The on again, off again love affair between Daimler and Tesla seems to warming up again and Elon Musk and Tesla fans couldn’t ask for better timing. At a press briefing in NY this week, Daimler CFO Bodo Uebber, confirmed he has urged his team to “learn more from Telsa”
Early on, Daimler took a 10% equity stake in Tesla (since sold down to 4.3%), providing the company not only with much-needed capital but two more important assets; legitimacy and orders for the SmartForTwo and B-Class. Along with Toyota, Daimler hedged it’s entry into the electric market via Telsa with a smaller order for 2400 Rav4 E.
It strikes me as interesting that this comment comes on the heels of an announcement from Thomas Weber, Daimler’s Head of R&D that the company would deepen its relationship with Renault/Nissan on electric cars. Weber announced in February that Daimler would develop motors and Renault supply batteries for the Twingo and Smart products.
When Daimler entered into the Renault-Nissan Alliance capital structure (in 2010 Nissan and Daimler swapped 3.1% holdings) the three committed to leveraging the Renault-Nissan head start on electric vehicles and both companies fuel cell R&D.
Without offering any answers, this begs a couple of questions.
- Is Daimler satisfied with its electric partnership with Renault and Nissan?
- Is Daimler looking to up the ante and ask Tesla to do more products for the Mercedes brand?
- Is the RNO/NIS/DAI Alliance team interested in Tesla for Mercedes, Renault and perhaps Infiniti brands?
Daimler has been the gold standard of German engineering for more than a century and on the electric front they’ve taken a beating lately. Fawning press reviews of BMW’s strong move with i3 and i8, combined with Tesla’s ambitious prediction of selling 10,000 units a year in Germany alone are certainly making the R&D teams publicly uncomfortable.
I think most reasonable industry analysts would agree that the Alliance target of having a commercially viable fuel cell product by 2017 is yet another false deadline. So is this just public positioning or a glimpse of Daimler looking to play all its cars to catch up on the press game?
Bottom line: For Daimler, Renault, Nissan and Toyota this all a press game. Whether they play well together and build their relationships won’t have a material impact on the value of their business.
- Renault and Nissan are in big on investment for electric technology, especially battery production and sure could use some friends to absorb the 500 thousand units of capacity they planned to bring online, however, they can absorb the shortfall resulting from over exuberant planning.
- The interesting point here is for Tesla. However be careful. I’ve never been a believer in GEN3 numbers for Tesla and I chose to not get into the debate of valuation. But in terms of short-term perception this could obfuscate the clear mid and long-term risks. With the big guys knocking on their door and Q3 production likely higher than expected, fewer and fewer people are going to be looking the feasibility of 2015 costs and 2017 volumes.