Toyota is teaming up with Tesla Motors to develop and build electric cars at a recently shuttered auto plant in the San Francisco Bay area. Toyota CEO Akio Toyoda said yesterday the world's largest automaker will invest $50 million in Tesla when the company goes public, and Tesla CEO Elon Musk said his company will purchase the factory in Fremont where the Model S electric sedan will be built.
Analysts said the partnership enhances the credibility of Tesla, a Silicon Valley startup just a few years ago, and boosts Toyota's image, tarnished by recalls. Tesla, which currently makes a two-seater electric sports car costing $109,000, said its goal is to produce increasingly affordable electric cars. The Model S is slated to go on sale in 2012 for $49,900, including federal tax credits, and is designed to travel as far as 300 miles on a three- to five-hour charge.