Toyota’s Early Stake In Tesla Would Be Worth A Fortune Today - Here’s How Much Toyota Could Be Sitting On Today If It Had Stayed A Tesla Stakeholder

Tesla and Toyota are the two leading manufacturers of green vehicles today. Both are leaders in their respective niches, with Tesla being the dominant battery-electric manufacturer, and Toyota being stronger with hybrids and plug-in hybrids. It wasn't always this way. Back in 2010, Tesla was just transitioning from the junior varsity league, having retrofitted some Lotus vehicles with battery-electric powertrains and rebranding them as Tesla Roadsters. With its new Model S on the drawing board and no place to build it, Tesla needed an affordable way to enter the car manufacturing business. Preferably a location with unlimited potential, just in case its crazy plan actually succeeded. Toyota had exactly what Tesla needed and was motivated to help out the young green company.

Years before Tesla came on the scene, Toyota had tried to expand its U.S. insourcing and manufacturing footprint in America by partnering with General Motors on a factory and a pair of small five-door hatchback cars that would be made in Fremont, California. The plant became known as the American automobile manufacturing company, a.k.a. NUMMI. GM’s Pontiac division marketed the Vibe, and Toyota marketed the Matrix. The cars were successful offshoots of the Corolla line, also made on the lines, and all went great - until it didn't.

A culture clash, a bad history of a poorly-performing GM plant before the joint venture, and a healthy dose of the United Auto Workers resulted in the joint venture failing. GM's going bankrupt was the final straw, and the plant ultimately closed.

When Tesla needed a plant, Toyota offered up the Fremont facility, and they struck one of those unusual deals that the auto industry often strikes. Tesla would hand over $42 million to Toyota. Then, Toyota would buy $50 million worth of Tesla stock after Tesla went public. Sort of a weird arrangement, but it made Tesla have skin in the game, and then Tesla got its money back by selling Toyota some of its stock. Everybody wins, right?

What Would Toyota’s Early Tesla Stake Be Worth Today?
In 2010, $50 million worth of Tesla stock was valued at approximately $50 million. This is not supposed to be a trick of wording. The stock price of a share of Tesla was under $2.00 per share in 2010. So, Toyota owned roughly 25 million shares. Today, Tesla stock sells for $437 per share. Had Toyota kept all of those Tesla shares, its value would be $437 x 25,000,000. That is equal to $10,925,000,000. Call it eleven billion U.S. dollars.

Another way to estimate Toyota’s stake in Tesla is by percentage. Toyota owned between 2.5 and 3% of Tesla in 2010. Using Tesla's total current market capitalization value and doing the math, the estimate is between $22 billion and $34 billion. Even in today’s big-number economy, that is a staggering amount of money. Now, if stock splits, other weird stock market money tricks make me a big dummy, please go directly to the comments and hammer me. I’m cool with that. I’ll correct the story as needed.

The Non-Monetary Value of a Toyota-Tesla Partnership
Aside from the billions Toyota would have in Tesla stock, or the equivalent cash if it sold the stock today, Toyota and Tesla both would have learned an awful lot from one another. Imagine the melding of best practices that could result? Nobody builds more reliable vehicles than Toyota. Tesla struggled for over 15 years to become mid-pack on quality. Just think how invincible Tesla cars would be if they earned 5/5 reliability scores. Toyota’s line of EVs today is pretty small and relatively unloved by the EV advocates who report on them. Consider if Toyota had a few top-selling battery-electric models in the top three vehicle segments in America instead of one model that sells at a rate so low it is a rounding error.

Toyota Sold Its Tesla Stock By 2016
Toyota sold all of its shares in Tesla by 2016. Toyota spokesman Ryo Sakai said in early 2017:

Our development partnership with Tesla ended a while ago, and since there has not been any new developments on that front, we decided it was time to sell the remaining stake. (2017)

Perhaps Toyota made a good decision to sell then. Maybe the money was invested in things that have yielded a stronger return than Tesla’s stock has. It’s hard to imagine what those automotive-related investments could be.

What say you, Torque News readers? Should Toyota have kept its stake in Tesla, or are you glad the two parted ways back in 2016? Tell us your perspective in the comments below. 

John Goreham is the Vice President of the New England Motor Press Association and an expert vehicle tester. John completed an engineering program with a focus on electric vehicles, followed by two decades of work in high-tech, biopharma, and the automotive supply chain before becoming a news contributor. He is a member of the Society of Automotive Engineers (SAE int). In addition to his eleven years of work at Torque News, John has published thousands of articles and reviews at American news outlets. He is known for offering unfiltered opinions on vehicle topics. You can connect with John on LinkedIn and follow his work on his personal X channel or on our X channel. Please note that stories carrying John's by-line are never AI-generated, but he does employ grammar and punctuation software when proofreading and he also uses image generation tools.