Tesla has become the world reference in the electric vehicle niche.
The company and its whimsical and visionary CEO Elon Musk have become symbols of the automotive sector’s decline in CO2 emissions.
The automaker currently produces more than 1.37 million electric vehicles per year, digging a huge hole with its competitors. It is profitable at margins that make its competitors pale with envy.
The market cap reached $1 trillion in 2021 before collapsing to almost $390 billion currently. No other automotive group comes close. Toyota (TM) – Get a free reportthe world’s largest auto group in terms of production volumes, has a market value of $191 billion, while Volkswagen (VWAGIE) – Get a free report has a market value of approximately $83 billion. ford (F) – Get a free report and General Motors (GM) – Get a free report have a market cap of $51 billion and $52 billion, respectively.
GM and Chrysler went bankrupt
Tesla (TSLA) – Get a free report has four auto plants — Fremont, California; Austin, Texas; Shanghai and a fourth near Berlin. The company could announce site names of new vehicle assembly locations in the coming weeks.
Tesla currently markets five models: the entry-level Model 3 sedan, the Model Y SUV/crossover, the Model S luxury sedan, the Model X luxury SUV/crossover, and the Tesla Semi. This year, a new model, the Cybertruck, should be added to this list that continues to grow.
What many forget is that Tesla would have simply disappeared 14 years ago. It was in 2009, in the middle of a financial crisis. Six years after Tesla’s founding, the automaker and its co-founder Musk had not yet produced a single car currently marketed by the company.
The automaker had only produced the limited edition Roadster sports car. The horizon was bleak for the entire American car. Detroit’s Big Three were desperate. Chrysler and GM went bankrupt that year. Ford was the only one not to file for bankruptcy.
For the upstart Tesla was at the time, there was nothing for it but to drop the curtain because everything was against the company. The climate was not favorable for electric vehicles. Hit by the crisis, consumers were only thinking about one thing: to save while investors fled all risky assets.
But a savior came: Daimler, the parent company of Mercedes-Benz. Musk just revealed this during a thread on Twitter.
“I wonder what would have happened in 2009 if the Fed had raised rates instead of lowering them,” the billionaire wrote on Twitter on Jan. 13. “The higher the interest rate, the harder the fall.”
Daimler ‘saved Tesla’
“Lucky Tesla then found an investor,” said one Twitter user.
“It’s true, Daimler’s investment in 2009 is actually what saved Tesla,” Musk replied.
On May 18, 2009, Tesla and Daimler (DMLRY) announced a strategic partnership, including the acquisition of a stake in the US company by the German automaker.
Mercedes-Benz’s parent company acquired nearly 10 percent of Tesla and the two automakers agreed to collaborate on battery systems, electric drive systems and individual vehicle projects, a press release said.
“Our strategic partnership is an important step in accelerating the commercialization of electric powertrains worldwide,” said Dr. Thomas Weber, Member of the Board of Management of Daimler AG, responsible for Group Research and Mercedes-Benz Cars Development.
“It is an honor and a powerful endorsement of our technology that Daimler would choose to invest in and partner with Tesla,” Musk said. “We look forward to strategically working together in a number of areas, including leveraging Daimler’s expertise in engineering, manufacturing and supply chain. This will accelerate production of our Tesla Model S and ensure that it is an superlative vehicle.”
This alliance confirmed Musk’s vision and Tesla’s strategy. Daimler recognized that the future of the automobile lay in electric vehicles and that the key to success was getting it to market quickly. Since Tesla was already proficient, joining forces with Musk’s group would dramatically reduce the research and development time required for Daimler’s first 100% electric cars to go into production.
Financial terms of the deal have not been disclosed, but numerous articles have reported $50 million. Daimler sold its stake in Tesla in 2014 for a huge profit.
“Ironically, the company that made the first commercially viable internal combustion engine car saved the company that made the first commercially viable electric car!” Musk decided on January 13.