Daimler, Tesla Hook Up: Daimler acquires 10pct stake

Daimler AG and Tesla Motors, Inc. have formally entered a joint venture to accelerate industrialization of the lithium-ion battery. In making the announcement this week, Daimler also revealed that it had acquired a 10pct equity stake in the California electric car manufacturer.

"Our strategic partnership is an important step to accelerate the commercialization of electric drives globally," said Thomas Weber, Daimler's head of research. Daimler is vying for world leadership in the industrialization of lithium-ion technology.

Tesla is the manufacturer of the only production street-legal electric vehicle sold in Europe and North America - the Tesla Roadster - and recently introduced the Model S scheduled for production in 2011.

Tesla CEO Elon Musk said, "We are looking forward to a strategic cooperation in a number of areas including leveraging Daimler's engineering, production and supply chain expertise. This will accelerate bringing our Tesla Model S to production." As part of the agreement, Tesla has awarded a board seat to Herbert Kohler, Daimler's vp of E-Drive and Future Mobility.

One frontline project will be the installation of the Tesla battery packs and charging systems in 1,000 smart fortwo microcars later this year at the Smart assembly plant in Hambach, France. Given the performance capabilities of the Tesla Roadster, Musk quipped that a Smart that goes "like a bat out of hell" could be in the cards.

Daimler has had 100 electric smarts in a test program in London since 2007 and will use the new batch for other test programs in Berlin and Italy. Besides individual vehicle projects, the collaboration will extend to the development of battery and electric drive systems. Tesla is interested in Daimler's lithium-ion pouch-cell battery.