Tesla's New BFF (And Savior?) Is Mercedes-Benz

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2012 Tesla Model S - waiting for our 90-second ride

2012 Tesla Model S - waiting for our 90-second ride

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We're hardly the first site to raise questions about Tesla Motors and the challenges it faces. But now another piece of the puzzle has fallen into place: Daimler AG has purchased "nearly 10 percent" of the Silicon Valley electric-car startup.

That gives Tesla access to the Mercedes-Benz parts bin, which could help it get the promised 2012 Tesla Model S electric sports sedan launched.

The big question that will determine Tesla's future: What did Daimler pay for its stake? Unlike previous Tesla funding events, no dollar figures were given for the new funding. The only comment was that the stake was for "double digit millions".

That could mean anything from $10 million--which would be dire straits indeed--to $99 million, in which case the nascent car company would be valued at $1 billion.

Industry analysts say to launch a higher-volume sedan requires at least a few hundred million dollars. Tesla's finances are fairly opaque, but one former Tesla insider we contacted fears that the lack of a stated valuation means the number was on the low side. Only time will tell.

Batteries going both ways

Daimler and Tesla are hardly strangers. The two companies announced their first partnership at the 2009 Detroit Auto Show. Tesla agreed to supply batteries for 1,000 electric versions of the Smart ForTwo, to be tested in Germany and Italy.

Observers have long been skeptical that Tesla's complex liquid-cooled battery, which uses thousands of small commodity lithium-ion cells wired together in a dense network of sensors, connectors, and controllers, can be practically scaled up to produce tens of thousands of less expensive sedans a year.

Now it looks like the battery technology may flow in both directions.  Automotive News notes that CEO Elon Musk specifically cited the lithium-ion cell developed by Daimler's joint venture with Evonik, named Deutsche Accumotive GmbH, as being of interest to Tesla.

That cell is packaged in a pouch, rather than the cylindrical packaging of the commodity cells Tesla now uses, which gives additional flexibility in battery design and makes cooling much easier.

What goes up must come down

When Tesla unveiled its all-electric Roadster a couple of years ago, the company drew more media for a time than any other sports-car maker.

And there's no denying that the 2009 Tesla Roadster is hellacious fun to drive, despite questions over its range and degradation of its battery pack over the long term.

But after missed deadlines and executive turmoil, the tide seems to have turned. And inaccurate statements by CEO Elon Musk probably haven't helped. Today, skepticism runs rampant over the company's future, its funding, and its ability to launch the 2012 Tesla Model S four-door sports sedan it previewed in March.

We got a ride in that prototype last month, at a swanky Manhattan event where Tesla took deposits for the Model S and offered rides to select guests. For all of 90 seconds, it was smooth, quiet, fast, and luxurious.

Model S = CLS underneath?

But the prototype may not be quite as final as it appeared. The Daimler partnership will likely let the 2012 Tesla Model S incorporate a lot more Mercedes-Benz in it than the company told us a few weeks ago.

Tesla had offered fairly detailed specs for the new electric sedan at the preview, but executives later noted that the prototype could change considerably  in form and detail before it reached production.

Before the launch, we had asked Tesla about a story first suggested by Autoblog.nl suggesting that the running Model S prototype was built entirely on the understructure of a Mercedes-Benz CLS.

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