A $2.5 billion deal between Tesla and Ford to supply electric vehicles for the automaker has been announced, and Tesla CEO Elon Musk has joined the company as a co-founder.
The announcement came on the heels of Tesla’s financials released on Monday, which showed an overall $7.8 billion profit for the year ending March 31, 2017.
Musk’s stake in Tesla, which is valued at $1.6 billion, includes a 20% stake in the company and the remaining 60% owned by him and his wife.
Musk was appointed to the board of directors in 2017.
“The new agreement brings Tesla to Ford’s Ford Motor Company,” Musk said in a statement, which also said that he will be joining Tesla’s board of advisors.
Musk said that the agreement will also bring Tesla to “more than a dozen other major auto companies,” which he described as “large and diverse.”
Musk said he will continue to work with Ford to help drive innovation and bring new products to market.
Musk also joined the board as a non-executive director in 2020.
Ford, which made its first electric vehicle, the Lincoln MKZ, in 2005, has a long history of investing in technology and developing technologies.
Ford’s investment in Tesla is significant because the automakers share a number of business interests, including the development of autonomous vehicles, electric-car batteries, and self-driving cars.
“This is a big deal for Ford,” Musk wrote on his personal blog, “because Tesla will be the first company to bring the technologies to market that will allow us to reach mass production.”
Ford also has a stake in SpaceX, which Musk has said could launch an “insider’s” rockets and spacecraft.
“We’re delighted to be part of a strategic alliance between the world’s leading electric carmakers and our customers, as well as our employees,” Musk continued.
Tesla’s investment with Ford comes at a time when Ford has been working on a plan to acquire a number, if not all, of its assets.
Tesla is working to make electric vehicles available on Tesla’s own service, Tesla Drive, as it attempts to build an autonomous driving capability into its cars.
Tesla Drive is a system that allows Tesla vehicles to be operated by a driver.
The company has also launched its own vehicle-to-car wireless service, called ConnectedDrive.
The new deal between Ford and Tesla will make Ford a more attractive buy for Tesla.
“With this investment, Tesla becomes the first carmaker to be in a position to invest in a technology that will enable a mass-market car to be sold in the United States,” Ford said in its announcement.
Ford is not the only automaker in the auto industry looking to acquire electric vehicles.
Volkswagen is reportedly considering buying the entire electric vehicle market, as the automaking giant is looking to get more mileage out of its diesel engines.
The Volkswagen-owned electric-vehicle unit also has been testing self-propelled vehicles.
“For years, automakers have been looking to build a fully electric vehicle and now that we’ve seen the results, it’s clear that the technology is there to be delivered,” Tim Cook, CEO of Apple, told reporters last week.
Tesla has not disclosed how much it will pay for Ford’s shares in the deal.