Tesla

Elon Musk: Tesla could merge with competing automaker

The surge in its stock market price gives Tesla ideas: the manufacturer is seriously considering buying another car manufacturer. Without giving further details for the time being.

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Tesla boss Elon Musk received the Axel Springer Award in Germany on Tuesday. A price that seems tailor-made for the entrepreneur since the latter rewards “Extraordinary personalities who are particularly innovative, who generate and change markets, influence culture and at the same time live up to their responsibility towards society”, as can be read on the official website.

However, there was one or two very interesting things said there. Elon Musk notably spoke with the CEO of the Axel Springer Group, Mathias Döpfner, who asked him if the takeover of a competing automaker was on the table. It must be said that in recent years, the Tesla share price has soared. To the point that in 2020 the manufacturer weighs more than 548 billion dollars. And that Tesla is today considered the most important manufacturer in the world.

Tesla wants to let its competitors come to it, but ensures it will not reject a merger proposal

Tesla’s market capitalization is in fact more than twice the capitalization of the 2nd largest automobile manufacturer in the world, Toyota (190.31 billion dollars), more than 5 times that of Volkswagen (94.20 billion dollars) and more than 10 times. Honda’s capitalization ($ 48.78 billion). As saying that under these conditions, any buyout or merger would not dilute Tesla’s shares too much.

Elon Musk immediately refuses to talk about a hostile takeover bid: “We are especially not going to launch a hostile takeover”, explains the entrepreneur, before immediately qualifying his remarks, if someone [un autre constructeur, ndlr] tells us it would be a good idea to merge with Tesla, we will have this conversation“.

For now, we do not know how seriously Elon Musk thinks about this possibility. Since its inception, the manufacturer has had two strategies: to buy existing production units like the Fremont factory in California, or develop your own capacities with the construction of Gigafactory.

The takeover of a competitor could mean that Tesla is seeking to reach other market segments by surfing the notoriety of another brand for example. What do you think of this possibility? Share your opinion in the comments.

Source: Electrek