Tesla-Toyota partnership in near future

Tesla and Toyota have worked together on Toyota's recent version of the RAV4 EV. Tesla basically took care of the powertrain, while the rest was based on Toyota's gasoline-powered RAV4. But sadly, the RAV4 EV was only made in small numbers (2,600 units for the first 3 years) and only sold in California, mostly because regulators asked for a certain minimum number of zero-emission vehicles.

Was this just a prelude to something bigger? Elon Musk has just dropped hints that a "significant" project between Tesla and Toyota could see the light of day within 2 or 3 years, and this time, it would be for a vehicle made in larger numbers than the RAV4 EV.

© Toyota

Musk said there were no concrete plans for a new vehicle with Toyota but dangled the possibility of a bigger project soon.

“I think that if you look out maybe two or three years from now, that I would not be surprised if there is a significant deal with Toyota,” Musk said today at a ceremony to deliver the first Tesla Model S sedans to customers in Japan.

“My best guess is that it would probably be something significant, maybe on a much higher volume level,” he said.(source)

Nothing really concrete here, but knowing how these things work, I don't think Musk would have even mentioned it if he wasn't fairly certain that a deal could be reached. Why create expectations if you're not fairly sure they can be met?

© Toyota

It would make a lot of sense for Toyota too. While they've been a leader in hybrids for over a decade, they lag in electric vehicles. Why not partner with the leader of the field? Maybe they could make a new Prius model (the Prius E?) that is 100% electric, or make an electric version of some of their best-selling vehicles like the Camry and Corolla?

© Toyota

We also have to remember that Toyota owns 2.4% of Tesla, so they have a financial incentive (not a huge one for a company the size of Toyota, but still) in helping our the smaller company.