Tesla and Toyota Announce Joint Development Agreement - Toyota to Invest in Tesla - COMPLETE VIDEO
The big question as to how and where would Toyota enter the electric car fray may now be answered
By Marc J. Rauch
Exec. Vice President/Co-Publisher
THE AUTO CHANNEL
AUTO CENTRAL - May 20, 2010: Just two days ago, at the Western Automotive Journalists 3rd Annual Future Fuel Symposium, a big question on the minds of most of the panelists and attendees was, what will Toyota's role be in the future of electric automobiles?
For some time we've been hearing about General Motors' plans with the Chevy Volt, Nissan/Renault's Leaf, Ford's plug-in aspirations, Mitsubishi's i-Miev, and even the German carmakers - Mercedes-Benz, BMW and Audi - have been presenting full electric concepts at auto shows. Honda has made no secret of their ambitions with fuel-cells and electric to complement their hybrid efforts, but Toyota, the sort of newly anointed top carmaker has been quiet on the issue.
However, late this afternoon, news from Palo Alto, California (Tesla's home) is that Toyota and Tesla will cooperate on the development of electric vehicles, parts, and production system and engineering support. While a purchase of $50 million in stock is not really a big deal, the 'unspoken' endorsement of such a move will undoubtedly spark sales of Tesla's stock and push its value up. My guess is that this "small" investment could translate into a market cap of hundreds of millions, if not billions of dollars.
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Presuming that this relationship is not just a window decoration PR move, the association could be dynamite for both companies; thrusting Toyota into a leading electric car position, while giving Tesla the automotive credibility and distribution that it has sorely needed.
The two companies intend to form a team of specialists to further those efforts. Toyota Motors Corporation 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.
”I sensed the great potential of Tesla's technology and was impressed by its dedication to monozukuri (Toyota’s approach to manufacturing),” said TMC President Akio Toyoda. “Through this partnership, by working together with a venture business such as Tesla, Toyota would like to learn from the challenging spirit, quick decision-making, and flexibility that Tesla has. Decades ago, Toyota was also born as a venture business. By partnering with Tesla, my hope is that all Toyota employees will recall that ‘venture business spirit,’ and take on the challenges of the future."
"Toyota is a company founded on innovation, quality, and commitment to sustainable mobility. It is an honor and a powerful endorsement of our technology that Toyota would choose to invest in and partner with Tesla," said Tesla CEO and cofounder Elon Musk. "We look forward to learning and benefiting from Toyota's legendary engineering, manufacturing, and production expertise."
TMC has, since its foundation in 1937, operated under the philosophy of "contributing to the society through the manufacture of automobiles," and made cars that satisfy its many customers around the world. TMC introduced the first-generation Prius hybrid vehicle in 1997, and produced approximately 2.5 million hybrids in the twelve years since. Late last year, TMC started lease of Prius Plug-in Hybrids, which can be charged using an external power source such as a household electric outlet. The company also plans to introduce EVs into the market by 2012.
Tesla's goal is to produce increasingly affordable electric cars to mainstream buyers – relentlessly driving down the cost of EVs. Palo Alto, CA-based Tesla has delivered more than 1000 Roadsters to customers in North America, Europe and Asia. Tesla designs and manufactures EVs and EV powertrain components. It is currently the only automaker in the U.S. that builds and sells highway-capable EVs in serial production. The Tesla Roadster accelerates faster than most sports cars yet produces no emissions. Tesla service rangers make house calls to service Roadsters.