Tesla plans to buy Mercedes Benz

[rr6013]

As a Mercedes 220 SB owner, past tense, MB can’t be far behind. Progress can’t be stopped just change. MB chose the latter. It may not be enough against a juggernaut.

Tesla automation and AI robotics doesn’t a Mercedes-Benz fit, Mercedes luxury make nor a Mercedes brand new owner. Tesla has nothing M-B doesn’t already own to continue.

Sadly, parochial automotive success is no predictor of future outcome.

 

[FutureBoy]

Germans think 'schmetterling' is a pretty word. They're a weird people. ^-^

-Crissa

Well, to be fair, it is a pretty BIG word... So in Texas that should just make it a pretty word. But I might be off on the math.

 

[anionic1]

They're not supposed to look vastly different. They're supposed to be ultra-competent. Which Alpha vehicle is competent in range, weight, and price? Well, none. They're not aerodynamic. They haven't any working prototypes. They haven't sold any.

People buy Tesla because it does the things. It's fast, efficient, advanced, upgrades itself.

-Crissa

The goal is to get butts in EVs. Not make the most efficient competent car ever. The SEXY line up are definitely not for everyone. And as Ford is showing us. The most efficient, lowest drag coefficient doesn’t necessarily win. I am saying Tesla should buy Alpha because their design will open an entirely new demographic to EVs.

 

[Dids]

The goal is to get butts in EVs. Not make the most efficient competent car ever. The SEXY line up are definitely not for everyone. And as Ford is showing us. The most efficient, lowest drag coefficient doesn’t necessarily win. I am saying Tesla should buy Alpha because their design will open an entirely new demographic to EVs.

I guess a picture is not worth 1000 words. Here are my words. You suggest they buy a company to acquire new designs that look different. I showed you a picture of 4 future vehicles that look very different from SEXY that Tesla produced without having to aquire something as silly as Alpha drawings.

 

[rr6013]

I guess a picture is not worth 1000 words. Here are my words. You suggest they buy a company to acquire new designs that look different. I showed you a picture of 4 future vehicles that look very different from SEXY that Tesla produced without having to aquire something as silly as Alpha drawings.

Picture showing M-B synergy + Tesla by markets

 

[Crissa]

What synergies?

I don't see anything.

-Crissa

 

[DarinCT]

Oh god, please let this idea die.

tl;Dr: "we're gonna dance with who brung us"


The capital expenditures, union contracts, the parts support for a 1989 560 SEL are just a few of the hundreds of reasons that this purchase would never, ever happen. M&A is long, messy, and costly. Ignoring the acid indigestion of purchasing a German company with a different brand, Tesla's main business lines would not have all hands focused on that. Tesla is ahead because it stays ahead not because it goes back to help out the cheap business.

Tesla is stealing market share because it's doing things its way. Buying MB would be the equivalent of saying, "your customers will eventually come to us but we thought we'd spend billions to hurry up the process.". The business term is Customer Acquisition Cost, it's how much does it cost to get a new customer. A very crude way to calculate the CAC in M&A is total purchase price/customer base. For example, Microsoft paid $6,000 per customer when it bought Skype. The calculators has all sorts of problems but it's still used. I'm not even going to look it up because it would be as stupid as MS acquiring Skype with all sorts of weird assumptions. This rumor is never going to happen. No, no, no.

 

[rr6013]

What synergies?

I don't see anything.

-Crissa

Simply.

Every one of those red circles? Yeah, Tesla would dilute its performative brand going into any one of those.

Tesla reinvented what a pickup means when it tackled the F-150 market. Cybertruck was Teslas’ resounding answer. Without needing to reinvent luxury, economy, van, SUV and high tech, M-B provides a brand that already occupies each space for them.

That’s the synergy. M-B doesn’t need Tesla, gigafactories, customers, marketshare or supply chain to spin-up production. The luxury of time is a gift that Tesla can use to transition M-B, its supply chain, EV technology and otherwise continue Mercedes tradition of automotive excellence. Tesla relied on Mercedes when developing its Model S platform. I think both gained a modicum of respect in that exercise from all appearances with MS success.

WallSt will look at its spreadsheets, run the numbers and ask WTF. But it doesn’t give a flying boxcar that Elon Musk is not an unlimited resource. That calculation isn’t included.

Today, WallSt looks like the smartest guy in the room. A decade later, few will be the OEM’s that transition to BEV successfully. Looking back standing 10yrs. in the future, MB+Tesla will look like a sunk opportunity. An opportunity that would have put both manufacturers with rich inventive traditions firmly planted with the deepest foundations.

I’m not famous, but this is my last word…

 

[FutureBoy]

Arguing this idea here is not going to get MB sold to Tesla. I get that you want to see this transaction happen. But the only person who can bring it about is Elon. If you are not presenting directly to Elon, your argument is going nowhere.

 

[Dirt Worker]

Germans think 'schmetterling' is a pretty word. They're a weird people. ^-^

-Crissa

LOL, Why use nine letters when 13 will do. "Oh scheisse! I stepped on a schmetterling!" My E500 was a wonderful car for the first four years. The last four years and it was no longer a schmetterling but a steaming pile of scheisse. Melding Tesla culture with old school thinking seems impossible. They would be better off tearing down and starting over.

 

[JBee]

For one I'm not proposing EM should, rather only if he did, then MB should be the one to do it with.

I doubt our limited capacities would constitute serious consideration, but I think the commercial vehicle side of the opportunities is underappreciated. MB commercial vehicles is big, and operational.

 

[Clustertruck]

There's a couple of good reasons (if this acquisition of MB by Tesla is even possible … is MB for sale, would regulators allow it?) but it doesn't sound like something Musk would do.
It does sound like something an executive team would do for asset valuation and strategy:

1. global dealer network (logistics, field service, collision repair, direct sales)
2. user data (and brand affiliation, supplier contracts, corporate data archives)
3. patents and innovation (Mercedes has at least 7 yr product plans for all its leading vehicles)
4. political leverage (employees vote, politicians win elections by appealing to employers)
5. capital utilization (Tesla has mounting tax liability and limited capacity to spend and offset)
6. Using carbon credits to continue selling light commercial vans
7. Using Mercedes vans as the mule for a rapid to-market electric delivery van to thwart Bezos
8. Converting fleet customers to BEV

Arguments against are less compelling:

1. What would Elon Musk do? (probably not buy an ICE maker with entanglements)
2. Fear and loathing of unions and foreign regulators
3. "Not invented here" syndrome
4. Complexity of restructuring from just-in-time supply-side logistics to vertical integration
5. Culture fit from C suite to factory floor
6. Decades of contracts selling ICE to fleet not ready to convert to BEV

 

[Crissa]

Every one of those red circles? Yeah, Tesla would dilute its performative brand going into any one of those.

...

WallSt will look at its spreadsheets, run the numbers and ask WTF. But it doesn’t give a flying boxcar that Elon Musk is not an unlimited resource. That calculation isn’t included.

That sounds like the opposite of a synergy.

-Crissa

 

[Crissa]

There's a couple of good reasons (if this acquisition of MB by Tesla is even possible … is MB for sale, would regulators allow it?) but it doesn't sound like something Musk would do.
It does sound like something an executive team would do for asset valuation and strategy:

1. global dealer network (logistics, field service, collision repair, direct sales)
2. user data (and brand affiliation, supplier contracts, corporate data archives)
3. patents and innovation (Mercedes has at least 7 yr product plans for all its leading vehicles)
4. political leverage (employees vote, politicians win elections by appealing to employers)
5. capital utilization (Tesla has mounting tax liability and limited capacity to spend and offset)
6. Using carbon credits to continue selling light commercial vans
7. Using Mercedes vans as the mule for a rapid to-market electric delivery van to thwart Bezos
8. Converting fleet customers to BEV

This doesn't sound compelling.

1. This has three negatives: Dealers don't have EV technicians. Dealers don't have short-term profit-motive to sell EV over ICE. Dealers don't know how to sell EVs.
2. A mailing list?
3. Patents for what? If their patents were valid, they would have sued Tesla for infringement already.
4. How did that work out for NUMMI or Grohmann?
5. Writing off stuff they just spent money for doesn't save taxes.
6. They already have the carbon credits leverage.
7. Vans that aren't EV platforms.
8. ...You have to sell new EVs to the fleet customers, they don't just buy whatever you offer.

 

[HaulingAss]

(stuff deleted)

I'm not saying a merger would happen as such, but can anyone tell me of a better fit? Volkswagen has too much baggage and BMW is to small. Or should they look to Ford or GM? Or Toyota.... Lol.

You argued against the idea that there is no way in hell Tesla is buying or merging with Mercedes. However, your argument that you can't think of another company that's a better fit assumes Tesla wants to or needs to merge with someone. Obviously, Tesla is not being forced to pick another auto company to merge with so that line of reasoning is meaningless.

Tesla will not be merging with another auto manufacturer because there is no conceivable way they could extract enough value from any of them to make it worthwhile.