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Tesla Motors Preparing for Some $60 Million Profit from the Alliance With Toyota


Tesla Motors is responsible for many innovations from the electric cars field lately. Their recent contract with Toyota, having as objective the production of a new version of the electric RAV4 is said to bring the Silicon Valley firm some $60 million.

Tesla only has to produce the functional part of the car, that is the batteries, motor, gearbox and electric control system, and Toyota will do the rest. Tesla has even acquired a former Toyota&GM-owned production plant in Fremont, CA.

The company led by Elon Musk, the creator of PayPal, lost a lot of cash (around $102 million) during the first three quarters, only having their flagship Tesla Roadster for sale, which brought them an insufficient $68 million.

The Model S, though, is said to bring them some more reputation among the producers of electric cars, because the electric sedan will feature some 300 miles autonomy, given the competitors’ models only reach 160 miles at best. The car already has around 3,000 reservations of $5,000 each, so some $15 mln are already in their hands for development use.

My personal guess is Toyota will also benefit for the extended range of the batteries due to their contract and close relationship based on the RAV4. Maybe that’s the reason why the Japanese manufacturer wasn’t in such a hurry of releasing a full-electric model like Nissan.

Of course, the better battery technology exists and I am pretty sure the other companies are also aware of its existence, but it will only get out when the market requests it. Tesla has been the pioneer in commercializing true electric cars, now why shouldn’t they be the first to commercialize truly usable electric cars? I think the Model S, hitting the road in 2012, will also hit the others in their sales if they don’t prepare something at least as nice at Tesla’s.

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