Toyota was an early investor in Tesla (at USD$50M) purchasing about 3% of Tesla's equity. Toyota bought in May 2010 (pre-IPO), began selling in 2014, and sold 2,300,000 shares (diluted to 1.43% of Tesla) by the end of 2016. Estimated gains were about 10x on the Tesla investment. At the peak an investment in 3% of Tesla was valued at more than USD$30B (600x gain). Toyota also trialed an electric RAV4 model using Tesla technology. The Fremont, CA, Tesla plant came from Toyota’s venture with GM and passed to Tesla during their joint development period.
[https://www.carmagazine.co.uk/car-news/industry-news/tesla/toyota-and-tesla-strike-50m-electric-car-deal/ “‘I sensed the great potential of Tesla’s technology and was impressed by its dedication to monozukuri [Toyota’s approach to manufacturing],’ said Toyota president Akio Toyoda. ‘Through this partnership, by working together with a venture business such as Tesla, Toyota would like to learn from the challenging spirit, quick decision-making, and flexibility that Tesla has. 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.’”]
Next week, there will be a follow-on post to talk about Daimler’s early investment and to dig a little deeper into the implication of Toyota’s early investment.
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