In a surprise announcement, Toyota Motor Corporation and Tesla Motors have entered a partnership to build electric vehicles, parts, and provide engineering support. Toyota will also retain $50 million of Tesla’s common stock issued in a private placement to close immediately subsequent to the closing of Tesla’s currently planned IPO.
The deal also resulted with Tesla purchasing the recently shuttered NUMMI factory in Fremont, California, which had been a joint venture between Toyota and General Motors. NUMMI will now be used to build the Tesla Model S sedan and other vehicles from the EV start-up.
“The Tesla Factory effectively leverages an ideal combination of hardcore Silicon Valley engineering talent, traditional automotive engineering talent and the proven Toyota production system,” said Musk. “The new Tesla Factory will give us plenty of room to grow.”
According to Tesla, the upcoming Model S will be the first all-electric premium sedan designed from the group up. It will have a range of 160 miles and be able to travel from 0-60 mph in 5.6 seconds before reaching a top speed of 130 mph. When federal tax credits are applied, the Tesla Model S will start at just under $50K.
“I sensed the great potential of Tesla’s technology and was impressed by its dedication to monozukuri (Toyota’s approach to manufacturing),” said Toyota Motor Compnay President Akio Toyoda.
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