Tesla Motors Inc. said Tuesday it had reached a deal to acquire German firm Grohmann Engineering as part of efforts to boost production to 500,000 cars a year by 2018 and expand its footprint in Germany.
Details of the deal weren't given.
After the transaction is closed the engineering company from Prum, Germany, will be renamed Tesla Grohmann Automation and serve as the initial foundation for Tesla Advanced Automation Germany. The deal, pending regulatory approvals, is expected to close in early 2017.
In a prepared statement, Tesla touted the firm as a leader in "highly automated methods of manufacturing" and said the acquisition brings "a world-class team and unique expertise in-house." The move is also a step in the ambitions of Tesla founder Elon Musk to eventually compete with mass-market rivals.
Grohmann will serve as the headquarters for Tesla Advanced Automation Germany?with other locations to follow?as Tesla plans to add over 1,000 engineering and technician jobs in the European country over the next two years, the car company said.
Last month, Tesla reported a surprise $22 million profitin its latest period, buoyed by record sales of its pricey electric cars and boosting Mr. Musk's plan to sharply lift output ahead of its release of a sedan to compete against bigger car makers.
The Palo Alto, Calif., company reported its first profit after 12 quarterly losses amid a push to generate cash for building its $35,000 Model 3. The company produced about 50,000 cars last year.
The quarter's profit?a record and only the second time ever?was driven higher by improved sales of the Model S sedan and Model X sport-utility vehicle, a reduction in spending and a boost from selling pollution tax credits to other auto makers.
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(END) Dow Jones Newswires
November 08, 2016 08:45 ET (13:45 GMT)
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