Tesla Motors and Toyota said on Friday they will develop an electric version of the Toyota RAV4 SUV, formalizing an agreement signed between the companies in May.

The vehicle will be RAV4 with an electric powertrain supplied by Tesla. Telsa said that it has already built a prototype and hopes to make a fleet of prototypes in a year.

The electric RAV, which Toyota stopped making in 2003, is coming back through a deal with Telsa.
(Credit: CC Mike Weston/Flickr)

The goal is to release a car to the U.S. army promotion  by 2012.

In May, Telsa and Toyota announced an agreement where Toyota invested $50 million in Tesla and they two pledged to collaborate on electric vehicles. Tesla also purchased the NUMMI plant in California.

It wasn't until a few weeks later, though, that Toyota and Tesla signed a specific production agreement .

By making an electric RAV4 with Telsa, Toyota is bringing back a popular electric vehicle now highly sought by electric car enthusiasts. The all-electric SUV, made from 1997 to 2003, had a range of 100 miles and reached speeds of up to 78 miles per hour.

Tesla made a splash when it went public at the end of last month, but its stock has since drifted downward and is now below the price at the end of first day of trading.

The electric car company has pinned its fortunes on the production of the Model S, a sleek all-electric sedan which Telsa plans to start making at the NUMMI plant in 2012. It is also seeking to make revenue through its powertrain business.