Toyota And Tesla Secretly Holding Talks

Rumor / Comments

Is a new partnership imminent?

Almost 11 years ago, Tesla and Toyota announced a partnership to work together on electric vehicle development. The Japanese automaker also purchased shares of the then-start-up carmaker. It didn't turn out as planned. While Tesla supplied the batteries for the limited production all-electric Toyota RAV4, engineers quickly clashed over battery designs and other issues. By mid-2017, Toyota announced that it has sold all Tesla shares and stopped cooperation. Less than a year ago, Tesla surpassed Toyota as the world's most valuable automaker.

And now South Korean newspaper Chosun Ilbo has published a report claiming the two automakers are talking again. Take this all with a very fine grain of salt because but the pair are supposedly discussing plans to co-manufacture an all-new small SUV electric-vehicle platform.

2020-2021 Tesla Model Y Front View Tesla
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2020-2021 Tesla Model Y Dashboard Tesla

If the report is to be believed, Tesla will supply the electronics and software while Toyota will provide the platform itself. Tesla would thus be able to launch a compact SUV at a low cost using the Toyota architecture and, perhaps more importantly, its Japanese market sales figures would increase significantly. At present, it sells around 1,000 units annually. Neither Tesla nor Toyota has commented on the report.

Toyota would likely benefit from the agreement with not only its own version of the vehicle but also major time and cost reductions normally required for ECU and operating system development. It's still determining whether its own systems can be integrated into Tesla's over-the-air software update system.

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If an agreement is signed, Tesla could increase its Japanese market sales while Toyota would gain a new SUV with advanced software it could potentially sell globally. Would these two vehicles be rivals? Not necessarily. There'd really be no need for Tesla to offer it outside of Japan because it already has the Model Y. In turn, Toyota may not sell it in Japan.

The two EVs could still compete elsewhere but Toyota would probably make its vehicle unique enough with, for example, its own driver-assist systems and styling. But again, this is all merely a rumor for the time being though it's certainly an interesting one.

2012-2014 Toyota RAV4 EV Front View Driving Toyota
2012-2014 Toyota RAV4 EV Rear Angle View Toyota
2012-2014 Toyota RAV4 EV Dashboard Toyota
Source Credits: Chosun Ilbo

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