Home / Automotive, Other / Toyota & Tesla’s $50 million Partnership

Toyota & Tesla’s $50 million Partnership

Original Source: http://www.sustainablelifemedia.com
Author: Thomas Miner
Original Publication Date: May 25, 2010

May 25, 2010 – The Japanese auto giant, who was a first-mover in the hybrid automobile market and plans to offer its own plug-in hybrid by 2012, will be investing $50 million in the Silicon Valley-startup as part of a deal which includes Tesla taking a stake in the recently closed NUMMI manufacturing plant to increase capacity for its new sedan.

The partnership comes at the right time for Tesla, who is in need of the additional cash flow after losing $59 million in 2009. The company has also been searching for a location to manufacture their new Model S sedan, a more affordable vehicle ($49,900) than their only current model – the Roadster ($109,000). The recently closed New United Motor Manufacturing Inc. (NUMMI) facility, a joint venture between General Motors and Toyota, provides the ideal environment for Tesla’s new manufacturing site.

The NUMMI plant had been in operation since 1984, and housed GM’s Pontiac Vibe production line as well as Toyota’s Corolla and Tacoma lines. When GM filed for bankruptcy last year, Toyota could not operate the plant alone and closed its doors last month. Because the deal includes some revitalization to the NUMMI plant it should help to bolster Toyota’s image, especially in California where the plant was located.

Elon Musk, CEO of Tesla, said that he believes there is huge potential for long-term growth opportunities through the partnership, and that the companies could create 10,000 new jobs throughout the supply chain.  He predicts that the facility will add 50 workers each month while the company ramps up for the Model S launch in 2012.

 Retweet This Post