Tesla & Toyota: going steady?

Announced Thursday, the hooking up of Tesla with Toyota took everybody by surprise. As part of the deal, Tesla is buying the giant NUMMI plant in Fremont, CA. This facility has an interesting history as told in this excellent piece from This American Life. Tesla's CEO, Elon Musk, lusted after this plant early in the search for a manufacturing plant for their Model S, but the size of the plant at 5.3 million sq ft was too much for his needs. With Toyota's desire to build a low-cost EV using a Tesla designed drivetrain, all of a sudden, the numbers started to work.

According to GreenBeat, "Again, this is a pretty radical change of pace for Tesla — and it’s apparently come about very quickly. The company had been interested in the NUMMI facility for a while. It met with the plant’s representatives about three months ago with no results. About a month ago, Akio Toyoda, president and CEO of Toyota, approached Musk about a potential strategic partnership, and the two executives hit it off, Musk says".

Also from GreenBeat:

1. The joint development of a brand new,sub- $30,000 electric car, that will contain Tesla’s unique powertrain design, with everything else built by Toyota;
2. The purchase of the NUMMI plant, where Tesla plans to manufacture both its Model S sedan due out in 2012, a new $30,000 Tesla-designed vehicle, and the more affordable jointly designed “third-generation” vehicle;
3. A $50 million investment from Toyota into Tesla when the company goes public, probably later this year.

All in all, this is great news! We'll have more choices in the EV world in a few years. The Volts and Leafs will prime the market for late entries, and if we get a decent energy bill that assigns a price to carbon, then the cost of gas will rise making more and more people make the switch.