Daimler Buys 10% Stake in Tesla

On Tuesday, Daimler bought a nearly 10 percent stake in Tesla Motors for a "double-digit million sum." The two companies had already made a deal for Tesla to provide battery packs for Daimler's all-electric Smart EV, set for release in 2012, but this new partnership will expand that relationship, seeing both companies bringing expertise to the other.

Elon Musk, Tesla's CEO, said of the deal, "Tesla brings expertise in the battery electric front. Daimler brings expertise in everything else. This will be a very productive relationship where both Tesla and Daimler benefit."

Tesla will no doubt look to Daimler for help with the production and launch of the Model S. It's also possible that Tesla will begin using batteries from Li-Tek, a company that Daimler has a 49.1 percent share in, once they're available.

Daimler will be looking to Tesla for all things electric, including charging technology and how to quickly bring an electric car to market.

It seems to be a deal that will only be beneficial to both sides. Tesla needs the cash and Daimler needs a cutting edge start-up to help keep its line current.

The deal also includes a seat on Tesla's board for Daimler's VP of E-Drive and Future Mobility, Herbert Kohler.

via Wired's Autopia

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Very good news
written by Josh Abadie, May 21, 2009

This is probably a good move for both companies. I wonder though if this will be good in the long run for the economy. Big companies have a way of swallowing small ones.

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written by bill, May 22, 2009

This purchase is putting the value of Tesla at not much more than the $350 million in loans Tesla will receive from the US government. Daimler might be doing this deal just to get some of the government money.

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