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Toyota invests $50 million in Tesla Motors for electric car tie-up news
21 May 2010

Toyota, the world's largest car maker has acquired a $50-million stake in Silicon Valley-based electric car maker Tesla Motors and jointly co-operate in developing electric vehicles (EV).

Under the deal, Tesla will build its electric car, the Model S sedan, and future vehicles in a recently purchased plant in Fremont, California from New United Motor Manufacturing (NUMMI), a joint venture between General Motors and Toyota.

Till last month, the NUMMI factory was used by Toyota to produce the Corolla and Tacoma vehicles using the industry-leading Toyota production system. It is one of the largest, most advanced and cleanest automotive production plants in the world.

The Model S is expected to be the first pure electric premium sedan and is designed from the ground up to take full advantage of the electric vehicle architecture.

The sedan, which Tesla unveiled in March 2009, has an anticipated base price of $49,900, including a federal tax credit, and has an optional extended-range battery pack that runs over 300 miles per charge.

"I've felt an infinite possibility about Tesla's technology and 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," he added.

"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," he added.

The partnership will help Toyota, to compete with its rivals in the US, Nissan Motor and General Motors in the electric cars segment, where the US government is pushing carmakers to make more fuel efficient and green cars.

Toyota introduced the first-generation Prius hybrid vehicle in 1997, and produced approximately 2.5 million hybrids in the twelve years since. Late last year, Toyota 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.

Palo Alto, California-based Tesla designs and manufactures EVs and EV powertrain components. It is currently the only automaker in the US that builds and sells highway-capable EVs in serial production and has delivered more than 1000 Roadsters, the first production automobile to use lithium-ion battery cells, to customers in North America, Europe and Asia.

Many overseas carmakers have shown a keen interest in Tesla Motors for its powertrain technology although it had generated $126.8 million in revenue for 2009.

German car maker Daimler AG had acquired a 10-per cent stake in May 2009 and taken a board seat on the venture capital-backed Tesla Motors, (See: Daimler picks up stake in electric-vehicle manufacturer Tesla) but sold part of the stake in July 2009 to Aabar Investments PJSC, after the emirate of Abu Dhabi controlled investment fund acquired a 9.1 per cent stake in Daimler for €1.95 billion. (See: Abu Dhabi's Aabar takes a stake in electric car maker Tesla)





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Toyota invests $50 million in Tesla Motors for electric car tie-up