Tesla Will Provide Drivetrain, Batteries for Electric Mercedes-Benz B-Class Car

Tesla Motors Inc. (Nasdaq: TSLA) will provide drivetrain, batter and electric motor technology for an electric vehicle (EV) version of the Mercedes-Benz B-class beginning in 2014, according to Auto Week.

The B-class collaboration between Tesla and Mercedes-Benz is not terribly surprising given that Mercedes-Benz parent company Daimler AG (Frankfurt: DAI) owns a 4.7 percent stake in the Palo Alto-based electric car company, according to Auto Blog.

Stuttgart's Daimler already offers a Tesla-powered electric car, the Smart ForTwo EV. The decision to offer the Tesla-powered, all-electric Mercedes-Benz B-class means that plans for a gasoline-electric, range extended electric vehicle (REEV) will be put on hold, according to Auto Week.

Tesla Motors Inc. (Nasdaq: TSLA) shares rose 1.53 percent to $31.13 Thursday morning. Daimler AG (Frankfurt: DAI) shares fell 1.39 percent to €36.50 ($45.34).