Will Tesla Motors Hit The Mainstream Market?

Electric vehicle manufacturer Tesla Motors has been a pacesetter when it comes to lithium-ion powered cars, but with one important caveat: only the rich can afford their $109,000 Tesla Roadster. Even as a second model is being planned (Tesla S), a six- or seven-passenger sedan expected to retail for close to $57,000 when it goes on sale in 2011 or 2012, only people who currently purchase BMW, Mercedes and Lexus models will be able to afford these pricey cars.

Mass Produced Tesla Model

Now, Tesla Motors says that they plan on mass producing a third model that should retail for just under $30,000 thanks to a $465 million low interest loan from the U.S. Energy Department. Expected to go on sale in 2016, the unnamed Tesla vehicle could help the automaker expand from the exotic car segment to a family friendly, budget preserving segment.

For certain, the Tesla Roadster hasn’t been much of a seller yet. Just over 700 cars have been produced on a Heath, UK assembly line, a facility that also builds Lotus models. Tesla is looking at a California facility for the Tesla S, a model that may sell as many as 20,000 units annually, thanks in part to a $7500 federal rebate.

Recently, Tesla announced that the company was investing $100 million to open up a powertrain plant to be located on the grounds of the Stanford Research Park; the company is currently looking at several sites in Southern California for its manufacturing base. Tesla also made it known that it isn’t interested in NUMMI, the former joint Toyota-GM venture that is slated to close down next Spring.

Extended Range Helps Tesla

Despite its high price, the Tesla Roadster has a strong advantage when it comes to range, able to travel as far as 244 miles on a single charge. This compares to about one hundred miles for the upcoming Nissan and proposed Coda Automotive models or to the Chevy Volt which will travel some forty miles before a small gas engine kicks in to extend its range.

The Tesla S is expected to be offered with several different battery range options of 160-, 230- and 300-miles. Tesla is engineering the “S” to allow owners to swap out batteries as needed which means that a buyer could choose the shorter range battery when ordering their car, but rent a larger range battery if needed. No word yet on what sort of battery option would be made available for the third Tesla model.

Source: Automotive News

Avoiding Insolvency, Tesla Motors Borrows $40 Million

America’s all-electric car maker – Tesla Motors – has been wowing fans ever since its small two seat sports car finally rolled off a British assembly line earlier this summer. Lots of delays pushed back the car’s release, resulting in Tesla bleeding through more cash than it had expected to before production got going.

As a result of the delays, Tesla’s financial picture suddenly became very bleak as cash reserves dwindled to below ten million dollars, a small amount of money on hand even for a tiny automaker. Talk that the company would seek bankruptcy protection began to surface, but those fears have now been allayed thanks to new funding that has become available.

Prior to its most recent announcement, Tesla Motors had received cash injections of $145 million from private investors including tens of millions of dollars contributed by Elon Musk who is the company’s chairman and chief executive officer. Indeed, it was Musk and a team of private investors who coughed up the most recent forty million dollars which should be enough money to keep the car company going for the long run.

So far, just fifty Tesla Roadsters have been produced, an all-electric sports car with a phenomenal zero to sixty speed of just 3.5 seconds. Priced at $109,000, the Roadster has some 1200 buyers on its waiting list, people who have put down deposits for the rare sports car.

Tesla says that the new funding will be used to speed up Roadster production while freeing up funding for a second vehicle, the S Model. The “S” is a four door sedan that the company plans to build at a new factory being assembled near San Jose, California. That car was to make its debut near the end of 2010, but production isn’t likely to begin much before summer 2011.

The Tesla Roadster is the first of what will likely become several electric cars produced by a variety of manufacturers worldwide. Fisker Automotive has a sedan in progress, while General Motors will be producing the Chevrolet Volt, a small sedan that should be ready late 2010. Toyota, Nissan, and Chrysler each have several models in the planning and/or production pipeline, while other manufacturers including BMW are currently testing pre-production models of their own.