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Google Almost Bought A Near-Bankrupt Tesla In 2013

With his electric car company on the verge of bankruptcy, Elon Musk turned to Google and very nearly sold Tesla.

Google Almost Bought A Near-Bankrupt Tesla In 2013
[Photo: Flickr user Steve Jurvetson]

In early 2013, Tesla was near bankruptcy. Founder Elon Musk turned to his friend Larry Page, cofounder and CEO of Google, to buy out Tesla. The deal went past handshake territory and both company’s lawyers drafted up negotiations, but somewhere along the way, the deal fell through. By May 2013, Tesla had turned everything around and posted its first quarterly profit. A report in Bloomberg today reveals just how close Musk came to selling Tesla to Google.

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Tesla’s flagship car, the Model S, had growing pains after launching in June 2012: Software glitches and cost-saving interior design irked buyers, which led to negative word of mouth. That almost sank the company, says Bloomberg, and after Valentine’s Day 2013, Musk was negotiating with Page to buy Tesla out. Bloomberg’s sources say that Musk kept stipulations in the deal that would have let him stay on to run Tesla at least until the company released its third-generation electric car.

But the deal fell through and Musk pushed hard to fix the defects. Tesla turned things around by the middle of 2013, thanks in part to an initiative that had employees from every Tesla department make sales calls to customers.

Bloomberg’s report cites anonymous sources; neither company will officially comment on the deal. According to the Bloomberg story–itself a segment from the upcoming book Elon Musk: Tesla, SpaceX, and the Quest for a Fantastic Future by Ashlee Vance–Page implied that the deal was far from done:

“I don’t want to speculate on rumors,” Page said when I asked him if Google had considered buying Tesla, adding that a “car company is pretty far from what Google knows.”

It is unclear whether that quote is contemporary or from 2013, but Google has certainly become something of a car company since then. The company’s self-driving car is real enough, despite its Playmobil-esque, smiley-car design. But even if the deal fell through in 2013, Google may have rubbed off on Tesla: In September 2013, Musk talked about how Tesla would integrate self-driving features into its cars.

The same cannot be said for Apple, which met with Musk in February 2014 to talk about a rumored merger, but that possibility was shot down by Musk himself. A merger or acquisition would just distract Tesla from refining its mass-market electric car fleet.

[via The Verge]