Mercedes will stop using Tesla’s drivetrain for the next gen electric B-Class

According to a new report from a German publication, Auto Motor und Sport, Mercedes will not use Tesla’s drivetrain for the next generation of electric B-Class. Mercedes will bring more development in-house to try to achieve a range of 500 km (311 miles). It’s not clear when the next generation is due.

Tesla Motors has a long-standing partnership with the German automaker. In 2009, Daimler, the company behind the Mercedes brand, acquired a ~10% stake in Tesla. Tesla started supplying electric drivetrains to Daimler for the Smart EV and then later on developed a new electric motor and battery pack for Mercedes’ B-Class which started deliveries late last year. 

Tesla supplies Mercedes with a smaller electric motor and battery pack than those used in Tesla’s Model S. The B-Class is equipped with a 36 KWh battery pack which allows for 124 miles (200 km) of range, compared to Tesla’s smallest battery pack for the Model S: 70 KWh for 230 miles (370 KM) of range.

Daimler sold its remaining shares of Tesla in October last year, but at the time, they reaffirmed their partnership with the Silicon Valley company. A few days later, Toyota also sold their shares of the company.

Tesla had a similar electric drivetrain deal with Toyota. The company was supplying drivetrains for Toyota’s EV Rav4, but the deal ended last year. Elon musk, Tesla CEO, said he “wouldn’t be surprised if there is a significant deal with Toyota and Tesla” in the next 2 to 3 years. Toyota is heavily investing in fuel-cells, but the company is shy on the battery-powered front. Some speculated that Toyota wanted a new supply deal with Tesla, but the young company didn’t have the capacity to supply the volume required by the auto giant.

Neither Toyota nor Daimler said anything about the end of their supply partnerships with Tesla having anything to do with selling their stakes in the company. Most likely, the sales were simply about taking profit on their investments. Daimler, which invested $50 million in Tesla, sold their remaining shares for $780 million last year.