From $1 Billion to $10 Billion
On September 21, Daimler, the parent company of Mercedes-Benz, announced it was investing $1 billion in electric vehicles, to be produced at a facility in Alabama. While $1 billion is hardly small change, Tesla CEO Elon Musk thought it wasn’t enough. In a tweet shortly after news broke about Daimler’s plans, Musk said the investment was “not a lot of money for a giant like Daimler/Mercedes. Wish they’d do more. Off by a zero.”
According to Business Insider, the Musk has welcomed competition in the past, saying the efforts of competing companies would be an asset to the evolution of transportation. In this context, his response to Daimler’s investment makes sense.
It was only a day later that Daimler tweeted a response of its own, telling Musk he was “absolutely right” before altering their plans. Mercedes is now allocating $10 billion to the development of new electric vehicles, with an additional $1 billion to be spent on battery production. The move must have met Musk’s expectations, as a couple of hours later, he simply tweeted “Good.”
Daimler is already one of the biggest competitors Tesla has to face, and its recent investments will only help improve its position. So far, the company has debuted an electric semi truck and plans to begin customer trials in 2017. While Musk has similar plans in the works, Tesla has yet to fully unveil its own electric, self-driving truck. Back in May, Daimler partnered with Vivint to create a home solar power solution similar to what Tesla offers with the Powerwall and Solar Roofs.
Of course, Daimler isn’t the only company producing and selling electric cars that can compete with Tesla: Nissan’s 2018 Leaf could be a cheaper alternative, Ford is expected to commit to electric cars in the near future, Porsche’s all-electric car will be out by 2019, and Volkswagen plans to become the leading electric car maker by 2025. If Tesla wants competition, it’s going to get it, and we can only hope it promotes the kind of healthy competition that benefits everyone.