Tesla to make electric vehicles with Toyota, buy NUMMI

Tesla to make electric vehicles with Toyota, buy NUMMI
Mark Rechtin
and Lindsay Chappell
Automotive News -- May 20, 2010 - 5:36 pm ET

PALO ALTO, Calif. -- Toyota Motor Corp. and Tesla Motors Inc. will
team to produce electric vehicles at New United Motor Manufacturing
Inc. in Fremont, Calif., a plant that Toyota last year ruled too
inefficient to keep open.

Tesla will acquire the now-closed NUMMI property and employ 1,000
people building unspecified electric vehicles in a partnership with
the world's largest automaker, the companies announced Thursday.

Toyota will invest $50 million in the small California-based electric
sports maker in exchange for Tesla's common stock when the EV company
completes its planned initial public offering.

In addition to the NUMMI purchase, the venture will spur a
product-development relationship between the automakers.

Under the partners' scenarios, Tesla will gain from Toyota's scale,
engineering resources and access to its supplier base. Toyota, in
turn, will have Tesla's lean and rapid product development, as well as
its electric vehicle technology. Toyota is still using older-tech
nickel-metal-hydride batteries in its Prius and other hybrids, while
Tesla is using newer, lithium-ion batteries.

Said Toyota President Akio Toyoda: "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."

Costs

Tesla CEO Elon Musk said his company would spend "a couple of hundred
million dollars" preparing NUMMI for the project.

That cost will be covered by $465 million in Department of Energy
loans that will fund the manufacturing ramp-up, as well as development
of the upcoming Model S sedan.

NUMMI's costs also will be defrayed by about $20 million in sales tax
abatements the state of California is providing Tesla in its capital
expenditures, Musk said.

NUMMI, a former joint venture between Toyota and General Motors,
closed earlier this year amid a storm of criticism from the plant's
UAW work force.

Musk said the negotiations to acquire the closed plant, located across
San Francisco Bay from Tesla's Palo Alto headquarters, concluded
yesterday.

He said that Tesla's next car, a Model S that will debut in 2012, will
account for about 20,000 units a year. Other models will follow off
the platform.

"NUMMI is a massive plant. We're going to be occupying a little
corner," Musk said. He added that he expects the plant to build
"hundreds of thousands" of more affordable electric vehicles in the
longer term.

"That's where NUMMI is great. It's designed for high-volume, efficient
production," Musk said.

He said that eventually the project would account for 10,000 jobs,
including positions with suppliers.

Tesla has said that the Model S will sell for about $40,000. Until it
appears, Tesla is marketing a two-seat electric sports car that
retails for more than $100,000.

Toyota has expressed little interest in electric cars before today.
The Japanese automaker has staked considerable research and marketing
investment on its popular hybrid-drive vehicles, including the Prius
and hybrid Camry.


You can reach Mark Rechtin at .


Read mo
http://www.autonews.com/apps/pbcs.dl...#ixzz0oZ3LrjXq

"C. E. White" > wrote in message
...
> Tesla to make electric vehicles with Toyota, buy NUMMI


Mark MUST be joking...

Another Mark (Weiss) is a stock market guru who has called a number
of the big movement in the market.. Last night, he was cautioning investor
to go to cash.. Claims another crash of hobbling proportions is in the
wind.

The way I see this, the US Goverment is giving Tesla half a billion
dollars and Tesla is forking some of this money over to Toyota. For
this Tesla is getting the old NUMMI Plant and Toyota gets to claim
they are investing 50 million in Tesla. My real question is - which
way is the cash flowing? Is Toyota giving Tesla 50 million in cash, or
is it really the other way - Tesla giving Toyota some cash for the
NUMMI Plant, and that Toyota is claiming that the net difference
between what they wish they could get for the old NUMMI Plant and what
Tesla actual pays for it is equal to a 50 million dollar investment
in Tesla? I suppose if Tesla is successful, Toyota will end up owning
the company

After reading about the sort of dishonest crap that goes on in the
world of big finance, I trust nothing I read about "investments." I
have a real fear that this really represents a sneaky way of shifting
additional millions of US Government dollars to Toyota. Hopefully I am
wrong. But then the cash for clunkers and the rebate for hybrids
programs were previous gifts of billions to Toyota. And people whine
about GM....at least GM pretends to be a US company.

Ed

"C. E. White" > wrote in message
...
> Tesla to make electric vehicles with Toyota, buy NUMMI
> Mark Rechtin
> and Lindsay Chappell
> Automotive News -- May 20, 2010 - 5:36 pm ET
>
> PALO ALTO, Calif. -- Toyota Motor Corp. and Tesla Motors Inc. will
> team to produce electric vehicles at New United Motor Manufacturing
> Inc. in Fremont, Calif., a plant that Toyota last year ruled too
> inefficient to keep open.
>
> Tesla will acquire the now-closed NUMMI property and employ 1,000
> people building unspecified electric vehicles in a partnership with
> the world's largest automaker, the companies announced Thursday.
>
> Toyota will invest $50 million in the small California-based
> electric sports maker in exchange for Tesla's common stock when the
> EV company completes its planned initial public offering.
>
> In addition to the NUMMI purchase, the venture will spur a
> product-development relationship between the automakers.
>
> Under the partners' scenarios, Tesla will gain from Toyota's scale,
> engineering resources and access to its supplier base. Toyota, in
> turn, will have Tesla's lean and rapid product development, as well
> as its electric vehicle technology. Toyota is still using older-tech
> nickel-metal-hydride batteries in its Prius and other hybrids, while
> Tesla is using newer, lithium-ion batteries.
>
> Said Toyota President Akio Toyoda: "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."
>
> Costs
>
> Tesla CEO Elon Musk said his company would spend "a couple of
> hundred million dollars" preparing NUMMI for the project.
>
> That cost will be covered by $465 million in Department of Energy
> loans that will fund the manufacturing ramp-up, as well as
> development of the upcoming Model S sedan.
>
> NUMMI's costs also will be defrayed by about $20 million in sales
> tax abatements the state of California is providing Tesla in its
> capital expenditures, Musk said.
>
> NUMMI, a former joint venture between Toyota and General Motors,
> closed earlier this year amid a storm of criticism from the plant's
> UAW work force.
>
> Musk said the negotiations to acquire the closed plant, located
> across San Francisco Bay from Tesla's Palo Alto headquarters,
> concluded yesterday.
>
> He said that Tesla's next car, a Model S that will debut in 2012,
> will account for about 20,000 units a year. Other models will follow
> off the platform.
>
> "NUMMI is a massive plant. We're going to be occupying a little
> corner," Musk said. He added that he expects the plant to build
> "hundreds of thousands" of more affordable electric vehicles in the
> longer term.
>
> "That's where NUMMI is great. It's designed for high-volume,
> efficient production," Musk said.
>
> He said that eventually the project would account for 10,000 jobs,
> including positions with suppliers.
>
> Tesla has said that the Model S will sell for about $40,000. Until
> it appears, Tesla is marketing a two-seat electric sports car that
> retails for more than $100,000.
>
> Toyota has expressed little interest in electric cars before today.
> The Japanese automaker has staked considerable research and
> marketing investment on its popular hybrid-drive vehicles, including
> the Prius and hybrid Camry.
>
>
> You can reach Mark Rechtin at .
>
>
> Read mo
> http://www.autonews.com/apps/pbcs.dl...#ixzz0oZ3LrjXq
>

"C. E. White" > wrote in message
...
> The way I see this, the US Goverment is giving Tesla half a billion
> dollars and Tesla is forking some of this money over to Toyota. For this
> Tesla is getting the old NUMMI Plant and Toyota gets to claim they are
> investing 50 million in Tesla. My real question is - which way is the cash
> flowing? Is Toyota giving Tesla 50 million in cash, or is it really the
> other way - Tesla giving Toyota some cash for the NUMMI Plant, and that
> Toyota is claiming that the net difference between what they wish they
> could get for the old NUMMI Plant and what Tesla actual pays for it is
> equal to a 50 million dollar investment in Tesla? I suppose if Tesla is
> successful, Toyota will end up owning the company
>
> After reading about the sort of dishonest crap that goes on in the world
> of big finance, I trust nothing I read about "investments." I have a real
> fear that this really represents a sneaky way of shifting additional
> millions of US Government dollars to Toyota. Hopefully I am wrong. But
> then the cash for clunkers and the rebate for hybrids programs were
> previous gifts of billions to Toyota. And people whine about GM....at
> least GM pretends to be a US company.
>
> Ed

Well, you and I are exactly on the same page about this "investments"
crap.

I am highly suspect of the GM plant to make CNG and LPG vans,
for the same reason. I, now old and cynical, smell a skunk.

Tesla, at least, had some fairly advanced technology and models
which were exciting and almost practical.

I am always waiting for the next BOHICA whenever our government
gets involved.

C. E. White wrote:
> The way I see this, the US Goverment is giving Tesla half a billion
> dollars and Tesla is forking some of this money over to Toyota. For
> this Tesla is getting the old NUMMI Plant and Toyota gets to claim
> they are investing 50 million in Tesla.

The NUMMI plant may be old, but the equipment is modern.

Gee, let's see: NUMMI is in Silicon Valley which has a bunch of
well-motivated workers who understand technology and cars. They are also
motivated to help the environment (this is CA, after all). Gee, sounds
like using the plant is a good idea.

> My real question is - which
> way is the cash flowing?

Toyota is investing $50,000,000 in Telsa. So that's where the money is
going: Toyota --> Tesla. Tesla is going to buy the plant for an
undisclosed sum.

> Is Toyota giving Tesla 50 million in cash, or
> is it really the other way - Tesla giving Toyota some cash for the
> NUMMI Plant, and that Toyota is claiming that the net difference
> between what they wish they could get for the old NUMMI Plant and what
> Tesla actual pays for it is equal to a 50 million dollar investment
> in Tesla? I suppose if Tesla is successful, Toyota will end up owning
> the company

Toyota is investing in Tesla, which means Tesla will be part owned by
Toyota.

> After reading about the sort of dishonest crap that goes on in the
> world of big finance, I trust nothing I read about "investments."

Gee, they don't provide details like what percent of the company will own.

> I
> have a real fear that this really represents a sneaky way of shifting
> additional millions of US Government dollars to Toyota. Hopefully I am
> wrong. But then the cash for clunkers and the rebate for hybrids
> programs were previous gifts of billions to Toyota. And people whine
> about GM....at least GM pretends to be a US company.

Billions? Actually, they were our gifts to car buyers.

> Ed
>
> "C. E. White" > wrote in message
> ...
>> Tesla to make electric vehicles with Toyota, buy NUMMI
>> Mark Rechtin
>> and Lindsay Chappell
>> Automotive News -- May 20, 2010 - 5:36 pm ET
>>
>> PALO ALTO, Calif. -- Toyota Motor Corp. and Tesla Motors Inc. will
>> team to produce electric vehicles at New United Motor Manufacturing
>> Inc. in Fremont, Calif., a plant that Toyota last year ruled too
>> inefficient to keep open.
>>
>> Tesla will acquire the now-closed NUMMI property and employ 1,000
>> people building unspecified electric vehicles in a partnership with
>> the world's largest automaker, the companies announced Thursday.
>>
>> Toyota will invest $50 million in the small California-based
>> electric sports maker in exchange for Tesla's common stock when the
>> EV company completes its planned initial public offering.
>>
>> In addition to the NUMMI purchase, the venture will spur a
>> product-development relationship between the automakers.
>>
>> Under the partners' scenarios, Tesla will gain from Toyota's scale,
>> engineering resources and access to its supplier base. Toyota, in
>> turn, will have Tesla's lean and rapid product development, as well
>> as its electric vehicle technology. Toyota is still using older-tech
>> nickel-metal-hydride batteries in its Prius and other hybrids, while
>> Tesla is using newer, lithium-ion batteries.
>>
>> Said Toyota President Akio Toyoda: "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."
>>
>> Costs
>>
>> Tesla CEO Elon Musk said his company would spend "a couple of
>> hundred million dollars" preparing NUMMI for the project.
>>
>> That cost will be covered by $465 million in Department of Energy
>> loans that will fund the manufacturing ramp-up, as well as
>> development of the upcoming Model S sedan.
>>
>> NUMMI's costs also will be defrayed by about $20 million in sales
>> tax abatements the state of California is providing Tesla in its
>> capital expenditures, Musk said.
>>
>> NUMMI, a former joint venture between Toyota and General Motors,
>> closed earlier this year amid a storm of criticism from the plant's
>> UAW work force.
>>
>> Musk said the negotiations to acquire the closed plant, located
>> across San Francisco Bay from Tesla's Palo Alto headquarters,
>> concluded yesterday.
>>
>> He said that Tesla's next car, a Model S that will debut in 2012,
>> will account for about 20,000 units a year. Other models will follow
>> off the platform.
>>
>> "NUMMI is a massive plant. We're going to be occupying a little
>> corner," Musk said. He added that he expects the plant to build
>> "hundreds of thousands" of more affordable electric vehicles in the
>> longer term.
>>
>> "That's where NUMMI is great. It's designed for high-volume,
>> efficient production," Musk said.
>>
>> He said that eventually the project would account for 10,000 jobs,
>> including positions with suppliers.
>>
>> Tesla has said that the Model S will sell for about $40,000. Until
>> it appears, Tesla is marketing a two-seat electric sports car that
>> retails for more than $100,000.
>>
>> Toyota has expressed little interest in electric cars before today.
>> The Japanese automaker has staked considerable research and
>> marketing investment on its popular hybrid-drive vehicles, including
>> the Prius and hybrid Camry.
>>
>>
>> You can reach Mark Rechtin at .
>>
>>
>> Read mo
>> http://www.autonews.com/apps/pbcs.dl...#ixzz0oZ3LrjXq
>>
>
>

On Fri, 21 May 2010 07:58:47 -0400, C. E. White wrote:

>
> Under the partners' scenarios, Tesla will gain from Toyota's scale,
> engineering resources and access to its supplier base. Toyota, in turn,
> will have Tesla's lean and rapid product development, as well as its
> electric vehicle technology. Toyota is still using older-tech
> nickel-metal-hydride batteries in its Prius and other hybrids, while Tesla
> is using newer, lithium-ion batteries.

IIRC, you are an engineer?

Li-IO batteries are tempermental. They were responsible for the laptop
blowups 4 years ago. If they are allowed to go over voltage or
undervoltage they can get intoa 'runaway' state and FFFFFFFFFT!

I use Li Io batteries in my electronic ciggies. THe thought of having
something like that close to my face is a little unnerving. Indeed, one
experimenter (who, against better judgement didn't use Protected batteries
in his home-made power source) suffered 2nd & 3rd degree burns when his
experimental e-cig went FFFFFFFT in his pocket.

Is it worse than Gasoline? Maybe not. More modern devices like cell
phones, etc are using newer Li-Po (Lithium-Polymer) batteries that are a
bit more even tempered when pushed to their limits. The state of the art
right now is that although they are about the same price as Li-Io
batteries, the charge doesn't last quite as long, so more recharging is
required.

But, that should be solved within the next 5 years, or an even better
power source will probably be on line.

"Hachiroku ãƒ�ãƒ�ãƒ*ク" > wrote in message
news
> On Fri, 21 May 2010 07:58:47 -0400, C. E. White wrote:
>
>>
>> Under the partners' scenarios, Tesla will gain from Toyota's scale,
>> engineering resources and access to its supplier base. Toyota, in turn,
>> will have Tesla's lean and rapid product development, as well as its
>> electric vehicle technology. Toyota is still using older-tech
>> nickel-metal-hydride batteries in its Prius and other hybrids, while
>> Tesla
>> is using newer, lithium-ion batteries.
>
> IIRC, you are an engineer?

Moi? The quote is from the Autonews article. I make no claims of special
knowledge of batteries.

Ed

>
> Li-IO batteries are tempermental. They were responsible for the laptop
> blowups 4 years ago. If they are allowed to go over voltage or
> undervoltage they can get intoa 'runaway' state and FFFFFFFFFT!
>
> I use Li Io batteries in my electronic ciggies. THe thought of having
> something like that close to my face is a little unnerving. Indeed, one
> experimenter (who, against better judgement didn't use Protected batteries
> in his home-made power source) suffered 2nd & 3rd degree burns when his
> experimental e-cig went FFFFFFFT in his pocket.
>
> Is it worse than Gasoline? Maybe not. More modern devices like cell
> phones, etc are using newer Li-Po (Lithium-Polymer) batteries that are a
> bit more even tempered when pushed to their limits. The state of the art
> right now is that although they are about the same price as Li-Io
> batteries, the charge doesn't last quite as long, so more recharging is
> required.
>
> But, that should be solved within the next 5 years, or an even better
> power source will probably be on line.
>
>
>

----- Original Message -----
From: "dr_jeff" >
Newsgroups: alt.autos.toyota,rec.autos.misc,rec.autos.tech
Sent: Friday, May 21, 2010 6:10 PM
Subject: Tesla to make electric vehicles with Toyota, buy NUMMI


> C. E. White wrote:
>> The way I see this, the US Government is giving Tesla half a billion
>> dollars and Tesla is forking some of this money over to Toyota. For this
>> Tesla is getting the old NUMMI Plant and Toyota gets to claim they are
>> investing 50 million in Tesla.
>
> The NUMMI plant may be old, but the equipment is modern.
>
> Gee, let's see: NUMMI is in Silicon Valley which has a bunch of
> well-motivated workers who understand technology and cars. They are also
> motivated to help the environment (this is CA, after all). Gee, sounds
> like using the plant is a good idea.

I am not disputing that. But if using this plant was so great, why did
Toyota abandon it? Where they just trying to lose the UAW?

>> My real question is - which way is the cash flowing?
>
> Toyota is investing $50,000,000 in Tulsa. So that's where the money is
> going: Toyota --> Tesla. Tesla is going to buy the plant for an
> undisclosed sum.

I hope you are right, but I am skeptical. I think it far more likely that
Tulsa is paying Toyota a bundle for the plant using the US Government money
and that the 50 million dollar Toyota "investment" is effectively a mark
down in the cost of the plant. Maybe not. But I think Tulsa likes the deal
because they gain instant credibility (and it solidifies their hold on a
half of billion dollars of US Government cash). Toyota likes the deal
because they gain some good publicity, they gain access to Tulsa technology
(although I wonder how valuable that technology really is), and if Tulsa is
eventually successful, they own a piece of the pie.

Personally I doubt Tulsa can be successful unless a major automaker, like
Toyota, gets involved. So for Tulsa, this is probably a make or break deal.

I do find it ironic that people rant and rave about the billions the US
Government has sunk into GM which is now effectively owned by the US and
Canadian governments, while no one seems at all upset that the US Government
is granting Tulsa a half a billion dollars free and clear. On the basis of
dollars per US job, or dollars per car, or the potential impact on the US
economy, the money spent on GM looks like a bargain if you use the Tulsa
give away as a yardstick. And now that Toyota is swooping in, the half a
billion dollars given to Tulsa has a good chance of being essentially R&D
money given to Toyota.

>> Is Toyota giving Tesla 50 million in cash, or is it really the other
>> way - Tesla giving Toyota some cash for the NUMMI Plant, and that Toyota
>> is claiming that the net difference between what they wish they could get
>> for the old NUMMI Plant and what Tesla actual pays for it is equal to a
>> 50 million dollar investment in Tesla? I suppose if Tesla is successful,
>> Toyota will end up owning the company
>
> Toyota is investing in Tesla, which means Tesla will be part owned by
> Toyota.
>
>> After reading about the sort of dishonest crap that goes on in the world
>> of big finance, I trust nothing I read about "investments."
>
> Gee, they don't provide details like what percent of the company will own.


Correct. And we don't know if they have options to buy more of Tulsa at some
predetermined price. I think Tulsa needs the deal to have any chance of
"making it." I worry Toyota is taking advantage of a desperate company to
unload a plant they don't want and gain access to some potentially valuable
technology mostly at the expense of the US taxpayer. I hope I am wrong.

Ed

Bitten by the spell checker - Tesla, NOT Tulsa.

Ed
"C. E. White" > wrote in message
m...
> ----- Original Message -----
> From: "dr_jeff" >
> Newsgroups: alt.autos.toyota,rec.autos.misc,rec.autos.tech
> Sent: Friday, May 21, 2010 6:10 PM
> Subject: Tesla to make electric vehicles with Toyota, buy NUMMI
>
>
>> C. E. White wrote:
>>> The way I see this, the US Government is giving Tesla half a billion
>>> dollars and Tesla is forking some of this money over to Toyota. For this
>>> Tesla is getting the old NUMMI Plant and Toyota gets to claim they are
>>> investing 50 million in Tesla.
>>
>> The NUMMI plant may be old, but the equipment is modern.
>>
>> Gee, let's see: NUMMI is in Silicon Valley which has a bunch of
>> well-motivated workers who understand technology and cars. They are also
>> motivated to help the environment (this is CA, after all). Gee, sounds
>> like using the plant is a good idea.
>
> I am not disputing that. But if using this plant was so great, why did
> Toyota abandon it? Where they just trying to lose the UAW?
>
>>> My real question is - which way is the cash flowing?
>>
>> Toyota is investing $50,000,000 in Tulsa. So that's where the money is
>> going: Toyota --> Tesla. Tesla is going to buy the plant for an
>> undisclosed sum.
>
> I hope you are right, but I am skeptical. I think it far more likely that
> Tulsa is paying Toyota a bundle for the plant using the US Government
> money and that the 50 million dollar Toyota "investment" is effectively a
> mark down in the cost of the plant. Maybe not. But I think Tulsa likes the
> deal because they gain instant credibility (and it solidifies their hold
> on a half of billion dollars of US Government cash). Toyota likes the deal
> because they gain some good publicity, they gain access to Tulsa
> technology (although I wonder how valuable that technology really is), and
> if Tulsa is eventually successful, they own a piece of the pie.
>
> Personally I doubt Tulsa can be successful unless a major automaker, like
> Toyota, gets involved. So for Tulsa, this is probably a make or break
> deal.
>
> I do find it ironic that people rant and rave about the billions the US
> Government has sunk into GM which is now effectively owned by the US and
> Canadian governments, while no one seems at all upset that the US
> Government is granting Tulsa a half a billion dollars free and clear. On
> the basis of dollars per US job, or dollars per car, or the potential
> impact on the US economy, the money spent on GM looks like a bargain if
> you use the Tulsa give away as a yardstick. And now that Toyota is
> swooping in, the half a billion dollars given to Tulsa has a good chance
> of being essentially R&D money given to Toyota.
>
>>> Is Toyota giving Tesla 50 million in cash, or is it really the other
>>> way - Tesla giving Toyota some cash for the NUMMI Plant, and that Toyota
>>> is claiming that the net difference between what they wish they could
>>> get for the old NUMMI Plant and what Tesla actual pays for it is equal
>>> to a 50 million dollar investment in Tesla? I suppose if Tesla is
>>> successful, Toyota will end up owning the company
>>
>> Toyota is investing in Tesla, which means Tesla will be part owned by
>> Toyota.
>>
>>> After reading about the sort of dishonest crap that goes on in the world
>>> of big finance, I trust nothing I read about "investments."
>>
>> Gee, they don't provide details like what percent of the company will
>> own.
>
>
> Correct. And we don't know if they have options to buy more of Tulsa at
> some predetermined price. I think Tulsa needs the deal to have any chance
> of "making it." I worry Toyota is taking advantage of a desperate company
> to unload a plant they don't want and gain access to some potentially
> valuable technology mostly at the expense of the US taxpayer. I hope I am
> wrong.
>
> Ed

"C. E. White" > wrote in message
> I am not disputing that. But if using this plant was so great, why did
> Toyota abandon it? Where they just trying to lose the UAW?


I dont think there was ever any secret about this.. This California
plant was the most expensive to operate in this hemisphere. When
GM ducked out, the reason for it to even exist disappeared. It
was cheaper to shut this dynosaur down than to try to operate it.

Toyota is not dumb.

At least, that is the story as I remember it.