Tesla Patent Giveaway Spurs Speculation Of Possible Deal With BMW

Jun 13 2014, 5:02am CDT | by

Tesla’s generous sounding technology sharing move was seen as more self-interest than charity, and also sparked speculation that a long-term deal with BMW of Germany might be possible.

Earlier this week, Tesla Motors Inc CEO Elon Musk said he would open up the companies technology patents to all-comers.

“Tesla will not initiate patent lawsuits against anyone who, in good faith, wants to use our technology,” Musk said.

Tesla reportedly hasn’t patented some its most important technologies, and their secrets would remain in-house.

The thinking was that it would be better for a small, upstart car manufacturer like Tesla if other competitors were able to make electric vehicles more ubiquitous and this would make them more acceptable to a bigger buying public. It might also help competitors turn away from the move towards fuel cell vehicles.

BMW, which is selling a small electric city car the i3, and is about to launch the i8 plug-in hybrid supercar car, might share its lightweight carbon fiber technology with Tesla, and its production expertise.

“We view the decision as a smart one by Tesla CEO Elon Musk as we believe it will expedite further EV (electric vehicle) development and encourage others to follow Tesla’s technology glide path – we believe it is important that Tesla does not become a technology outlier. Separately, it also revealed that Tesla has held discussions with BMW. We would view any collaboration as exciting given both companies’ innovative approach to alternative drive vehicles,” said Arndt Ellinghorst, analyst with London-based International Strategy and Investment (ISI).

Earlier today, BMW said it had met Tesla to talk about potential collaboration on electric vehicles, but declined to reveal details.

Ellinghorst said it was often the most widely adopted technology and not the best, that was accepted, citing the Microsoft versus Macintosh class in the 1990s and VHS versus Betamax in the 1980s. He said Tesla was believed to be the only car company looking to develop the so-called 18/650 cell format with others using larger format cells, or like Toyota, jumping right over battery only and going straight for fuel cells. Fuel cells wouldn’t need an expensive and extensive re-charging network.

Morgan Stanley analyst Adam Jonas had a mixed view of Musk’s plan.

“We see this as a genuine move to spur industry development of EVs as well as a calculated marketing and PR (public relations) strategy,” Jonas said.

Jonas said Tesla would benefit from widespread competitor application of its battery format and charging infrastructure, although he didn’t expect any major manufacturers to take advantage. Jonas agreed that many manufacturers are getting more excited by fuel cells than battery-only.

ISI’s Ellinghorst didn’t see the release of Tesla patents as a threat to the company.

“We are under the impression that Tesla does not patent many of its more secretive technologies, thereby keeping the information and “know-how” exclusively within the company,” Ellinghorst said.

Some kind of deal with BMW was a tasty prospect.

“We believe collaboration between BMW “i” and Tesla could prove a powerful combination, with BMW lending its expertise in, as well as potentially the supply of, carbon fiber technology and Tesla in turn assisting BMW with electric powertrain development and supporting infrastructure, “Ellinghorst said.

Toyota of Japan owns 2.4 per cent of Tesla and Mercedes-Benz owner Daimler has 4.3 per cent./>/>

 
 

Don't miss ...

 

<a href="/latest_stories/all/all/30" rel="author">Forbes</a>
Forbes is among the most trusted resources for the world's business and investment leaders, providing them the uncompromising commentary, concise analysis, relevant tools and real-time reporting they need to succeed at work, profit from investing and have fun with the rewards of winning.

 

blog comments powered by Disqus

Latest stories

Your Parent Or Kid Moved In: Are You Covered?
A record 57 million Americans now live in multigenerational family households — double the number in 1980, according to a new Pew Research Center study. And I bet many of them have the wrong homeowner’s or renters...
 
 
Pandora Looks to Challenge Terrestrial Radio's Dominance in Cars
Pandora Media is one of the largest Internet radio providers in the U.S. with more than 75 million active users. While the company’s active user count has increased at a robust pace historically, it is likely to slow...
 
 
Are General Manager Salaries About To Skyrocket? Will There Be A Front Office Salary Cap?
Are General Manager Salaries About To Skyrocket? Will There Be A Front Office Salary Cap?
It’s January 2026. New York Yankees owner Hal Steinbrenner gets out of his driverless car and triumphantly marches before the gathered press to introduce his prized new free agent. It’s a record-breaking contract—over...
 
 
Volkswagen AG New Coverage: Trefis Price Estimate at $51
Volkswagen AG is the second largest automaker in the world behind Toyota and slightly ahead of GM, selling 9.72 million vehicles globally in 2013. Established in 1937, Volkswagen AG, along with its 340 subsidiary...
 
 
 

Latest from the Network

Forget injection, pills to cure hardest-to-treat hepatitis C
London/Mumbai, July 28 (IANS) On this World Hepatitis Day, there's good news for patients, particularly from India, for those suffering from hepatitis C. Two new pill-only antiviral drug regimens could provide shorter...
Read more on Business Balla
 
Lenovo to take on Google Glass
New York, July 28 (IANS) Lenovo is developing a wearable smart glass similar to Google Glass with an external battery to be worn on the neck. The device will have a five-megapixel camera, voice recognition and gesture...
Read more on Apple Balla
 
Piper Perabo weds
Piper Perabo has gotten married. The 37-year-old actress tied the knot with director-and-producer Stephen Kay in New York City on Saturday (07.26.14), after getting engaged in September. The 'Covert Affairs' star - who...
Read more on Celebrity Balla
 
Simon Cowell celebrates girlfriend's birthday
Simon Cowell splashed out on jewelry for his girlfriend's birthday. The 'X Factor' star - who has five-month-old son Eric with Lauren Silverman - treated the US socialite to an expensive gift before enjoying some family...
Read more on Celebrity Balla
 
Chatty Ed Sheeran annoys pals
Ed Sheeran has reportedly annoyed his friends by ''spilling secrets''. The 23-year-old singer is incredibly open about his life, and though he hasn't shared anything ''malicious'' about pals including Courteney Cox and...
Read more on Celebrity Balla
 
Stop violence in Saharanpur, says Pakistani daily
Islamabad, July 28 (IANS) The communal violence in Indian town of Saharanpur should be halted at once before it spreads and becomes uncontrollable, a Pakistani daily said in an editorial. The violence was a result of...
Read more on Politics Balla
 
New genetic risk factors for Parkinson's discovered
Washington, July 28 (IANS) In what could lead to new treatment for Parkinson's disease, scientists have identified 24 genetic risk factors involved in the disease, including six that had not been previously identified...
Read more on Apple Balla
 
16 killed in Philippines in Islamist militants' attack
Manila, July 28 (IANS) At least 16 people were killed and 13 injured Monday in an ambush staged by members of the militants group Abu Sayyaf in the Philippines, an official said. The official said the victims were...
Read more on Politics Balla
 
Device to help neuroscientists analyse 'big data'
New York, July 28 (IANS) In the era of unprecedented quantities of information via web, mobile and other internet-based operations, here comes a new device that can help neuroscientists make sense of the "big data"....
Read more on Apple Balla
 
Commonwealth Games medals tally
Glasgow, July 28 (IANS) Australia continue to lead the 20th Commonwealth Games medals tally ahead of England at the beginning of the fifth day here Monday. India's rich haul of medals Sunday helped them leapfrog New...
Read more on Sport Balla