Tesla CEO, Elon Musk, has said that he would “certainly have that conversation” if another automaker suggested a Tesla merger. This was in answer to a question posed in an interview by Mathias Doepfner, CEO of German media and tech firm, Axel Springer SE, after Musk won the Axel Springer award given to “outstanding personalities who are particularly innovative, and who generate and change markets, influence culture and at the same time face up to their responsibility to society”.
Doepfner asked a theoretical question about a Tesla merger with one of the more traditional large-scale car companies. “I think we’re definitely not going to launch a hostile takeover,” Musk replied.
Asked if a friendly takeover was more likely, Musk answered, “If somebody said, ‘hey, we think it would be a good idea to merge with Tesla,’ we’d certainly have that conversation. But we don’t want it to be a hostile takeover situation.”
Tesla currently has the highest market cap of all automakers at $548 billion, with Toyota second at $190 billion and General Motors sixth at $64 billion.
No specific merger has been suggested by Musk, but GM Authority‘s view is that such an arrangement would not work with The General. In addition to developing and building its own Ultium batteries and Ultium Drive systems, GM has an alliance agreement with Honda to produce vehicles, both ICE and electric, and is also in partnership with startup Nikola, though this has recently been scaled back.
Furthermore, GM has announced that it intends to have no less than 30 EVs on sale around the world by 2025, with no input from Tesla. These upcoming models include the Cadillac Lyriq and GMC Hummer EV, along with a host of other models from all its brands, including Chevrolet and Buick.
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Comments
GM has chosen their path.
A Tesla merger is slippery. While another auto maker may want to bolster their lack of a EV program with Tesla most would not Elon to be a part of it. The merged company would only want one master and I don’t see Elon taking a back seat.
The question is what would investors think or do? The cash could evaporate fast if they make a move investors do not approve of.
I always envisioned Tesla as being better if they were just a tech company and develop tech for automakers who can’t afford to do a EV program themselves.
They could design and sell the tech to a number of MFGs and let them build the cars and just take a percentage for each car built. Kind of like Intel does for computers.
How about FCA? They’re relatively small, the Jeep brand still carries a lot of value and there’s not much going on with EVs. Bring Chrysler back to the US.
Not sure what FCA could offer Tesla. Still Jeep, and don’t forget Ram, are valuable. But not sure what either company would do with the other.
For all of Elon’s bluster and cocky- ness, I think he’s just a little nervous about all the competition coming soon. Sooner or later Tesla will need to redesign and replace it’s current products. That’s a VERY expensive excercise. The Model S is over 8 years old now.
FCA already is merging with PSA and they have their own program started for electric.
Ford has mfg and is in great need for electric tech. But the Ford family has no use for Elon as they will not want him in control of their company in any way, that is their strength. But they need stock money.
Ford is a partner with Volkswagen and has no need for Tesla at all.
Only on a model of delivery van. They are not open to the entire VW offerings.
Ford still needs help.
No, they are doing much better in EVs than GM.
FCA/PSA are expected to close next year. Not too late to come in with a better offer.
FCA will get good EV technology from PSA. Chrysler is coming back with rebadged Opel. Stellantis will, like GM, find the cost cutting/increases European factory utilization irresistible. Mokka is a nice looking vehicle.
Tesla-Ford makes the most sense. Aside from trucks it’s Detroit’s weakest by stock price & been in transition mode way too long.
What about my last post needs “Moderation”?
That’s just what the system flagged up. As you’ll see, it’s been approved now.
Elon said it to spark conversation like he always does. They don’t need a merger financially, technically, sales-marketing-markets-distribution.
They are struggling in the MFG end. They are a tech company not a mfg and that has been an issue.
Join an automaker who could mfg their cars for them and it would be a big boost.
Tesla is like Apple. But Apple leaves the MFG to others for them.
So here’s the rub, why on earth would Tesla want to hitch their wagon and be even “Remotely” associated with any of What America calls “The Big three?” These car companies have been a long standing joke of how not to build cars. Americans for the most part avoid spending any of their hard earned money ( When they can) on a Ford, GM or FCA vehicle. I think Tesla needs to stay quite independent of any other car builders. Let Tesla just do what they do. People will continue to trust them. The minute you put Tesla and Ford, GM or God forbid FCA in the same basket. American consumers will simply “Walk Away”
True, Tesla should merge with a company that builds high quality very reliable vehicles. Like Buick
Given that electric vehicles have far fewer moving parts than ICE models, if just 1 Buick goes electric the company would blow away Lexus & Toyota in reliability.
@Peter G:
Hummer is NOT an automaker. It’s a brand name. A brand of General Motors. And has been said, GM doesn’t really need Tesla as far as proprietary technology is concerned. Tesla actually needs GM (or some OEM) to help them in manufacturing.
Megeebee
I disagree. Facts online are like Trump’s tweets or Tesla’s stock price. Absolutely nothing to do with reality.
Hummer would also be a good merger partner for Tesla. A true go anywhere vehicle. Add a way to recharge with solar power, and a mini-fridge that could run off the Hummers batteries. Now you have the ultimate vaccine delivery system.
Except your whole comment falls apart when you realize the big three do sell the most vehicles in the US, those 3 were in the top 4 last year.
Wait! Tell that to China and Brazil who can’t get enough GM cars. The big 3 still hold 50 percent US share, albeit largely due to trucks, but, nonetheless, you must be older repeating a 1980s reality. US cars are on par with European regarding quality and even the Japanese have learned to cut corners and build some clunkers
GM and PSA (Stellantis) both have advanced EV technology. The new Hummer will demonstrate GM can do anything Tesla can. Tesla has the new kid on the block/Elon Musk mojo but expect the German brands to catch up quickly and for FCA to grow far more competitive.
I think Tesla should merge with Texas
We all should 🙂
Tesla should merge with Nikola. 🙂
Spoiler alert Nikola is not making cars anymore (I mean planning..) only Semi.. Only concept is keeping Nikola alive.
The problem is this. Tesla really has owned the market as they are the only true EV automaker. Yes others offer a model here or there but they are not a major marketer of vehicles.
Now as we move forward automakers like GM and VW will be offering very competitive models and in just a couple years introduce more models than Tesla ever offered in their entire time in business.
Yes Tesla has money but they lack scale and ability to bring a number of models at once to market. This begins to be a whole different game at this point.
It is easy to be a big fish in a little pond. But now that pond is getting bigger with even larger fish. So EV sales will be more competitive.
Even with the money Tesla has they have been late on nearly every model they offered. They could afford this if you owned the segment but with companies coming in with force and ability to do cars on time in greater numbers they could use some help.
Tesla also needs to build plants. Germany is started tbe TX plant is in the works but they need more and that takes money. Now automakers out there could partner to share their plants to speed up the ability to make more vehicles.
Also just don’t assume that they could partner with a Big 3. They could partner with BMW, Hyundai or even a brand in China. The door is open to what could happen.
Also this could just be more Musk crazy talk too. It could amount to nothing.
Does anyone listen to Elon? He recently told employees to conserve cash, or else. He’s shouting “if the ICE DINOS stop buying our green credits it will be revealed that we can’t make a profit selling cars.” Reducing pencils and toilet paper consumption might allow them to eke out at small profit. Last quarter, I think they were red without the credits sales. Market Cap is nothing compared to what can you do right now. Does a house of cards explain it?
He was asked a question and answered it pretty vaguely. I mean what else was he going to say.
What does any Legacy Auto Maker have to offer to Tesla?
Their Market Cap is bigger than the entire Automotive sector in the United States per Autoline
a year ago, the question would’ve been what auto manufacturer would buy tesla. now it is the reverse. that is how much things have changed.
I think the only people that were saying such a thing last year were the ones that couldn’t understand what Tesla was all about and what they were working on.
I have been saying that Tesla will blow up and every other Automaker should start moving to EV’s sooner rather than later. Everyone laughed at me when I said the Cybertruck will sell in droves and guess what, they had to build a new Gigafactory for it in Austin, TX
Most CEO’s cannot outsmart someone that literally figured out how to change the way we send money, launch and land Rockets, and make Fast AF EV’s that people drool over and wait weeks if not months to get their cars. Oh and is doing underground Tunnels, open sourced his Hyperloop idea that dozens of Companies are working on and in my opinion will mostly be remembered for his Nueralink Project if it works.
Now everyone is chasing Tesla and who knows if they will be able to catch them. This is why I already gave Tesla the Apple Spot in the Marketplace years ago and I have been saying it is a race for the Google spot between VW and GM and I pray as a GM fan they succeed. I like what I am hearing lately.
But the one thing that Legacy Auto Makers are missing is DC Fast Chargers. I honestly think that since GM and VW have taken the early lead they should team up on that front. VW is spending Billions because they have too due to the Diesel Gate scandal but GM would be smart to help them offset the costs while gaining a growing Network of Chargers for their Customers.
Tesla may have money but they have much to do and that money will only go so far. There are few MFGs they could buy and they need facilities for production and money for product.
They let the S wither when they should be updating. It was their best income model.
I do not think Tesla would want a single Legacy Auto Factory. Have you seen the World Class Factories they are building right now?
What would Tesla do with Old School ICE Factories?
Tesla has pretty much admitted they most likely will build another Factory in another city in China in the Future and another Factory in the USA. I would bet it will be in Nashville, TN
Elon admitted they chose Austin, TX because it was a Hip City and only place some key people would move to besides San Fran.
And way down the road I can see one in India. Maybe a second one in Europe too.
Once Tesla releases their 25K Car around the World they will not be able to build them fast enough.
I keep saying GM should beat them and Price the current Bolt at 25K to get some bragging rights for 2 to 3 years.
Has anyone visited Freshmist UK Ltd? 🙂
No other company will want to buy Tesla, merge with Tesla, or be taken over by Elon Musk.
Tesla will stay as a hermetically closed ecosystem, maintained by the same type of cult as Apple.
But BEVs and later FCEVs made by other automobile makers will overtake Tesla sales, because they will provide a wider variation of products, and give more freedom to their customers.