Daimler, Toyota Get Rich Off Tesla

2 years ago by Mark Kane 17

Mercedes-Benz B-Class Electric Drive: Image Credit: Tom Moloughney

Mercedes-Benz B-Class Electric Drive: Image Credit: Tom Moloughney

Toyota RAV4 EV

Toyota RAV4 EV

In one of its recent articles, financial site The Motley Fool, notes that Daimler and Toyota earned hundreds of millions of dollars on Tesla Motors.

Both companies invested ~ $50 million early on (Daimler in May 2009 and Toyota in July 2010) and sold the stock in October 2014. Value at sale for Daimler was about $830 million, while Toyota got $692 million (estimated by The Motley Fool).

In total, Daimler and Toyota made $1.5 billion from the Tesla Motors’ stock rush.

“Amazingly, each company made a bigger profit from Tesla Motors than Tesla Motors has ever made itself — even though neither company seemed keen on being a long-term partner for the electric-vehicle upstart.”

Daimler used Tesla in the early pilot smart ED projects, and later in the Mercedes-Benz B-Class Electric Drive, but next generation EVs will be developed in-house. Toyota used Tesla to introduce the compliance RAV4 EV, but the project ended and the Japanese carmaker is now focused on FCVs.

For all parties, deals were win-win, as Daimler and Toyota got their EVs to the market quicker when needed and earned a small fortune, which probably covered all those project’s costs. At the same time, Tesla Motors was rescued from pending bankruptcy, got financing, credibility of supplier status and also earned on producing componentry for Daimler and Toyota.

It is too bad all deals in the EV space don’t go as well as this.

In the long run, all three will be competing for future consumer’s money, not only in cars but in case of Daimler and Tesla, energy storage systems too.

Source: The Motley Fool

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17 responses to "Daimler, Toyota Get Rich Off Tesla"

  1. ffbj says:

    And now Toyota is blowing a portion of the money they made investing in Tesla by throwing it at creating the FCV albatross that is hung around their neck.

    1. Texas FFE says:

      You shouldn’t be bashing fuel cell vehicles all the time. To get beyond climate change and establish long term energy security we need to adopt an all-of-the-above approach. The biggest advantages electric cars have right now is the charging infrastructure and the ability to home charge. If the oil companies had invested in hydrogen fueling infrastructure early adopters might be driving hydrogen cars instead of electric cars. Hydrogen proponent still believe that electrication is the road that leads to the hydrogen economy.

      1. ffbj says:

        I just think its a waste of money throwing cash at an also ran technology. I don’t bash FC all the time, in fact for certain applications they are extremely useful, just not for passenger vehicles.

      2. RexxSee says:

        Most of the hydrogen is obtained from fracked natural gas, it emits methane all over the billions of leaks of the distribution chain, and the reforming of methane to hydrogen emits CO².
        The process is 3 times more wasteful than charging batteries directly. It’s a lose-lose for the planet, the atmosphere, the customer, the incumbent, the safety. The only winner would be the hydrocarbon companies keeping us again captives of the yoyo-priced distribution infrastructures.

      3. G. Jumper says:

        Isn’t a fcv an electric car? What does the reaction create? Electricity does it not? And does an fcv have a lithium bsttery? Yes it does.

        1. SJC says:

          With an FCHEV you have a smaller fuel cell with more batteries. Add liquid fuel reformer then you never have to plug it in.

      4. Pushmi-Pullyu says:

        Texas FFE said:

        “To get beyond climate change and establish long term energy security we need to adopt an To get beyond climate change and establish long term energy security we need to adopt an all-of-the-above approach..”

        An “all-of-the-above approach” should not include attempts to develop technologies which physics, and the Laws of Thermodynamics, mandate can never be practical. This would include perpetual motion devices as well as the “hydrogen economy”. In both cases, you’d have to repeal the Laws of Thermodynamics for it to work in a practical manner.

        It seems strange that there are so many people who can’t seem to grasp this basic concept. Presumably most of them would not advocate that Toyota should be trying to develop a perpetual motion machine.

        1. Martin T. says:

          100% right on, Making hydrogen wastes a lot of energy.
          Should have been shelved years ago.

  2. tftf says:

    Daimler saved Tesla in early 2009 when it was days aways from bankruptcy.

    Tesla wouldn’t even exist today without Daimler saving them:

    http://finance.yahoo.com/news/daimler-saved-tesla-paved-way-174343218.html

    1. Rick Danger says:

      We know all of that. Tesla survived and Daimler made @ $780 million. That’s why Mark called it a win-win.
      Other than yet another feeble, impotent attempt at Tesla bashing, what’s your point?

      1. tftf says:

        We also know that there are many commenters claiming “ICE car makers are in bed with oil companies”.

        It’s therefore worth re-iterating to all conspiracy theorists that an ICE car company saved Tesla.

        1. tftf says:

          PS: It’s also worth remembering that car companies make money selling/leasing cars and assoicated services, NOT oil/gasoline.

          1. Djoni says:

            And investing in promising new tech they think didn’t have enough value to promote it themselve.
            Is this a magic circle?

            1. tftf says:

              @Djoni, what until ca. 2018-2020 and you will see that most of the big car makers will offer a wide range of longer-range EVs and PHEvs.

              They just time their market entry as battery prices and specs keep improving.

              Nissan-Renault, the exception to the rule, lost of a lot of money so far (writedowns since 2011) by going into EVs very early.

        2. Pushmi-Pullyu says:

          tftf said:

          “We also know that there are many commenters claiming ‘ICE car makers are in bed with oil companies’.

          “It’s therefore worth re-iterating to all conspiracy theorists that an ICE car company saved Tesla.”

          I don’t see that the former precludes the latter, or even makes it less likely. If legacy auto makers are “in bed” with Big Oil, it’s because they think it benefits their bottom line. Presumably Toyota invested in Tesla because, again, they thought it would benefit their bottom line… and it certainly has!

          The problem comes when idealists assume that most or all of what motivates everybody is philosophical motives, just because they see themselves as doing things mostly for philosophical or idealistic reasons. A more objective, more realistic analysis of actions and their motives would reveal that the actions of even self-described idealists mostly have practical and/or self-serving motives, and so do the actions of those companies and individuals who they are idealistically opposed to.

          Well, that was perhaps too cerebral an observation, so to give an example:

          Big Oil companies don’t fight attempts to reduce pollution, nor fight attempts to promote electric vehicles, because they are evil and they want to destroy the world. They do it because selling oil is how they make enormous amounts of money, they want to keep doing that, and any movement towards reducing the pollution emitted by burning petroleum distillates will cut into their profits.

    2. The Woodster says:

      The Daimler investment in Tesla reminds me of Microsoft’s investment in Apple back in 1997:

      http://www.engadget.com/2014/05/20/what-ever-became-of-microsofts-150-million-investment-in-apple/

      It’s different because there are so many more players in the automotive space, but there may be long term parallels if Tesla becomes a major automobile company over the next decade or more.

  3. Grendal says:

    Just a reminder that Daimler sold off a large chunk of their stake in early 2012. If they had held that stock for two more years they would have made an additional $800 million.