Elon has already established Tesla as one of the leading electric car manufacturers on the market, and now they are formally extending their focus in clean energy. The company plans to merge with SolarCity that is also led by Musk in an all-stock deal that values the company at $2.6 billion.
Both companies want to be more vertically integrated offering various clean energy products to consumers. This will put both companies in a good position in the market giving them some financial leverage in the emerging market.
Musk’s vision for the “new” Tesla (post-merger) is to become a leader in the renewable energy business. Tesla has plans to add 30,000 new employees, save $150 million in the first year after the transaction is completed and sell more products (Solar City panels) to its eco-friendly customers. Meanwhile, Solar City will benefit because: it will not go out of business, will have access to Tesla’s distribution network (effectively slashing the cost to acquire new customers – which is currently 30% of the price of a solar panel, (renewable energy-friendly) customers, and establish strong brand presence.
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