Two high-profile, energy-progressive companies, Tesla Motors Inc (NASDAQ:TSLA) and SolarCity Corp (NASDAQ:SCTY) , have much in common. Visionary CEO Elon Musk runs the former and sits at the head of the board of the latter. Musk’s cousin, Lyndon Rive, is the CEO of SolarCity Corp (NASDAQ:SCTY). Both companies are based in Northern California, and both aim to disrupt their industries – automobiles and the solar business. The two even trade in tandem on the Nasdaq exchange. An announcement this week involving the two companies shows an even closer relationship – Tesla Motors Inc (NASDAQ:TSLA) may provide batteries to SolarCity. The concept could spell big benefits to both firms.
It only makes sense that Tesla and SolarCity Corp (NASDAQ:SCTY) would explore possible collaborations. SolarCity chairman Elon Musk need only to make a phone call over to Tesla Motors Inc (NASDAQ:TSLA) CEO Elon Musk to discuss how the two companies can work together in their goals of redefining their respective industries.
As part of the agreement, Tesla Motors Inc (NASDAQ:TSLA) is providing 8-kilowatt-hour batteries to SolarCity Corp (NASDAQ:SCTY) for testing purposes. The solar company’s goal is to eventually use these batteries as part of an all-encompassing energy package for homes.
During the day, homes can harvest the sun’s energy with solar panels. The batteries will store up energy throughout the day as well. The idea is that once night falls, those batteries will then power the homes until the sun rises again the next morning.
Pretty reasonable, right?
The strategy is part of SolarCity’s effort to reduce its dependency on the traditional utility companies. Currently, the company sells the energy it captures via the solar panels to utilities, which then lease it back to consumers at night. So far, it’s been a successful symbiotic relationship – SolarCity Corp (NASDAQ:SCTY) has seen tremendous growth since inception, continuing through its IPO late last year. The stock is up more than 200% since its market entrance in mid-December.