[ad#post_ad]Just a few weeks ago California governor Arnold Schwarzenegger, stood at a podium between Toyota CEO Aiko Toyoda and Tesla’s Elon Musk in California and announced a deal between the two companies to collaborate on the production and development of EVs at the NUMMI facility in Palo Alto.
It was further billed as also involving parts and engineering support, with engineers between Toyota and Tesla reportedly meeting together. At that time, speculation naturally jumped to the assumption that someday we would be seeing a joint effort between the two.
Since that media conference in late May, it has been a bumpy road for Tesla and its CEO. For starters, it turned out that Toyota’s 50 million dollar investment in the company had some strings…like being contingent on a successful IPO before the end of the year.
Then came news from court papers filed in Elon Musk’s highly publicized divorce, that his wife Justine wants a big chunk of the company, which was followed by a even bigger revelation, that Elon Musk himself was completely broke. “About four months ago, I ran out of cash,” Musk declared. “I had to obtain emergency loans from personal friends. These loans are the exclusive source of cash I have. If I did not take these loans, I would have no liquid assets left.”
And in between all of that Tesla announced it lost another 29.5 million dollars in the first quarter of 2010. One wonders how they retained a 465 million dollar loan facility from the Department of Energy while GM still has yet to qualify based on their ‘viability.’
It has become obvious that Tesla’s only path to stay in business is paved by government funding and good PR, rather than by actually building electric cars for a profit.
Now this week comes the news that there really is no collaboration between Toyota and Tesla to build electric vehicles. In fact there is no deal in place on synergies or sharing of technology. What had originally been billed as a partnership that would be great for Tesla to gain access to Toyota’s huge/low cost manufacturing base, and for Toyota to get its foot in the door making pure BEVs in North America, it seems has turned into purely a stock deal. Perhaps in part to Toyota not being interesting in being involved with Tesla Motors now that the circus has come to town of late.
At best, Toyota and Tesla may be putting out a one-off EV prototype at some point in 2011 if the deal goes through…just to show they the world they are co-existing, and to keep the PR train rolling for Toyota’s 50 million dollar investment in Tesla.
Tesla’s amended S-1 filing pretty much says it all:
“In May 2010, Tesla and Toyota Motor Corporation, or Toyota, announced their intention to cooperate on the development of electric vehicles, and for Tesla to receive Toyota’s support with sourcing parts and production and engineering expertise for the Model S. However, we have not entered into any agreements with Toyota for any such arrangements, including any purchase orders, and we may never do so.”
Through March of this year, Tesla has lost 290 million dollars while building 1,063 Roadsters (don’t do that math on that one). However they do predict a profit in 2013. /I predict they go bankrupt.
UPDATE: Tesla has just announced their IPO today. The company expects to sell 11.1 million shares as high as $16 a piece, raising almost 180 million dollars. After it closes, Toyota would then make their 50 million dollar investment in the company. You will be able to follow Tesla’s day to day market moves under the symbol TSLA. The company also issued a statement about profitability, “We will continue to incur operating and net losses each quarter until at least the time we begin significant deliveries of the Model S, which is not expected to occur until 2012, and may occur later.” /where do I sign up