Tesla sees critical supplier get snatched up by GM

[MEDICALJMP]

Tesla sees critical supplier get snatched up by GM

Fred Lambert. Nov. 15, 2023

https://electrek.co/2023/11/15/tesla-critical-supplier-snatched-up-gm/


Tesla has seen one of its critical suppliers for its gigacasting technology, TEI, be acquired by General Motors.

Tesla has been pioneering the use of bigger cast parts in its vehicle bodies over the last few years.

It started by replacing 70 rear body parts with two giant ones in Model 3, and since then, it has progressed into producing Model Y bodies with just a few parts produced by giant casting machines.

After being skeptical at first, the rest of the industry has started to follow with similar efforts.

Now we learn that GM is also dipping its toes in the space, and it is directly affecting Tesla by doing so.

Reuters reports that GM has acquired a Tesla supplier in the space:

For years, a little-known company called Tooling & Equipment International (TEI) has helped Tesla push back the frontiers of “gigacasting”, the process it pioneered to cast large body parts for cars in one piece to save time and money.

Until 2023, that is. TEI is now part of General Motors after agreeing a deal that may have flown under the radar but is a key part of the U.S. automaker’s strategy to make up ground on Tesla, four people familiar with the transaction said.

More specifically, TEI is a specialist in sand casting techniques, which Tesla uses to create its molds for gigacasting.

The news of the acquisition comes just after it was reported that Tesla had achieved a “breakthrough” using “industrial sand with 3D printers” to create even bigger cast parts that could eventually result in entire vehicle bodies being produced in a single part.

GM confirmed the acquisition of TEI:

General Motors acquired Tooling & Equipment International (TEI) to bolster its portfolio of innovations and secure access to unique casting technology.


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Since this wasn't a big secret, Tesla must have a back up plan.

 

[Kahpernicus]

Considering the shared tech with spacex, it wouldn't surprised me to see that Tesla has moved in to direct metal printing for their tools.

 

[Diehard]

GM depends on supercharger network to sell more EVs. This move makes sense for them.

 

[PilotPete]

"Tesla sees critical supplier get snatched up by GM"

I think the title is insanely misleading. The truth is, this company was for sale for months. Tesla had the opportunity to buy them. IF they were all that "critical", do you think Tesla would have just let them sit for sale? And if they were on the market for that long, would you really say they were "snatched up"? Someone editorializing a bit? FUD much?

 

[carpedatum]

Lambert does love the FUD-for-clicks trade. Every once in a while he posts something really stupid like this - I can't read his blog anymore for just that reason.

"Now we learn that GM is also dipping its toes in the space, and it is directly affecting Tesla by doing so." Well, really, Fred, what sort of influence on Tesla does this actually have? Tesla currently gets its Gigapresses from Idra Group. TEI, according to Reuters, has just been "involved in gigacasting mold prototyping", and is among four (known) firms that Tesla has worked with on the topic. Tesla will almost certainly in-source that function, perhaps through an acquisition of its own, at some point. In the meantime, I doubt that anybody at Tesla is losing sleep over TEI.

I do wish GM luck with TEI and with modernizing its vehicle designs for more efficient manufacturing, someday. It doesn't bode particularly well though, that their iniital application for TEI's tech is a $340k Cadillac. Really, at that price they could mill every chassis component out of solid aluminum and still make a profit.

The original Reuters article he mentions is actually pretty good (though the headline they chose for it is also a little over the top).

 

[Crissa]

"Tesla sees critical supplier get snatched up by GM"

I think the title is insanely misleading. The truth is, this company was for sale for months.

Were they? Because the article seems to indicate that dealings were done without revealing to the public.

If it's really a critical supplier, then acquisition would need to be approved by FTC...

-Crissa

 

[PilotPete]

Were they? Because the article seems to indicate that dealings were done without revealing to the public.

If it's really a critical supplier, then acquisition would need to be approved by FTC...

-Crissa

According to reports, TEI President Oliver Johnson had put the company on the market last year sometime. While the actual deal with GM was not negotiated in public, the company’s availability was. Sale price was less the $100M, but assumed over $80M. Tesla could have made that deal without blinking. And if TEI was looking for quick money, trying to sell to Tesla would likely be on their radar.

 

[Crissa]

According to reports, TEI President Oliver Johnson had put the company on the market last year sometime. While the actual deal with GM was not negotiated in public, the company’s availability was. Sale price was less the $100M, but assumed over $80M. Tesla could have made that deal without blinking. And if TEI was looking for quick money, trying to sell to Tesla would likely be on their radar.

Yeah, but with everything done hush-hush, we don't know if Tesla made an offer or not.

-Crissa