Daimler Buys 10% of Tesla

Robert Farago
by Robert Farago

According to Forbes, German automaker Daimler has purchased a 10 percent stake in Silicon Valley’s EV sweetheart, Tesla Motors. “The two companies are already working together on using Tesla’s lithium-ion battery packs and charging electronics in Daimler’s electric version of its two-seat Smart car. The stake’s value was not disclosed, but [Daimler’s R&D meister Thomas] Weber said it was in the double-digit millions.” Don’t you just love it when German managers go all coy about their American acquisitions, like, say, when Daimler bought Chrysler? Of course, we mustn’t forget Musk. Announcing the news, Elon did what he does best: pile on the hype. “Tesla Chief Executive Elon Musk said in a statement that the partnership would help it bring the Tesla Model S car to production faster and ‘ensure that it is a superlative vehicle on all levels.'” Excuse me? Other than providing cash for battery packs for the Smart, where’s the bit about Mercedes helping Tesla develop the Model S? Oh maybe it’s something to do with this . . .

As part of the deal, Daimler vice president Herbert Kohler will take a seat on Tesla’s board of directors.

See? Now that’s funny. Can you imagine?

Robert Farago
Robert Farago

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  • JEM JEM on May 19, 2009

    So Elon chased everyone away from Tesla who knew anything about production engineering a car, and now Daimler-Benz is going to save his butt? I'd be very surprised if DB went into this deal without some substantial protections in the agreement and more control over the operation than a 10% stake would indicate.

  • Carguy Carguy on May 19, 2009

    Tesla is run like a silicon valley startup software company: Load of hype, funded by VC cash and customer deposits but very little in the way of product, a product maintenance plan or profit. Maybe the Daimler deal is a good (or desperate?) move as they certainly do need all the engineering expertise they can get. The Lotus engine swap took them years while Fisker and RUF seem to have done similar projects in months. But who knows, maybe Daimler is just wanted to get in on the hype?

  • Samuel L. Bronkowitz Samuel L. Bronkowitz on May 19, 2009
    Tesla is run like a silicon valley startup software company: Load of hype, funded by VC cash and customer deposits but very little in the way of product, a product maintenance plan or profit. Well said. And, like most software start-ups that are absorbed by big companies, the resulting "synergies" never happen. The bureaucracy of the big company crushes whatever was good about the small company. The good people figure it out and leave early. Those that have a "stake" stay around until they satisfy their contract and then they leave. I've been through it twice and it was so easy to predict both times. I predict epic fail.
  • Guyincognito Guyincognito on May 19, 2009

    Ok, I'm a major critic of Tesla and Elon, but this is huge. With the backing, ie. cash, of Mercedes and a platform and engineering help, I believe they could produce the Model S. I still doubt it will be profitable at the price point Elon claims or that it will live up to his performance targets, but this news has me at least believing it may exist.

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