Tesla has always been a revolutionary, but recently the company took their dedication of creating clean, energy-efficient solutions to the next level with a merger with SolarCity, a solar company based in San Mateo, CA. That’s not far from Silicon Valley, Stanford, and UC Berkeley, the tech giants of the world.
As a result of the deal, new solar roofs will be available in the future, possibly as close as next summer. But these aren’t the traditional bulky solar panels. This is an actual roof made of glass with solar cells that convert sunlight into energy for the home. According to Elon Musk, the ambitious CEO of Tesla and a chairman of SolarCity, the solar roofs will be cheaper than regular roofs. (Not to mention the solar roofs will look cooler than a regular roof.)
The deal certainly expands both companies’ horizons. It fits perfectly with their goal of energy efficiency, but will it translate into profit? Tesla and SolarCity have had reduced profits in the past few quarters. While Tesla could get a bit of a bump in profits with their Model 3, their electric sedan, it may not be enough. Musk has to be careful with how they spend their capital. And what about SpaceX? Yes, Elon Musk is involved in yet another company. Musk is the founder and CEO of the American aerospace manufacturing company. While the SolarCity merger has no effect on SpaceX for the time being, I for one would not be surprised if SpaceX were to join the Tesla clan in the coming years.
SolarCity/Tesla is a part of one of many 2016 mergers/acquisitions. From Verizon and Yahoo! to AT&T/Time Warner we will have to see how these mergers play out and what effect they have: from Wall Street to Main Street.