Tesla Motors said earlier this month that the agreement it has with Toyota to supply battery packs for the Toyota RAV4 EV SUV would be finished by the end of the year. The deal is done, but Toyota is now singing its best version of Baby, Please Don't Go.

The Japanese automaker may look to extend the battery-pack agreement with California-based Tesla, Automotive News says, citing comments made by Osamu Nagata, who heads Toyota's manufacturing and engineering in North America. Nagata also complimented Tesla for its "clear business strategy." Toyota, which owns 2.5 percent of Tesla, started the RAV4 EV collaboration in 2012, in which Tesla was to make about 2,600 battery packs for the all-electric SUV. That agreement was estimated to be worth about $100 million.

"We are also evaluating the RAV4 EV program and will have more to say at a later date" – Toyota

"We have a good relationship with Tesla and will evaluate the feasibility of working together on future projects," Toyota said in a statement e-mailed to AutoblogGreen. "We are also evaluating the RAV4 EV program and will have more to say at a later date."

And while Toyota hasn't quite met initial sales expectations – it sold about 1,600 of the RAV4 EVs through this spring – the company expects to reach 2,500 by the end of the year. And the partnership did generate about $15 million in revenue for Tesla, according to that company's first-quarter letter to shareholders. That said, Tesla is obviously focusing its battery-making efforts on its own models.


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  • 32 Comments
      SublimeKnight
      • 6 Months Ago
      I'm sure they never intended to go away from Tesla as a supplier. They just did this in an attempt to gain an advantage in renegotiating the pricing.
      HV
      • 6 Months Ago
      I wish I kept the letter I got a number of years ago late 90's or early 2000's "Do to lack of interest we will no longer sell EV's" That was a lie!!! Now they promised us that we all could get a RAV 4 EV a dealer in NJ told me that they had numerous people want them and would buy on ASAP. They even showed it at the NY car show last month and claimed we could get one. When??? Where??? but wait the price is $50,000 I could put that up on a base Tesla Model S or a BMW i3 which has a lot of interest. What happened to the two electric Lexus RX's they got we were promised them several years ago. I may just get a BMW i3 though a Toyota is better engineered.
        purrpullberra
        • 6 Months Ago
        @HV
        I hear you. I'd probably have to buy a Spark EV if it were for sale in WA. I'd actually buy from a dealership! Why won't they sell them here? Fiat 500 too? I know they'll lose money. They should suck it up. They're basically ADS to those in the know, how hard is it to justify looking at it that way? Sell them in Atlanta since they buy so many EV's. In WA too. Sell them to those that want them and success can follow. BTW: even as a Tesla lover and shareholder go ahead and get an i3, they look crazy good if you're not ready to commit to the ModelS.
        Marco Polo
        • 6 Months Ago
        @HV
        @ HV "That was a lie!!!" What's with all the indignation ? Relax, companies, like people, change their minds as new developments occur. What seems to be a lot of demand at the NY car show, may not be substantiated by more comprehensive research. In the end, it's you the consumer who decides what you will buy to suit your personal needs.
      Grendal
      • 6 Months Ago
      No one has mentioned that Tesla has stated that they will be building 500K battery packs out of the gigafactory and I'm certain that Toyota would be happy to have access to some relatively cheap packs when they come available. It is in their future interest to maintain really good relations with Tesla.
      jeff
      • 6 Months Ago
      Short answer: We realized that Hydrogen is not viable and we still need ZEV credits...
        Jon
        • 6 Months Ago
        @jeff
        Nothing has changed. The plan has always been sell a few compliance cars for ZEV credits to meet current regulations and keep everyone mystified by hydrogen that "coming soon" but never quite ready so they can continue collecting government research money while avoiding further ZEV mandates.
        Grendal
        • 6 Months Ago
        @jeff
        Longer answer: We're going to chase every option and get as much government subsidy and support as possible. The companies really don't know ahead of time what the government will shove down their throat.
      JakeY
      • 6 Months Ago
      If they are going to work on another project, put it in a more updated car. And they need to really evaluate their sales strategy (whatever they did with the RAV4 EV obviously didn't work). I guess this is them hedging their bets in case their proposed HFCV flops and can't even sell/lease the couple hundred that they need for their ZEV requirements.
        Spec
        • 6 Months Ago
        @JakeY
        The car, although well loved by the owners, apparently did have some problems. Some power electronics, some charging issues, a clock issue, etc. I'm sure if these problems were from Tesla or Toyota.
        eric
        • 6 Months Ago
        @JakeY
        What they did with the RAV4 didn't work because they overcharged for it, and then there were horror stories about dealerships treating the owners/lessees like crap, and only having a limited number of trained dealerships where they could be serviced. For shame, Toyota.
      NestT
      • 6 Months Ago
      All the battery cells used for the RAV4EV program are battery cells that are not being used to sell more Model S. I would wager Tesla makes more money selling Model S to the public than powertrains to Toyota. In 2012, it really helped Tesla to be validated by Toyota with the investment into Tesla and the purchase of Tesla technology. That is no longer needed.
      eric
      • 6 Months Ago
      Toyota has drunk the HFCV Kool-aid. And though they might be backpedaling a little bit, I think there will have to be something close to a bankruptcy before they realize they've backed the wrong horse.
        Spec
        • 6 Months Ago
        @eric
        Naw, I'm sure Toyota has both active FCV and EV programs. They are emphasizing the FCV program right now and taking a gamble on it. But if it flops, the skunkworks EV program will replace it. You gotta realize that both of these programs combined make up less than 1% of their vehicles, so it is nothing at this point.
          eric
          • 6 Months Ago
          @Spec
          I hope you're right. I'm really tired of seeing HFCV getting emphasized as the next big thing in cars, and always 10-15 years down the road. EV's and EREV's fill 99.999999% of drivers needs now, and the infrastructure is there. No need for oil companies to crack fossil fuels into H2.
          JakeY
          • 6 Months Ago
          @Spec
          This is my exact guess too. Keeping an ongoing pack supply relationship with Tesla gives them a "plan B" in case the FCV program doesn't work out. "Plan C" is probably buying ZEV credits (which is kind of embarrassing at this point for such a large automaker).
      Joeviocoe
      • 6 Months Ago
      --"There are no fanatically passionate HFCV 'advocates'" Yes there are. EV fanatics are regular people, and the most fanatical can build an EV in their garage. FCV fanatics are working for CARB and CAFCP and lobbying the state and federal government for taxpayer money. Just because your fanatics have more money and power, doesn't make them any less fanatical... just that you won't hear them in the same grassroots forums. --" If it's decided that widespread HFCV is viable, the process will be undertaken, " Or decided that mere Research and Demo projects are a means for easy government grants... it will be (has already been) undertaken. --"a substantial 'breakthrough' in the ESD capacity occurs" Gradual improvements in ESD capacity is all that is needed. And this is being shown by the steady reduction in costs from EV automakers. --"but they are more versatile, and can potentially enable a much wider range of applications globally." How is hydrogen more versatile? It is grossly inefficient to produce via any means. The most efficient way is from a single source,.. Natural Gas. --"EV's are basically limited to passenger cars, and two-wheel vehicles in affluent urban situations." There you go again... comparing Hydrogen's "future, someday, if H2 stations are everywhere Potential" with a very narrow minded, short sighted "yesterday's" view of BEVs. EVs have ALREADY moved beyond "affluent urban situations"... well into the suburbs and middle class. Yet, FCVs have not even moved beyond automaker selected folks with demonstration leases in Los Angeles. --" HFCV technology is something to be passionately opposed. " Nope, we see the gross amount of taxpayer money being thrown at Hydrogen, as something to be opposed.
      David Murray
      • 6 Months Ago
      If my math is correct, $100 million divided by 2,600 battery packs means each battery pack costs $38,461. I'd guess that is the reason the RAV4 EV costs so much.
        JakeY
        • 6 Months Ago
        @David Murray
        The $100 million includes a lot more than the battery pack. It's the entire powertrain: battery pack, charging system, inverter, motor, gearbox and software. Tesla also supplies warranty service for the powertrain. http://www.plugincars.com/servicing-big-issue-toyota-rav4-ev-especially-outside-california-129402.html
        Joeviocoe
        • 6 Months Ago
        @David Murray
        Well, there is a lot more equipment than just the packs. All the service related items, diagnostics, and handling equipment for large packs, must be sent out to select California Toyota service centers. The $100 million... is not likely JUST for the packs. I would think ~10-30% could be for other things. There is a reason why there is so much cost savings by doing things "in house".
      Marco Polo
      • 6 Months Ago
      @ purrpullberra HFCV's are nowhere near as elegant as EV's in producing Zero emission vehicles, but they are more versatile, and can potentially enable a much wider range of applications globally. Both technologies currently have limitations. EV's are basically limited to passenger cars, and two-wheel vehicles in affluent urban situations. HFCV technology can operate heavy transport as well as passenger vehicles, but needs infrastructure on the scale of the existing gasoline/diesel network. For HFCV stakeholders, the fact that HFCV technology is less disruptive, and more easily imposed on a global scale, is very attractive.. To the public, it's just a matter of "switching" to a "zero emission " fuel. Of course, for those EV fans who see EV's in terms of a social revolution, (or a hatred of oil companies) HFCV technology is something to be passionately opposed. But for realistic environmentalists, choosing sides isn't easy, since HFCV technology could potentially reduce transport pollution on an unprecedented scale far more quickly. But, IMHO, everything depends on those researchers successfully developing a breakthrough in ESD technology.
      Joeviocoe
      • 6 Months Ago
      --"There are no fanatically passionate HFCV 'advocates'" Yes there are. EV fanatics are regular people, and the most fanatical can build an EV in their garage. FCV fanatics are working for CARB and CAFCP and lobbying the state and federal government for taxpayer money. Just because your fanatics have more money and power, doesn't make them any less fanatical... just that you won't hear them in the same grassroots forums. --" If it's decided that widespread HFCV is viable, the process will be undertaken, " Or decided that mere Research and Demo projects are a means for easy government grants... it will be (has already been) undertaken. --"a substantial 'breakthrough' in the ESD capacity occurs" Gradual improvements in ESD capacity is all that is needed. And this is being shown by the steady reduction in costs from EV automakers. --"but they are more versatile, and can potentially enable a much wider range of applications globally." How is hydrogen more versatile? It is grossly inefficient to produce via any means. The most efficient way is from a single source,.. Natural Gas. --"EV's are basically limited to passenger cars, and two-wheel vehicles in affluent urban situations." There you go again... comparing Hydrogen's "future, someday, if H2 stations are everywhere Potential" with a very narrow minded, short sighted "yesterday's" view of BEVs. EVs have ALREADY moved beyond "affluent urban situations"... well into the suburbs and middle class. Yet, FCVs have not even moved beyond automaker selected folks with demonstration leases in Los Angeles. --" HFCV technology is something to be passionately opposed. " Nope, we see the gross amount of taxpayer money being thrown at Hydrogen, as something to be opposed.
      purrpullberra
      • 6 Months Ago
      I think you're right. Personally, I'd love to see hydrogen catch on in what (I see as) smart ways like focusing selling the cars to folks at large universities, large industrial complexes and national labs. These locations already need hydrogen production for various reasons. I love high tech and these fuel cells can be quite ingenious. I'm just unconvinced that the general public needs to be invited to take part in the experiment yet. That would strike me as waste. The current focus on general sales is why I'm not an hydrogen optimist. Is the fuel cell and fuel ever going to weigh less than the batteries of EV's? That's the race, huh? Refueling times next most important maybe? Safety 3rd. FWIW I hope I'm wrong about hydrogen. It's far better than burning oil.
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