Toyota Ends Tesla Battery Partnership to Focus on Fuel Cell Tech

Toyota will allow a battery-supply deal with Tesla to expire this year, as it focuses its attention on vehicles running on hydrogen fuel cells rather than all-electric powertrains.

Toyota initially invested $50 million in Tesla in 2010 and signed a $100 million development agreement that led to the production of an electric RAV4 sport-utility vehicle that has sold poorly in limited production.

Toyota is turning its attention to a four-door sedan now known as the FCV Concept that's set for release as a 2015 model-year vehicle. The vehicle will initially be launched in California where that state has agreed to invest $200 million in fuel-cell fueling infrastructure.

In a statement to the New York Times, Toyota said it was reevaluating the Tesla pact. Tesla said it expected the deal to end in a regulatory filing.