newest battery packs. The cells are comprised of nickel-based lithium ion chemistry.
Panasonic is midway through a three-year $1 billion investment in lithium-ion battery cell R&D and production facilities. The first of the new facilities in Suminoe, Japan will begin production in April 2010.
Tesla’s current battery strategy incorporates proprietary packaging using cells from multiple battery suppliers. This new cell will also be compatible with other cell form factors to enable the continuation of Tesla’s strategy of using cells from multiple suppliers.
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mark.lapedus
5/21/2010 1:02 PM EDT
Will Tesla fly or crash and burn? Does the e-car have a future? Thoughts?
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Lloyd P
5/21/2010 8:23 PM EDT
There have always been limited volume niche automakers who were able to survive for a while. But unless they are able to reach a sustainable sales volume, most wither and die (DeLorean), are absorbed into another automaker (Rolls Royce), or sell their engineering talents to the big guys (Lotus). The Tesla Roadster is based on a Lotus chassis, for example.
Lack of charging infrastructure, limited range, long recharging times, and higher cost than a comparable Internal Combustion powered vehicle will prevent E-Cars from becoming mainstream, without help. Tax incentives, as social policy, including government funding for purchase incentives and infrastructure improvements will help. Stable fuel prices > $5.00 a gallon will also bend the equation to help the economic viability of E-Vehicles.
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SallyF
5/24/2010 11:21 AM EDT
Battery chemistry and engineering are not yet adequate or suitable for automobile use. Note the recall of millions of laptop computer batteries the last few days. Imagine if those batteries cost $4000.00 each.
Batteries currently available are not safe enough for mass use. The media hyped a few accelerator problems, but imagine what they will do with battery fires and explosions when the energy released approaches that of gallons of gasoline.
Batteries currently available do not have the necessary capacity. Also, the charging infrastructure is not available.
Mark my words, unless the Osama Obama gang criminalizes gasoline or related ICE auto infrastructure, it will be at LEAST 30 years before battery powered cars become commonplace.
This minisucle investment by Toyota is probably only what the Democrats have extorted from them to continue doing business in the U.S.
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mickrussom
5/24/2010 2:18 PM EDT
I will never buy a Tesla. The "powers that be" in that company chased of the technologists and founders of Tesla with very dirty disgusting tactics. Then they use massive influxes of state and federal money to build impractically expensive and short range full electric cars.
For the money these fools wasted in public money at Tesla we could have built several nuclear power plants.
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Abrahim
5/26/2010 5:47 AM EDT
tesla is still not viable financial deal as compared to other conventional cars. $50k for a car is not evrybdy's idea of a clean transport.
and i seriously hope they will focus on the low cost version rather than wasting time on a 'sedan/saloon' version. the profits will not come from the niche sector but frm the broad consumer base of daily use cars.
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