By on August 8, 2014

Elon Musk + Akio Toyoda

Just four years ago, Tesla and Toyota entered into a relationship where the former would supply battery packs for the latter’s RAV4 EV. In turn, Toyota invested $50 million in Tesla, and sold the NUMMI facility — which Toyota once shared with General Motors — for $42 million. Things have changed, in the sage words of Bob Dylan.

Bloomberg reports the relationship — coming to a close with the end with the RAV4 EV program and Toyota’s new focus on hydrogen — was marred early on when engineers for both automakers fought over the EV crossover’s parking brake and an enclosure that would protect its battery from the road. Further, proprietary issues between Tesla and Toyota regarding energy-capture systems strained development of the crossover’s own system.

With most of the 2,600 RAV4 EVs delivered, Toyota changed its focus on hydrogen, a technology Tesla CEO Elon Musk mockingly refers to as “fool cells” due to their complexity and high costs hindering any success hydrogen may have. In response, Toyota Motor Sales senior vice president Bob Carter proclaimed “competitors who dismiss fuel cells out of hand do so at their own peril,” and personally doesn’t care what Musk or other detractors think about the parent company’s new path.

While the partnership may be “on hold” for the time being, both companies are working with other automakers in separate projects, such as Toyota and BMW co-developing a sports car, and Tesla providing batteries for Daimler’s Mercedes B-Class EV.

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28 Comments on “Tesla-Toyota Relationship On Hold After Rocky RAV4 EV Program...”


  • avatar
    Erikstrawn

    “Further, proprietary issues between Tesla and Toyota regarding energy-capture systems.”

    Not a complete sentence.
    [/grammar nerd]

  • avatar
    Pig_Iron

    Very interesting. It looks like Toyota is committed. It will be interesting to see how FC manufacturing would move from the lab to a manufacturing plant. Ballard failed at this, but Toyota traditionally doesn’t act without long careful thought and consideration of proof.

    • 0 avatar
      FormerFF

      I don’t doubt that Toyota can produce a fuel cell vehicle. What gives me pause is the production and delivery of gaseous hydrogen fuel.

    • 0 avatar
      Vulpine

      At least in Japan, Toyota is working with the strong support of the government up to and including the development of a hydrogen distribution infrastructure. So far, it appears that hydrogen infrastructure in the States is left to private backers. A recent report showed one company paying $140-something million to build TWO hydrogen fuel stations in northern California.

      • 0 avatar
        FormerFF

        It was 4.3 million. There’s a post here about it: https://www.thetruthaboutcars.com/2014/08/linde-north-america-receives-4-3m-build-two-nocal-hydrogen-stations

      • 0 avatar
        Stovebolt

        Actually the California Energy Commission is paying a gas supplier that to build the stations. Ethanol seemed like the dumbest thing ever in terms of actual cost to produce fuel, but hydrogen may have it beat. Note that no one is talking about how much hydrogen actually costs per mile driven. The only thing missing is little green badges like flexfuel, but that’s surely next.

        • 0 avatar
          Lorenzo

          An environmental quandary, hydrogen is. The quickest way to obtain hydrogen is dissociation from water, but that’s energy intensive. The lowest cost would have to involve nuclear power plants, but that’s an acute environmental concern. Somehow, I suspect the oil age will continue until somebody comes up with di-lithium crystals.

          • 0 avatar
            jdogma

            Nobody is talking about possible fuel cell use with petroleum. That’s where we get commercial hydrogen, and fuel cells could be made to directly use petroleum stock. Using oil in this way is more efficient than burning it in an IC engine.

  • avatar
    FormerFF

    Toyota’s looking at a lot of technologies. Here’s something on a free piston engine, which I would think would be going into a plug in hybrid, a type of powertrain that Toyota already has in production: http://www.roadandtrack.com/go/out-of-turn-toyota-engine

  • avatar
    FractureCritical

    fuel cells are a fool’s errand. They make all the engineering sense in the world for as long as you don’t look past the tank. After that, they become monumentally stupid.

  • avatar
    LALoser

    It will be interesting to see if this is the first of a few small dings against Elon Musk / Tesla. Once the media turns, things just build up.

  • avatar
    frozenman

    Toyota will get along fine without Mr. Slick, an automotive mega-store just cut ties with a buy here pay here dealer.

  • avatar
    SCE to AUX

    “fool cells” is a good one I hadn’t heard before; Mr Musk is right.

    Tesla won’t mind the breakup; those 2600 batteries & fixin’s probably only amounted to a week’s worth of Model S revenue at this point.

  • avatar
    APaGttH

    This was always a relationship of convenience.

    Toyota wanted to unload NUMMI and needed a way to put their toe in the EV waters without a massive investment.

    Tesla at the time needed to look like a legit car maker and needed a factory for the S.

    Toyota has always dismissed full electric vehicles, and has said for a decade hybrids and H2 is the answer.

  • avatar
    mike1dog

    You have to wonder why anyone would fight over a parking brake.

    • 0 avatar
      jdogma

      My thoughts too. lol

    • 0 avatar
      SCE to AUX

      There could be many reasons:

      -Cost targets
      -Packaging requirements
      -Safety issues
      -Battery compromises
      -Interior changes for different styles
      -Performance with added battery weight
      -Inventory burden of carrying two different designs
      -Customer perceptions between different styles (manual, electric, pedal)

      As a design engineer, I can tell you that such a fight could be epic, and could have a lasting impact on the product outcome.

    • 0 avatar
      WheelMcCoy

      @SCE to AUX nailed it. The link to the Bloomberg story goes into a little more detail. Tesla’s experience developing their Roadster indicated an electronic brake would be better than a parking pawl. Toyota would have none of it.

      But the fights weren’t just about the parking pawl. Not all technology between the two companies could be exposed, so they each had to work with the other’s “black boxes.” Also, Toyota knows their customers very well. And Tesla knows their customers very well. The customers are not the same, hence conflict with underlying design, technology, and philosophy.

      • 0 avatar
        Pch101

        I honestly have my doubts that these spats were a big deal in the scheme of things.

        TMC has never been excited about purely electric cars, yet needs to offer one in California due to state regulations. At the same time, selling the NUMMI plant to any company that wasn’t a manufacturer was going to be costly to TMC, while Tesla desperately needed a production plant in order to hit its DOE loan milestones.

        Hence, this deal. From here, it looks like a marriage of convenience from the start. Had it not been for the GM bankruptcy forcing the NUMMI issue, none of this may have happened.

        • 0 avatar
          WheelMcCoy

          I agree. A marriage of convenience from the start, a breakup was inevitable.

          But the spats reminds me of when Microsoft was a young upstart, teaming up with old stodgy IBM to work on OS/2. That didn’t end well either.

  • avatar
    blowfish

    Tesla’s experience developing their Roadster indicated an electronic brake would be better than a parking pawl. Toyota would have none of it.

    only way it works safely will be similar to air brakes, u need electricity to free it to move. Or else means juice to stop or lock, that doesn’t look good at all.

    • 0 avatar
      Vulpine

      That’s exactly the thing, BF; when Tesla’s cars run out of juice, the brakes lock to prevent it from moving. Naturally this makes them very difficult to tow unless you feed them enough juice to unlock the brakes. A lot of people complain about this, but it’s a very efficient means of ensuring the car won’t roll away if/when the battery dies.

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