Toyota Motor Co., an automaker known for its commitment to hybrid technology, announced it is buying a $50 million stake in Tesla Motor Co., a maker of pure electric cars.
Bloomberg Businessweek.com said earlier today that the two companies plan to cooperate in “developing electric cars, parts, production systems and engineering.” As part of the deal, Tesla will buy a closed Toyota joint-venture plant in California to build its Model S, a big electric car said to have a 300-mile range.
The move comes as a surprise to many in the auto industry. In earlier statements, Toyota has indicated that it believes the auto industry’s future is in hybrids, not pure electrics. During an interview with Design News at the North American International Auto Show in January, a Toyota spokesman acknowledged that the company planned to roll out a “small urban commuter” EV in 2012, but added that Toyota is “basically a very conservative company” that only sells products that can be sold in high volume.
“We did that once with the RAV4 and the world wasn’t ready,” the Toyota spokesman said, referring to Toyota’s foray into electrics a decade ago. “We sold about 500 a year. The batteries were hideously expensive.”
Two Toyota spokesmen then added that even today, electric car batteries cost approximately $1,000 to $1,200 per kilowatt-hour, making them unsuitable as a powertrain alternative.
Yesterday, however, Toyota was far more upbeat about pure electric vehicle technology. “I’ve felt an infinite possibility about Tesla’s technology and its dedication to monozukuri,” said Toyota president Akio Toyoda, in a statement published on the Tesla website. “Through this partnership, by working together with a venture business such as Tesla, Toyota would like to learn from the challenging spirit, quick decision-making, and flexibility that Tesla has. Decades ago, Toyota was also born as a venture business. By partnering with Tesla, my hope is that all Toyota employees will recall that ‘venture business spirit,’ and take on the challenges of the future.”