Not again! Tesla Again Saved By Daimler (and BMW)

The bad news about Tesla keep coming. We can no longer deny the bad situation of the company. Beside the well-known production problems at Tesla, the long delivery times, the confusion with always new functions that Tesla owners get and that are supposed to distract from all errors (fart app and dog mode, really now?), the massive losses Tesla has been seeing for years, the ridiculous number of way under 400.000 delivered cars (comparison: Daimler and BMW more than 2(!) millions; now that’s what we call production), the delays in the construction of the Gigafactory 3 in Shanghai, which took more than 357 days from groundbreaking to delivery (an eternity in our ever faster moving times), and the blatantly wrong decision to build a Gigafactory 4 in Berlin-Brandenburg, even the hardcore Tesla fanboys are losing faith in the company.

So the news of the rescue plan, which the traditional German manufacturers Daimler and BMW have jointly forged and swiftly implemented through their ridesharing company Free Now, comes just at the right time. Free Now has taken pity on Tesla by buying a few electric cars. 60 Tesla are mercifully added to the Free Now fleet among friends.

The first effects are already visible. Today the Tesla share price jumped several percentage points. Mercedes boss Ola Källenius is quoted as saying that Tesla had already been rescued by Daimler once before. In 2010, Daimler, under the electric vehicle visionary Dieter Zetsche, had bought a ten percent stake in the young Californian start-up for a circulated 50 million dollars. It was not too bad to buy a few electric drive-trains from Tesla and install them in some B-Class models. Years later, Daimler was finally able to sell the shares for a profit, and they were happy about it. The B-Class had caused too much unrest among their own customers, because the Mercedes cheap car had run every AMG tuned Mercedes into the ground.

The motives for BMW’s involvement are different. The traditional Bavarian manufacturer, which is demonstrating its innovative strength with ever larger combustion SUVs, sees its opportunities in a change of business model and production process. BMW boss Harald Krüger explained that BMW is planning to replace its own production, which has actually caused nothing but costs and headaches for decades, with a reselling and upgrading model. “With every over-the-air update at Tesla, they become more valuable because they can do more“, said the head of BMW, “So if we buy Teslas, let some time pass and do all updates well-behaved, we can sell the Teslas for a profit“. Krüger referred to a statement of Tesla-CEO Elon Musk (who is actually responsible for the catastrophic situation of Tesla) who had said that Teslas are the only car that do not depreciate – i.e. they are written off – but increase in value – they appreciate.

BMW CFO Nicolas Peter is currently calculating the increase in profits and the margin from the purchase and sale of Teslas, and rumors have it that the potential profits are astronomical.

Whether electric cars are the future, however, is still open. Free Now, for example, is struggling with the range of its only in-house electric car, the Mercedes EQC. “We wanted to make electric mobility appealing to our customers and include the EQC in our product range“, said Free Now CEO Marc Berg, “but from the charging station on the first floor, where they had been fully charged for the entire week, the vehicles stopped on the way to the garage exit due to an empty battery.” Experts repeatedly pointed out that the high range speeds common in Germany were a factor in the problem. “From 5 to 15 km/h in the garage, and the battery capacity can drop rapidly by 90 percent“, said one electric mobility expert.

“And the BMW i3 is so ugly that we always hide it in the last cellar floor“, explained Berg as he threw up disgustedly in the spittoon.

Whether Tesla will save this rescue package from long-term survival, however, is doubted by many. In Berlin-Brandenburg, the authorities are already preparing for the fact that Gigafactory 4 will never be finished. “I am quite happy that we do not have the overall responsibility for this, but that Tesla is also the architect of his own fortune” and “Tesla must submit the documents so completely and in such high quality that they can be checked as quickly as possible” threatened Economics Minister Jörg Steinbach (SPD) bluntly.

“And if not, then we will find some rare cave worms, threatened bats or an old native American burial ground on the future factory site“, one could still hear at the press conference from a BER-hardened official.

This article has also been published in German.