Toronto, Ontario — General Motors (GM) has recently acquired Tooling and Equipment International (TEI), the company that formerly helped Tesla perform giga-casting manufacturing to produce large body parts for cars in one piece.
According to two sources with direct knowledge of the recent deal, with this new contract, GM is hoping to continue jumpstarting its own push toward making cars cheaply and efficiently. Moreover, the sources said that GM paid less than $100 million to acquire TEI.
“General Motors acquired Tooling & Equipment International (TEI) to bolster its portfolio of innovations and secure access to unique casting technology,” GM originally said in a statement to Reuters.
As part of that program, GM signed a guaranteed, long-term contract and TEI invested in a new dedicated production line for the Celestiq at its base in Livonia, a 25-minute drive from GM’s Detroit headquarters, one of the sources said
Comparatively, sources from Tesla said that without TEI, the automaker now has to rely on three other casting specialists it has used in Britain, Germany and Japan. Sources also mentioned that Tesla is looking to fill the role TEI performed and is even considering developing in-house methods to cut its reliance on outside suppliers.
“Bringing TEI into the GM enterprise builds on decades of the company’s own casting experience and provides a competitive advantage with strategic castings for future low volume products like the Cadillac Celestiq,” GM said in its statement.
“TEI will remain its own business entity with GM as its parent company,” GM finished.
At this moment, Tesla and TEI president Oliver Johnson have not issued any statements on the new contract agreement.
