This is J's Typepad Profile.
Join Typepad and start following J's activity
Join Now!
Already a member? Sign In
J
Recent Activity
Good points both. Assuming it's pretty short money for Daimler, and that in a few years all the major players' plans for electrics bear fruit, the timing and price are great. If not, no big loss.
Regarding the double standard in the treatment of the banks versus the auto companies: it makes "sense" once you learn who Chrysler's biggest creditors are. They are Bank of America, Citicorp, JP Morgan Chase, etc. I don't know what the story is with GM, but I assume it's similar. Obama hasn't earned my trust, either, but it's worth noting that Bush similarly recommended blank checks to the banks. The influence of that industry, even while receiving welfare payments may seem to defy gravity, but it's just how things work at the moment.
So they need Daimler's production experience. I imagine the money helps, too. It's a very interesting move viewed from the other end, though. Perhaps Daimler is leaving the door open to an expansion into the again. That would be surprising since they got badly burned with Chrysler. I have to say the roadster fits nicely with the Mercedes luxury line while the electric Smart might replace the whitestar project, or at least give it more time. They already have a US dealer network, and it's not overly large like GM and Chrysler have. Tesla, a small operation, are very lean and can be easily shaped. All the problems relating to an existing, hulking apparatus-- extra factories, UAW rules and contracts, vast oversaturation of dealerships-- are not an issue with Tesla. But Daimler have the benefit of experience and infrastructure. I'd thought that Tesla might have waited till GM or Chrysler had shut down a bunch more plants, and then poached lots of competent, experienced people and plant space and infrastructure on the cheap, less union entanglement. Perhaps as the above poster notes, Musk was overly confident about the feasibility of making a car company from scratch. Or perhaps the economics of doing so aren't so favorable.