Daimler Shares Stake in Tesla with Abu Dhabi

By Bill Visnic July 13, 2009

Daimler AG appears to be pulling along its largest single investor for a ride with the company's recent investment into industry-disruptive electric-car maker Tesla Motors Inc. Daimler reportedly is selling a portion of its 10-percent holding in Tesla to Abu Dhabi's Aabar Investments PJSC.

Tesla Model S electric sedan.jpg The deal will give Aabar about 4 percent of Tesla, Bloomberg reports.

Daimler said it will use Tesla-developed lithium-ion battery packs in a trial fleet of 1,000 of Daimler's smart cars converted to run entirely on electricity.

Aabar Chairman Khadem Al Qubaisi said in a statement that the partnership with Daimler in Tesla is part of its "desire to focus on the development of electric vehicles and projects aiming at the reduction of carbon dioxide emissions."

Tesla itself is striving to expand beyond its initial electric model, the high-performance 2-seat Roadster, and last month was announced as the recipient of $465 million in advanced-technology loans from the U.S. Department of Energy. Tesla is now working to tool an assembly plant in southern California to produce a second model, a 4-door sedan called the model S that is scheduled for production in 2011.

A separate Tesla plant in the San Francisco area will produce the battery packs and electric powertrains for both Tesla models and the electric variants of Daimler's smart car.

Photo:

Tesla Model S (courtesy Tesla Motors Inc.)

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