Tesla buys German automation firm to ramp up production

"Several critical elements of Tesla's automated manufacturing systems will be designed and produced" in Pruem, Rhineland-Palatinate state, the California-based firm said in a statement.

Tesla, founded by tech billionaire Elon Musk, aims to produce 500,000 cars per year by 2018 after taking some 370,000 pre-orders for its mass-market Model 3, which will sell for around 35,000 dollars (just under 32,000 euros). This year, the firm hopes to build between 80,000 and 90,000 units of its luxury Model S and Model X vehicles, 50,000 of them in the second half.

Neither Tesla nor Grohmann offered details of how much money is to change hands in the transaction.

According to founder and chief executive Klaus Grohmann, the German company employs around 700 people. The firm had revenues of 123 million euros in 2015.

"While the agreement is contingent on clearance from regulators, including in Germany, we hope to have full approval and close the acquisition by early 2017," Tesla said.

It added that it hopes to create "over 1,000 advanced engineering and skilled technician jobs in Germany over the next two years".

Germany has been racked by angst in recent months over its high-tech firms being snapped up by foreign buyers, blocking two high-profile deals after failing to hold up the sale of industrial robotics firm Kuka.

So far Berlin's fears have been directed at China, whose firms spent 11 billion euros on German takeovers between January and October according to consultancy EY.

Source: AFP