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How oil companies are competing with Tesla

Global oil producer Total is hedging its bets in a $1.1 billion dollar deal to buy Saft, a French maker of nickel and Lithium batteries.

Total S.A. a global integrated oil and gas company offered €36.50 per share (a premium of 38.3% over Friday’s close) for Saft a French based company designing and manufacturing batteries for industrial and transportation sectors. This deal will position Total to be a major player in battery technology for transportation as well as renewable energy storage. This acquisition follows the 2011 purchase of a majority stakeholder in San Jose based solar power company SunPower.

At least one major player in the oil industry sees where the market is headed and is willing to invest in alternative resources. With the 2 components of solar and battery storage the next logical step could be a competitor for Tesla’s Energy division.

Tesla offers both the Powerwall, and Powerpack units for home and commercial use. The Powerwall provides 6.4Kwh of power storage to run your home in the event of a power outage or during high peak rates in some locals.

Another option for Total would be to offer their newly acquired battery technology for the every growing list of electric cars available on the market. With traditional manufactures moving toward the electrification of their fleet battery technology will be in high demand. What irony if Total overtakes the other big oil companies due to their efforts in manufacturing batteries for electric cars.