Abu Dhabi Drops Green Into Tesla
The Arabs, who sit on a pile of oil, must know something we do not. They suddenly show a surprising interest in electric cars. Daimler just sold part of its 10 percent stake in the alleged electric-car manufacturer Tesla to Abu Dhabi’s Aabar Investments, Bloomberg reports. What’s up with that?
Aabar will hold almost four percent of Tesla, Daimler will keep six percent. In March, Aabar, which is controlled by the emirate of Abu Dhabi, had bought 9.1 percent of Daimler for €1.95B ($2.72B), and overtook Kuwait as Daimler’s largest stockholder.
Keeping hydrocarbon-addicted luxobarges alive seems like a worthwhile cause if you sit on oil wells. But consorting with the electric enemy?
The purchase of the Tesla stock was prompted by “a desire to focus on the development of electric vehicles and projects aiming at the reduction of carbon dioxide emissions,” Aabar Chairman Khadem Al Qubaisi said in a statement.
Daimler had bought just under ten percent of Tesla for a “double-digit million-euro” sum in May. Daimler said again that it plans to install Tesla’s lithium-ion battery packs and charging equipment in 1,000 electric-powered versions of its Smart car. Or maybe they just need the green, as in cash?
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
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Arabs who have been sur-estimating their reserves for years are now looking at electric cars? Our grandchildren [or maybe just or children] will think we were crazy not to see that Peak Oil passed by in 1936.
Are they hedging their bets, hoping to make money no matter what the future holds? Also, the Arab and middle eastern guys I met in engineering school are all geeks, and a lot of them are car guys. (They're not representative of the country as a whole, but they are the kind of folks who are likely to have bright futures wherever they decide to settle.) Regardless of your home country's main business, an electric sports car is just pretty damn cool. I can think of at least 3 guys who would buy a Tesla in a heartbeat if they had the money -- and the dad of at least one of them probably does have the money... So, I bet the guy who made the decision to invest in Tesla is thinking about the potential sales that he sees in his neighborhood (backed up by some market research), and he's probably also thinking that it's a good way to hedge against the oil market. Plus, maybe he'll be able to ste forward a few places in line for a nice new Tesla Roadster. :-)
The Kuwaitis, at the very least, are well aware of Peak Oil, as their primary field (Bergen) peaked years ago and their exports are in decline. Iran peaked back in the 1980's. Meanwhile, at Saudi Aramco (the Saudi Arabian national oil company) there is a popular saying originally attributed to Sheik Rashid bin Saeed Al Maktoum, the former Vice-President and Prime Minister of the United Arab Emirates: "My father rode a camel, I drive a Mercedes, my son drives a Land Rover, his son will drive a Land Rover, but his son will ride a camel." Finite resources are just that, finite.
Aaber could have bought into Tesla any day of the week. It's not like Tesla were being shy about their need for VC. The question is why has Daimler sold 40% of THEIR stake in Tesla, less than 4 weeks after buying it themselves (rumoured price for 10% of Tesla was $50Mn). Are they so desperate that they want to raise $20M cash from the Arabs?!