• May 19, 2009

Mercedes-Benz/Tesla press conference – Click above for ABG's liveblog coverage

During a press conference held at the Mercedes-Benz Museum in Stuttgart this morning, Dr. Thomas Weber, the head of research and development for Mercedes-Benz, announced that Daimler is buying a 10% stake in Tesla Motors. Tesla CEO Elon Musk was also on hand for the announcement. The companies did not specify the amount paid by Daimler, other than it was in the double digit millions. Daimler will be providing Tesla with engineering support and possibly parts that may go into the Model S. Tesla, meanwhile, will continue providing battery packs for the second-generation Smart ED starting later this year. Tesla will also focus on battery pack integration and battery management systems for Daimler going forward.

The deal will also give Tesla access to the automotive lithium ion cells being produced by Daimler's investment in Li-Tec, a joint venture between Evonik and Daimler. Weber announced that Daimler would commence series production of electric Smarts in 2012, with volume projections in the five digits.

Daimler's Prof. Herbert Kohler (who is in charge of e-drive systems at the German automaker) will take up a board seat at Tesla and oversee development at the California company. We live blogged the conference at AutoblogGreen this morning and the official press release is after the jump.

[Source: Daimler]


PRESS RELEASE:

Strategic partnership: Daimler acquires stake in Tesla

• German automaker acquires nearly 10 percent of one of the leading
electric vehicle companies
• Automakers agreed to cooperate in battery systems, electric drive
systems and vehicle projects

May 19, 2009

STUTTGART, Germany, and SAN CARLOS, Calif. – Daimler AG has
acquired an equity stake of nearly 10 percent of Tesla Motors Inc. This
investment deepens the relationship between the inventor of the
automobile and the newest member of the global auto industry. Tesla is
the only production automaker selling a highway capable electric vehicle in
North America and Europe.

The two companies have already been working closely to integrate Tesla's
lithium-ion battery packs and charging electronics into the first 1,000 units
of Daimler's electric smart car. In order to benefit from each other's know-
how, the investment enables the partners to collaborate even more closely
on the development of battery systems, electric drive systems and in
individual vehicle projects.

"Our strategic partnership is an important step to accelerate the
commercialization of electric drives globally," said Dr. Thomas Weber,
Member of the Board of Daimler AG, responsible for Group Research and
Mercedes-Benz Cars Development. "As a young and dynamic company,


Tesla stands for visionary power and pioneering spirit. Together with
Daimler's 120 years of experience in the automotive sector this
collaboration is a unique combination of two companies' strengths. This
marks another important milestone in Daimler's strategy for sustainable
mobility."

"Daimler has set the benchmark for engineering excellence and vehicle
quality for more than a century. It is an honor and a powerful endorsement
of our technology that Daimler would choose to invest in and partner with
Tesla," said Tesla Chairman, CEO and Product Architect Elon Musk.
"Daimler is also on the leading edge in the field of sustainable mobility.
Among others the lithium-ion pouch-cell battery developed by Daimler and
especially designed for automotive applications is of interest to us. We are
looking forward to a strategic cooperation in a number of areas including
leveraging Daimler's engineering, production and supply chain expertise.
This will accelerate bringing our Tesla Model S to production and ensure
that it is a superlative vehicle on all levels."

Together on the road to electro-mobility

As part of the collaboration, Prof. Herbert Kohler, Vice President E-Drive
and Future Mobility at Daimler AG, will take a seat on Tesla's board of
directors.

This long-term partnership with Tesla complements Daimler's multi-
facetted strategy to advance the electrification of the automobile.

Daimler is also moving forward the industrialization of lithium-ion
technology. In March, the company founded the Deutsche Accumotive
GmbH, a joint venture with Evonik Industries AG. As a result, Daimler is
the first vehicle manufacturer worldwide that develops, produces and
markets batteries for automotive applications. This is based on a Daimler
stockholding in Li-Tec, the German specialist for lithium-ion battery cells.

100 smart electric cars have already been undergoing large-scale trials in
London since 2007. These electric vehicles are being tested in day-to-day

assignments by fleet operators and private customers.

Later this year the smart assembly plant in Hambach, France, will start
production of up to 1,000 units of the second-generation smart fortwo with
electric drive, which will initially be used for mobility projects such as e-
mobility Berlin or e-mobility Italy. This year Daimler is also starting small-
series production of the Mercedes-Benz B-Class with a fuel cell drive
system. In 2010 the company will introduce its first battery-powered
Mercedes-Benz. As of 2012, Daimler plans to equip all smart and
Mercedes-Benz electric vehicles with own produced lithium-ion batteries.

In 2004, Tesla began development of its first electric vehicle, the Roadster,
which remains the only highway capable EV for sale in North America or
Europe. The Tesla Roadster is the first production battery electric vehicle
to travel more than 200 miles per charge and the first US- and EU-certified
lithium-ion battery electric vehicle. This green supercar accelerates from 0
to 60 mph in 3.9 seconds yet gets the equivalent of 256 miles per gallon.
The Roadster, which travels an estimated 244 miles per charge with zero
tailpipe emissions, is the first production vehicle to break the historical
compromise between automobile performance and efficiency.

The Tesla Model S builds upon the success of the Tesla Roadster by
leveraging its technology into the world's first fully electric sedan. Based in
Silicon Valley, Tesla unveiled the Model S in March and plans to produce it
in California starting in late 2011.

About Daimler

Stuttgart, Germany-based Daimler AG, with its businesses Mercedes-Benz Cars, Daimler Trucks,
Daimler Financial Services, Mercedes-Benz Vans and Daimler Buses, is a globally leading
producer of premium passenger cars and is the global market leader for heavy- and medium-duty
trucks and buses. The Daimler Financial Services division has a broad offering of financial
services, including vehicle financing, leasing, insurance and fleet management. Daimler sells its
products in nearly every country and has production facilities on five continents. Founders,
Gottlieb Daimler and Carl Benz, continued to make automotive history following their invention of
the automobile in 1886. As an automotive pioneer, Daimler and its employees willingly accept an
obligation to act responsibly towards society and the environment and to shape the future of safe
and sustainable mobility with groundbreaking technologies and high-quality products. The current
brand portfolio includes the world's most valuable automobile brand, Mercedes-Benz, as well as
smart, AMG, Maybach, Freightliner, Western Star, Mitsubishi Fuso, Setra, Orion and Thomas
Built Buses. The company is listed on the stock exchanges in Frankfurt, New York and Stuttgart

(stock exchange abbreviation DAI). In 2008, the Group sold 2.1 million vehicles and employed a
workforce of over 270,000 people; revenue totaled €95.9 billion and EBIT amounted to €2.7
billion. Daimler is an automotive Group with a commitment to excellence, and aims to achieve
sustainable growth and industry-leading profitability.

About Tesla Motors

San Carlos, Calif.-based Tesla Motors Inc. makes electric vehicles with exceptional design,
performance and efficiency, while conforming to all North American and European safety,
environmental and durability standards. The Roadster has a 0 to 60 mph acceleration of 3.9
seconds yet is more energy efficient than a Toyota Prius. Tesla expects to begin producing the
all-electric, zero-emission Model S sedan in late 2011.




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    • 1 Second Ago
  • 40 Comments
      • 5 Years Ago
      A nice shot in the arm from Tesla.
      • 5 Years Ago
      I find it hilarious how the Tesla/Musk bashers are finding ways to turn even the most positive pieces of news into "that's it, goodbye Tesla" material. Priceless !
      • 5 Years Ago
      Given Fisker's history at BMW, I'm guessing they already have a some coin on the table. It's just a matter of raising the stake to a serious level. When you think about it, Fisker would be a perfect fit for BMW and allow them to finish the Mini EV sooner.

      BTW, when will we see the press release from Elon announcing HIS aquisition of Daimler?
      • 5 Years Ago
      I wonder how long it is until they have a "merger of equals" and Daimler takes their technology and cash and limits them to producing cheap plastic cars on outdated platforms?
        • 5 Years Ago
        I'm happy for Tesla getting Daimler onboard because the obvious benefit is they can finish the Model S a lot quicker using the old E-class chassis.

        Of course I'm sure Tesla is wary of what Daimler did to Chrysler, which is probably why it's only 10% stake. But for a 10% stake, the benefits clearly outweigh the risks for Tesla. As long as it's not majority stake I don't think it's bad for the company.
      • 5 Years Ago
      Since Daimler sucks I'll write Tesla off the list of possibilities
        • 5 Years Ago
        I haven't heard many complaints about AMG since they brought them in house. Tesla should be more manageable for Daimler size-wise than Chrysler.
      • 5 Years Ago
      I would think that Daimler would have more of an interest in Fisker, since they seem to target similar markets. Still, I agree with DJ, look to see BMW buying a stake in Fisker.

      Perhaps Fisker was approached, but turned down the offer. I once saw the backers of Fisker, and Fisker is supported by some pretty deep pockets.
      • 5 Years Ago
      Did they buy 10% of Elon Musk's ego as well?
        • 5 Years Ago
        Priceless. Careful, however--you don't want Musk calling you a d*****bag.
      • 5 Years Ago
      YES! now it would totally make my day if Tesla is unionized. After all, according to Obama, a company performs so much better when it is operated by union members, it's been proven time after time.
        • 5 Years Ago
        Agreed. Anything that wipes the smug and naive grin off of Elon Musk's face.
      • 5 Years Ago
      This will be the kiss of death to Telsa.

      Mercedes ownership of Chrysler destroyed the company, effectively stopped all development of products that were not deemed to be germain to Mercedes existing product focus. The result was a company that has a terrible product line up, horrible product quality, and producing cars that are more state of the art 1980 technology than 2009... Oh and all of this lead to Chrysler filling for bankruptcy.
        • 5 Years Ago
        Not all them. Not even most of them. If you look at the offerings of Chrysler in the 80's vis a vie it competitors in North America (foreign and domestic) you will find plenty of competitive vehicles. If you do the same in the 90's you find vehicles that were well recieved by the auto press AND increased market share as well as profits. I know it's popular right now to diss Chrysler, and they certainly have brought much of it on themselvs but you can't win awards, get rave reviews, increase market share, and make huge profits on smoke and mirrors. And that's exactly what they did in the 90's. Daimler had money, was motivated by fear of being bought themselves, and was clueless on how to run a mass market automaker like Chrysler. A bad combination every time.
        • 5 Years Ago
        Not True. Not even remotely true. If you look at the offerings of Chrysler in the 80's vis a vie it competitors in North America (foreign and domestic) you will find plenty of competitive vehicles. If you do the same in the 90's you find vehicles that were well recieved by the auto press AND increased market share as well as profits. I know it's popular right now to diss Chrysler, and they certainly have brought much of it on themselvs but you can't win awards, get rave reviews, increase market share, and make huge profits on smoke and mirrors. And that's exactly what they did in the 90's. Daimler had money, was motivated by fear of being bought themselves, and was clueless on how to run a mass market automaker like Chrysler. A bad combination every time.
        • 5 Years Ago
        Chrysler made awful products long before Daimler was involved.
      • 5 Years Ago
      I wonder how long before Daimler canibalizes Tesla and leaves the company to rot like they did with Chrysler...
      • 5 Years Ago
      Like most silicon valley companies you either:
      a. make it big (intel/google/oracle/sybase/ebay/facebook/yahoo--sort of)
      b. sell out

      It the nature of the business, nearly all companies start from seed investment funding, and Telsa is no stranger and 'typical'.

      Daimler will either:
      a. buy the company eventually and then hand it off to other companies like a hot potato among high tech portfolios. Pets.com is going through (remember them?) this as an example.
      b. take all the IP from Telsa (R&D IP), and exploit it in MB products, then sell the stake. That's what they did with Chrysler and from the mismanagement in the process became a driving factor to their Chap 11 situation now. Where does Tesla ends up? Like SGI...

      It's a win-win for Daimler, Musk and his investors. For Telsa workers & midlevel management, Daimler R&D and Telsa owners, their screwed. This happens every time with a valley company, every time.

      As for EV standards? Either Daimler heads up a new industry group using Tesla IP (doubt it due to licensing royalities) or the big 5 figure out another way. The blu-ray, HD-DVD scenario looks very likely for EV standards...
      • 5 Years Ago
      Announced the same day that Obama announces drastic changes to CAFE. Coincidence?

      BMW will buy Fisker tomorrow.
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