LOS ANGELES (Bloomberg) -- Toyota Motor Corp. will pay affiliate Tesla Motors Inc. about $60 million to develop batteries, motors and other parts for an electric-drive vehicle the companies are collaborating on.
The terms of the deal, initially announced in July, were completed Oct. 6, California-based Tesla said Wednesday in a regulatory filing. Tesla is modifying its lithium-ion battery packs, motors, power electronics, gearbox and software for Toyota's compact RAV4 sport-utility vehicle.
“Its initial investment in Tesla, and now this payment, show Toyota has decided electric cars aren't going to be fringe vehicles,” said James Bell, executive market analyst at Kelley Blue Book in Irvine, Calif. “Companies like Nissan and GM are heavily committed to electric-car programs, and it looks like Toyota has decided to step up its efforts.”
Toyota showed a prototype version of the electric RAV4 to U.S. dealers last week in Las Vegas. The world's biggest seller of hybrid cars, led by its Prius model, bought a $50 million stake in Tesla this year with a goal of collaborating in battery-powered vehicles.
Tesla this month took over Toyota's former joint-venture plant in Fremont, Calif., and is modifying technology used in its $109,000 Roadster sports cars for the compact Toyota SUV. The electric RAV4 is due by 2012, Toyota said in July.
The $60 million payment from Toyota is only for research and development work done by Tesla and not for components that will be eventually supplied for the vehicles, said Khobi Brooklyn, a spokeswoman for Tesla.