Tesla has grown into the most valuable automaker in the world in recent years. With bold innovations and boldness, billionaire Elon Musk’s company outperformed traditional competitors in market value, in part with the help of competing companies Toyota and Daimler.
Mercedes parent company Daimler had an early thought that Tesla, which only makes electric cars, could become big. In 2009, the Germans invested 50 million euros in Musk’s company, acquiring almost 10 percent of the shares. The CEO has repeatedly stated in recent years that Tesla would not have made it without that help from Daimler.
The move gave Daimler an insight into how the Tesla CEO worked: he was willing to market technology that was not perfect, then improve it by continuously sending digital updates. It did not matter that this initially yielded little profit.
German approach collided with that of Tesla
After acquiring the stake, the Germans helped Tesla bring the Model S to the market. In return, Daimler gained access to the technology that Tesla incorporates into the vehicles. The battery technology was reflected in the pre-production copies of the Smart Electric Drive, the electric drive expertise in the Mercedes-Benz B-class Electric Drive.
Nevertheless, the German car manufacturer decided in 2014 to sell the interest in Tesla. There was too much doubt as to whether the American company’s way of working could ever be widely practiced. Had Daimler held his shares, they would now have been worth $ 7.4 billion (about $ 6.3 billion), according to figures Bloomberg earlier this month.
Insiders from Daimler who were involved in the collaboration with Tesla at the time saw that the Germans ‘traditional approach clashed with the Americans’ progressive way of working, which focused on radical ideas and rapid innovation.
Toyota came to the same conclusion
Toyota also started a partnership with Tesla in 2010 to develop a new model. The Japanese were impressed by the speed with which Tesla developed the new model. However, they quickly came to the same conclusion as Daimler: the Americans’ method of working would not be suitable for mass production because it could not meet Toyota’s safety and longevity requirements.
Despite this, Musk decided to continue with his way of working, although big gains still failed to materialize. The tide seems to have turned since then. Partly due to the diesel scandal, the popularity of electric driving increased, from which Tesla benefited. Sales figures have increased dramatically in recent years and investors have become increasingly enthusiastic. They now rate Tesla higher than Daimler.
Big bonus for Musk
Tesla is currently worth around $ 300 billion, while Daimler is worth less than $ 50 billion on the stock exchange. Because Tesla’s stock market value was above $ 150 billion for six months, Musk will receive a whopping $ 2.1 billion bonus in the form of options, which he will only be able to redeem in five years.
It is also striking that the sales figures of, for example, Daimler are many times higher than those of Tesla. For example, Mercedes-Benz, which is responsible for approximately 50 percent of Daimler’s turnover, sold well in 2019 2.3 million cars. Tesla supplied approximately 367,500 off. Many, if not all, major car manufacturers have now developed electric cars to catch up with Tesla in the coming years.