Report Claims Mercedes Ditches Tesla And Upgrades Electric Car To 310 Miles Of Range

Aug. 19, 2015 3:36 PM ETTesla, Inc. (TSLA)MBGYY324 Comments
Anton Wahlman profile picture
Anton Wahlman


  • Auto Motor Und Sport, the leading German auto magazine, reports that Mercedes will stop buying Tesla powertrain components - batteries, motors, etc.
  • Tesla's recent 10-Q and 10-K filings provide numbers that help an investor quantify the financial impact to Tesla of lost sales to Mercedes.
  • Adding insult to injury, the article also says that this new all-electric Mercedes will get approximately 310 miles of range.
  • The timing of this new all-electric Mercedes is uncertain, but is unlikely to arrive in US dealerships in the next 12 months.
  • For Tesla to lose its Mercedes revenue, and to gain a new long-range electric car competitor, is not a positive incremental investment development.

Back in 2009, Daimler (DDAIY) (owner of Mercedes) bought a 9.1% stake in Tesla (NASDAQ:TSLA), which was sold less than a year ago. Now we learn why.

Germany's most prestigious automag, Auto Motor Und Sport, which usually has some of the best scoops about the future product plans of German automakers, now reports that Mercedes will replace Tesla as a vendor for its B-Class all-electric car. Starting a little over a year ago, Mercedes started delivering this car to US customers, to begin with in California.

Thus far, for the first seven months of 2015, 1,368 of these cars have been sold in the US, up from 774 in 2014. I do not have the complete statistics for how many were sold outside the US.

For this car, Daimler purchased the entire battery-electric drivetrain from Tesla - the battery, the electric motor, the inverter and the associated components. This has generated very helpful revenue for Tesla. From TSLA's most recent 10-Q filing:

As of June 30, 2015 and December 31, 2014, our accounts receivable were derived primarily from amounts to be received from financial institutions and leasing companies offering various financing products to our customers, sales of regulatory credits, as well as the development and sales of powertrain components and systems to automotive original equipment manufacturers (OEMs). As of June 30, 2015, we have two customers who individually account for 11% and 10% of our accounts receivable.

And from Tesla's most recent 10-K:

Powertrain component and related sales for the periods presented were related to powertrain component sales to Daimler under the Mercedes-Benz B-Class Electric Drive program which commenced in April 2014 and to Toyota under the RAV4 EV program. Powertrain component and related sales for the years ended December 31, 2014, 2013 and 2012 were $113.3 million, $45.1 million and $31.4 million. During the third quarter

This article was written by

Anton Wahlman profile picture
I am a former sell-side analyst -- UBS 1996-2002, Needham 2002-2006 and ThinkEquity 2006-2008. These days I review automobiles and other technology products, as well as analyze the automotive and technology industries, and coming up with long/short ideas. I also continue to write (less frequently) on macroeconomics and politics.

Disclosure: I am/we are short TSLA. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: At the time of submitting this article, the author was short TSLA. However, positions can change at any time. The author regularly attends press conferences, product launches and similar events hosted by automakers, and sometimes travel logistics around those events are paid for in whole or in part by the hosts of those events. The author regularly tests cars provided by the automakers.

Recommended For You

Comments (324)

To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.