Tesla Gets $50m Leg Up From Toyota

Deal ensures Model S sports saloon will appear in 2012

By Chris-R / Friday, 21 May 2010 / Loading comments

Toyota is investing in the Tesla Model S

Tesla has sold a $50m slice of itself to Toyota, giving it access to a mothballed factory belonging to the Japanese giant in California - and presumably all sorts of additional advantages in logistics, production and distribution.

Now run by Paypal founder Elon Musk, some commentators say Tesla appears to have struggled with supply chain and cost issues in the past, so the Toyota tie-in should give the company a big leg-up. The plan is to introduce the new Tesla Model S saloon at the Fremont, CA factory, with initial volumes of 20,000 cars a year promised from 2012.

Musk has always had a grand vision for Tesla, and reckons that as the plant expands it could employ up to 10,000 workers - but only 1,000 will be required for it to build the Tesla S initially.

It should now appear in 2012

Of considerable interest is Toyota's motivation for stepping in at short notice, in a deal further sweetened by tax sweeteners for Tesla's capital investment at the factory that was brokered through the office of California governor, Mr Arnold Schwarzenegger.

Toyota already considers itself to be a global leader in hybrid/alternative technology, and popping $50m into Tesla's back pocket could never have been part of its own strategic plans.

Which leaves us wondering if the Japanese company, still reeling from its recall nightmare in the US, would have given a pot of gold to anyone offering a loved-up photo-op with Arnie?