Tesla Agrees to buy German Company to help raise electric car production

Tesla Motors has agreed to buy Grohmann Engineering of Germany. Grohmann Engineering develops automated manufacturing systems for batteries and fuel cells. Tesla has agreed to bus because company seeks to expand its production more than sixfold by the year 2018.

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Unlisted Grohmann Engineering which is based in Pruem, Germany, helped Tesla Motor rivals BMW and Daimler build production facilities for electric car batteries.

Tesla wants to raise its global manufacturing capacity to 500,000 vehicles in the year 2018 from an expected production rate about 80,000 this year. The main production facility of Tesla is in Fremont, California.

In a blog, Tesla said that we have increased the production rate at our Fremont Factory by 400 percent in four years, and we expect this acquisition to accelerate that growth rate.

Tesla still needs to be approved by the cartel authorities in Germany because several elements of automated manufacturing systems of Tesla will be designed and produced in Pruem, Germany’s border with the Luxembourg and Netherlands.

The financials terms of the deal were not disclosed yet. In its blog, Tesla said that the deal is expected to add over 1,000 engineering and skilled technician jobs in Germany over the next two years. At present, Grohmann Engineering has around 700 employees.

On Sunday, Tesla Motors agreed to buy a 74.9 percent stake from company founder and majority owner Klaus Grohmann and a further 25.1 percent stake belonging to private equity firm Deutsche Beteiligungs AG.

DBAG said that Grohmann was specialized in the industrial production of fuel cell and had developed production lines for battery cells and batteries for “numerous” German and international automobile manufacturers. Grohmann was also active in the semiconductor and electronic industries as well as the medical technology and biotechnology sectors.

Tesla said that after the deal, Grohmann Engineering will be renamed Tesla Grohmann Automation. Grohmann Eng. will serve as the initial base for Tesla Advanced Automation Germany with other locations to follow.


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