Daimler grabs Tesla stake in electric-car push

German automotive giant Daimler has invested in electric-car company Tesla Motors and plans to use Tesla's battery packs in its Smart electric car due later this year.

At a Tuesday press conference held at the Daimler museum in Stuttgart, Germany, Tesla CEO Elon Musk and Daimler management board member Thomas Weber said the contract between the two companies calls for joint collaboration on the Smart electric car and future models.

Daimler has invested a "double-digit million-dollar sum" to acquire about a 10 percent stake in California-based Tesla, Weber said.

An electric Smart car being tested in Berlin as part of an electric-car trial.

(Credit: Daimler)

"We are about to combine the best of the old and new school," Weber said during a press conference, which was Webcast. "We are both deeply convinced that electric powertrains will play a major role in sustainability mobility."

The two companies last year announced that Tesla would supply the lithium ion battery for the Electric Smart EV, a small town car. Telsa designs and makes the packs using battery cells used in consumer electronics.

Daimler plans to test those cars this year and to mass-produce the Electric Smart EV in 2012, Weber said.

The company, which has been working on electric-vehicle technology since the 1970s, chose to partner and invest in Tesla to help Daimler bring cars to market quickly, Weber added. "The first priority was to find the quickest and most straightforward solution," he said.

The technical collaboration calls for Tesla to supply battery packs and electric powertrain, and for Daimler to offer auto manufacturing and design expertise in a range of areas, such as safety and mass production, Musk said during the press conference.

"We look forward to future areas (of collaboration)," Musk said. "Smart is just the beginning."

[vermonster59]

Let's hope Telsa fairs better in partnership w/ Daimler than Chrysler did! The lesson Chrysler learned the hard way is "don't let the Germans manage American businesses."

[Simplicius]

Right. Because Americans have done a great job at managing American businesses, especially banks, airlines, car and insurance companies.

[steaner]

Martin, it's Stuttgart.

[biffhenerson]

Tesla had a good thing. I hope that its association with Daimler doesn't ruin it by dumbing it down and producing something that knowone wants like the Big 3 do.

[SactoGuy018]

I think Daimler will fare far better with Tesla because Daimler wants the electric drive motor technology Tesla developed. Don't be surprised that the successor to the B-class hatchback now sold in Europe--which Daimler more or less confirmed is coming to the USA market--will include a PHEV or pure electric model using motors based on Tesla-patented designs. Tesla-designed motors could also be the basis for larger hybrids.

[theBike1945]

Apparently Daimler doesn't keep up with the latest battery technoogy.If they did, they would surely know that Tesla's battery packs are built from off-the-shelf batteries whose format was designed for laptops, not automobiles. Stuffing 8761 batteries into a car , as Tesla does with their Lotus designed and built roadster (Tesla doesn't actually manufacture anything - they are a company on paper only) is pretty hilarius. The act that Daimler would have anything to do with a company thisprimitive, using obsolete 1st generation li ion batteries, tells me a lot about how serious Daimler is about electric cars. By the time those EVs hit the sstreets, there will be fast rechargeable batteries available from A123 Systems,
making Daimler's efforts another giggantic blunder. They've already made several in the alternative energy arean with respect to hydrogen and natural gas. You'd think Daiimler would hire someone familiar with automotive electrification to guide them. But noooo ......
arena

[regulator1956]

"(Tesla doesn't actually manufacture anything - they are a company on paper only)"

You're pretty hilarious, and uninformed.

Telsa manufactures the roadster. What do you think they do, fold paper into a car?

Stacking batteries, designing the cooling and control systems is quite difficult. I hope A123 or someone comes out with something 100 times better, but Tesla has it TODAY.

[mike.gw]

I wish an American company had invested in Tesla. Regardless of what anyone thinks about their battery technology, Tesla is the first to have a useful, decent range electric vehicle on the road for (well off) consumers. Tesla could very well be the start of a new American auto industry, and I hate that Daimler has their mitts in them. Daimler acquired Chysler when Chrysler was profittable and Mercedes was in a slump. At the time, Chrysler had some of the freshest designs on the market. Daimler sucked the life and talent right out of Chrysler, and helped them to where they are now.

[leoashton_dotmac]

Complain all you want, but I love my Ford Escape Hybrid and it proves the Big 3 can (if they can still be called that) make a quality vehicle that people want in this country. I am not sure Tesla is going to prove it self a worthy company instead of just a Tech money pit, but more power to them, getting some assistance from a real-world automotive establishment could only help.

[Galactic Cannibal]

ML,
Has Telsa motors ever completed on-road tests of their battery packs to end-of -useful-life. Where can we see the results?

Lab testing or even simulated road testing does not represent the real world of driving the EV, until the batteries fail to deliver the published 300 MPC or the 240 MPC.

How does Telsa charge their battery packs to 80% SOC in 45 minutes.
That is impossible to do using a household power grid connection.
So when a person buys a Telsa EV, what does Telsa suggest they do to get the vehicles charged to 80% in 45 minutes?
Take the EV to a specially constructed 480V connection ....but where are these connections.

One may find 480V connections at SKY Harbor Airport in Phoenix where they fast charge EVs for service work on the airport.

And how long to charge Telsa battery packs to 100% SOC.

I can gas-up my Honda Ridgeline in less than 5 minutes to get 370 miles at 70 mph before my next 5 minute fill-up.

I am flabbergasted that none of the financial supporters of Telsa have not asked or demanded answers to critical issues on useful life of battery packs, and fast charging.

All the marketing hype in the world will not sustain any product when customers discover its short comings.
The EV graveyard is filled with high flying EV start ups, including GM's infamous EV1; they produced 1170 EV1's, and leased them. But finally took them back and crushed them.

Where does Telsa publish the "cost of maintenance" for their EVs, for example replacement battery packs, wear and tear and repair due to accidents.
I only wish Telsa great success. But unless Telsa can provide more real world performance testing on their battery packs, then down the road they will find plenty of room in the proverbial EV graveyard.
GC

[regulator1956]

You're Ridgeline was lab tested. Why did you buy it?

Seems like you're stating that Tesla should run a bunch of battery packs for 7 or 10 years before coming out with a car.

Rail against greatness all you want. Don't want it, don't buy it.

I drive 7 miles each way to work. Weekend jaunts are maybe 30 to 100 miles. I wouldn't take a Tesla sports coupe across the country, but the couple times a year I might need more juice wouldn't keep me from the 360 days I'm good with.

[gmhendo]

If you don't like other countries buying US companies, do you think it is OK for US to buy foreign companies? Its the same thing as Daimler buying into Tesla, only the boot is on the other foot.

And has US Corporate been really squeaky clean with it's overseas or domestic dealings over the years? No I don't think so. A brief look at GM's antics from around the 1920'2 to now era is instructive and disturbing. read "Zoom" , ISBN 978-0-141-03672-4

Life cycle thinking is good, about time we got into that. Recent scientific reports speak of Li-ion batteries with a working life in up to 150,000 miles, removing one of the EV's biggest worries, the need to buy expensive new batteries during the life of the vehicle.

About fast charging - firstly, love Big Oil, or hate them, they are still a powerful force and will oppose EV's as long as they have no profit in them. And consider the billions of dollars they have invested in gas stations; what will become of them if we all go electric? Well one suggestion is to let them run the 480 volt fast charge facility that you can't do from home - and why not if we can trust them not to screw us?
The other good thing about fast charge batteries is their regenerative ability. The Prius, when you back off the accelerator, returns energy to the batteries by re-charging them. They exchange the cars kinetic energy for electric energy. But only about 10% of what it could, because the batteries won't take any more. Fast Charge batteries will accept around 70% exchange, extending vehicle range and improving efficiency greatly.

So there is lots of good news...

[Galactic Cannibal]

regulator 1956:
The fact is that Tesla has not tested on-road,t their Lithium "off-the shelf" battery pack, to end of useful life That error will come back to haunt them and their few customers who can afford to buy the EVs. The public does not know that the weakest link in any battery is a connection. Telsa has cobbled together PC laptop type batteries with over 6,000 connections to make their battery packs . This is old hat battery technology and it trully boggles the mind that a German Auto Co would put a single Euro into such a near dinasour technology and aassembly. Hybrid elect/ICE vehicles are a stop gap until fuel cell technology can be economically applied to transport , eg cars trucks etc. But EVs powered by storeage devices (batteries ) are doomed by their physical/electrical limitations in EV applications. If U drive 7 miles each way to work . then safe ur money and buy a $5000 golf cart .

[ecotony]

It looks like you are missing the value on Tesla. Power train. Electronic speed control. Battery cooling. Battery monitoring/controling. All these are the really important stuff to make an electric car work. The fact they can connect that many packs in series and in parallel and not have them fail faster is the miracle and the beauty in their technology.
That technology is what lets them be confident in their real-world usage. They are able to let each cell act like a single cell, which is real-world tested.
Better cells will arrive. But Tesla's ability to string together whatever the next generation cells are without them overheating will be their strength.

[forested665]

Chrysler had tons of money in reserve before Diamler got hold of them.
They run over half their designers off, then laid off the ones they didnt like.
They blew through the cash reserves rebuilding factories for new cars instead of modifying existing equipment. Then to beat it all when chrysler sales dropped they made the same Pre K car mistakes.
They dropped the LHS 300M and 300c to bring out that hemi powered 300.
They stopped selling the concord and then later theyre #1 seller the neon.
Brought in the caliber which most people hated esp compared to the neon.
The crossfire was released and way over priced with a small market target.

Only real improvement diamler made was in the jeep division but then safety went down the drain.

[beijingruud]

Can anyone be positive? In a world where battery car technology is in its infancy, combining and sharing the R&D efforts of a big euro car maker (known for being at forefront of many car inventions) with a start-up type US based near internet company (I do not say start-up) is a good thing.

Smart is just one step, forget about the Chrysler story (this is not the first time they are in trouble) and focus on the future.

[gmhendo]

Fair comment mate.