Toyota and Tesla Motors signed a big-dollar battery contract in 2011, but earlier this year the two companies announced plans to part ways once the current deal ran its course. Toyota is currently focusing its efforts on hydrogen vehicles, while Tesla remains committed to a pure electric vision.
But that doesn’t mean the two companies won’t reconvene. Reuters reports that Elon Musk says Toyota and Tesla could sign a new battery deal in 2 or 3 years time. And this time around, the deal could be much, much bigger.
Toyota sold the NUMMI factory to Tesla for a sweetheart deal and signed a $100 million battery deal that gave the fledgling automaker much-needed capital. Unfortunately the Toyota RAV4 EV has been more a placeholder than a competitive EV, especially compared to the Mercedes B-Class electric, also produced in-part by Tesla. Daimler not only has a battery deal with the electric automaker, but also owns a chunk of its highly-valued stock.
But if hydrogen cars don’t work out for Toyota, they’ll need to buy a lot of batteries in order to launch a new range of EVs. That’s where the Tesla Gigafactory comes in; the battery plant will be able to build a half-million packs annually once it’s fully operational, and not all of those batteries will necessarily be for Tesla vehicles. The initial Toyota-Tesla deal called for just 2,600 vehicles, but by 2020 Toyota and other automakers should be building exponentially more electric vehicles, so a new deal between the two companies would likely be many times larger. Toyota has already said it wants to maintain relations with Tesla, but their focus simply lies elsewhere right now.
For now there are no specific plans between the two companies, leaving the door open for other companies like Nissan and BMW to cozy up to Elon Musk. It seems like everybody but Toyota wants a piece of Tesla these days.