The German automaker Diamler AG has made a deal with Vivint Solar Inc, one of the so-called “big three” companies in American Solar power to enter the enter the U.S. home market for batteries. The collaboration which was announced Thursday will be an exclusive partnership and help break new ground for both companies. This will be Vivint’s first effort at penetrating the energy storage market and will allow the companies to compete against companies such as Tesla Inc, Sunrun Inc, LG Chem Ltd which offer similar products.

The energy storage market is small, but its rapid growth fueled by the falling cost of lithium-ion batteries. Home battery systems are an essential part of the trend toward solar power as they allow customers to store solar power generated during the day for use at night when demand is at its highest level. Batteries can provide a reserve of power, allowing consumers to avoid paying high evening utility rates, as well as provide backup power in the event of a power outage.

The batteries will be offered through Diamler’s Mercedes-Benz Energy subsidiary which the company formed last year. The entry of the well known luxury automobile brand is in direct competition with Tesla and its Powerwall batteries. This echos a larger trend wherein well known brands expand beyond their original product offerings taking advantage of their established reputation for quality.

The battery systems will be composed of 2.5 kWh modular batteries that can be combined to create a system as large as 20 kWh. Such a system would cost approximately $13,000 including installation. This largest size is more expensive than the competing Tesla Powerwall system which is 14 kWh and according to the Tesla website costs $6,200. However, the Tesla system pricing does not include the cost of installation which can be up to $2,000 and has approximately 30% less capacity than the Diamler/Vivint system