I have done several posts on this company.....actually they have not been very popular. Most people are not aware of the name. I have predicted that they will become a household name within two years. The reason I made that statement is that they have the best battery technology of any of the auto manufacturers. If I were in the auto business.....I would be trying to buy them or at a minimum access that technology. Currently, Tesla is not a public company, but if I they came out with a public offering .....I would be first in line for some shares.
Daimler (Mercedes) has done just that....they have acquired a 10% stake in Tesla. The deal was not disclosed but was priced at eight figures in Euros....$20 million minimum. This deal could give Mercedes a leg up on their European competition.
In January, Mercedes selected Tesla to provide batteries and charges for their Smart EV. Tesla has agreed to supply 1000 batteries within the next two years. It gives them access to the most advanced electric car manufacturer in the world. It is anticipated that Mercedes and Tesla will work collectively on battery systems, electric drive systems, and electric cars in development.
One of the weaknesses of German cars has been their electronics. Typically, the Japanese and American manufacturers produce cars with fewer electronic problems.
The Mercedes deal also has advantages for Tesla accessing Mercedes engineering production and supply chain management. Translated it means that Tesla will have access to German engineering for setting up the factory for the new Model S, and access to parts suppliers.
Obviously, the Germans are very good business people....this is an exceptional deal for Mercedes. They were looking out for their strategic interests. The car business is done in billions of dollars, so this is a cheap investment in the future.
It gives Tesla help in building the factory for the Model S and some cash until federal loans are approved.