Tesla, the company selling electricity-powered automobiles, and SolarCity, a company selling solar power systems for homes and businesses, have announced they're merging, saying Tesla will buy SolarCity for $2.6 billion (£1.97bn).
Tesla's founder and CEO is, of course, Elon Musk – the same person that is also chairman and the largest stakeowner of SolarCity. So basically, Musk is merging his two companies into one which will offer 'end to end clean energy solutions'. SolarCity was founded by Musk's cousins, CEO Lyndon Rive and director Peter Rive.
You'll have a business that will sell solar panels for you to generate clean electricity, Powerwall batteries where you'll be able to store excess energy, and the Tesla car which also runs on such power.
“It’s really all part of solving the sustainable energy problem,” Mr. Musk said. “That’s why we are all doing this to accelerate the advent of a sustainable energy world.”
Announcing the merger, SolarCity, said it will soon have an 'integrated solar and storage offering', as well as a 'solar product focused on the five million new roofs installed each year in the US'.
The merger will allow both companies to make $150 million in cost savings in the first full year after closing the transaction. Musk even thinks this is an understatement.
“I think $150 million is conservative,” Mr. Musk said. “I think we will significantly exceed that in the first year.”
Next week, SolarCity will release its earnings and said that, even though residential acquisitions were slightly down, it installed more photovoltaic panels than forecast.