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Tesla: 20,000 Annual Model S Sales Needed to Ring in Profits

Tesla: 20,000 Annual Model S Sales Needed to Ring in Profits

There you have it. Tesla, the much-hyped purveyor of all-electric vehicles, has set the bar: sell 20,000 units of its coming Model S sedan and profits will come.

Next year will be the current generation Roadster’s final year of production. So far, some 1400 models have been delivered to at least 30 countries in North America, Asia, and Europe. While the Roadster has been both an impressive engineering exercise and brand awareness builder, the publicly traded Silicon Valley firm has yet to start raking in the dough. And that’s exactly why it’s betting big on the Model S, which it believes will put it in the black.

In an interview with Bloomberg, Tesla chief technology officer J.B. Straudel asserts the niche carmaker needs to move 20,000 Model S sedans per year to be profitable, citing lower battery pack costs and a $56,500 entry MSRP as the primary enablers.

Tesla’s 18560 cell battery pack, which is similar to our everyday laptop battery, has the benefits of preexisting R&D from major tech companies (Panasonic has invested $30 million in Tesla) and advanced economies of scale, not to mention enviable energy density. According to Martin Eberhard, Tesla’s co-founder who later left the company and has famously sparred with Tesla CEO Elon Musk since, the 18560-cell packs likely cost $200 per kilowatt-hour, which is 71- to 75-percent cheaper than large-form cell lithium-ion packs at current analyses. Additionally, the cells have already diverged onto a dedicated EV development route and are expected to see further year-over-year price drops from 6 to 8 percent.

The same Bloomberg report also cites Nissan CEO Carlos Ghosn stating Nissan and Renault may need to sell 500,000 electric vehicles per year for their own program to stay in the black without government aid. At $32,780, the Leaf is considerably cheaper than the Model S and has a head start, having already gone on sale in select launch markets.

Scheduled to start production at the NUMMI factory line in Fremont, California, by mid-2012, the Model S plans to offer three battery pack sizes with varying ranges, a 5.6-second 0-60 mph time, seven seats (extra two for children only), and a futuristic design. Tesla has hired the staff, is doing the homework, and we can now only wait to see how well the finished product turns out.

Source: Bloomberg

Tags:

Future/Spied, Green Cars, Hybrid Car/EV, Sedan, Tesla

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By Benson Kong

*UPDATED* Three Tesla Employees Perish in Plane Crash

*UPDATED* Three Tesla Employees Perish in Plane Crash

A twin-engine aircraft crashed into power lines outside of Palo Alto, California, today, killing all three occupants — reportedly employees of Tesla Motors.

KTVU reports that the Cessna 310 plane, which was headed south, took off in extremely foggy conditions, and crashed shortly after takeoff. Witnesses described hearing two loud booms. One of the aircraft’s wings broke off and hit the back of a nearby house. The crash has reportedly also taken out power within a radius of the site.

Sources tell the TV station that the three men on board the plane were employees with Tesla, with the pilot reportedly being a “high-ranking official” at the company. The San Francisco Chronicle says the plane was owned by Doug Bourn, a senior electrical engineer at the EV company. It is still unknown at this point if he was flying the plane, or if he was even on board. A witness told KTVU that Tesla Chief Technical Officer JB Straubel, who is himself an accomplished pilot, was onboard, but the FAA has not confirmed who the passengers were. Contrary to some speculation based on his ownership of a plane, CEO Elon Musk was not onboard.

According to reports released on Thursday, February 18, the three Tesla employees on board the plane were senior electrical engineer Doug Bourn, electrical engineer Andrew Ingram, and Brian M. Finn, a senior interactive electronics manager, but Tesla and authorities have not confirmed these reports yet.

“Three Tesla employees were on board a plane that crashed in East Palo Alto early this morning,” Musk wrote in a statement. “We are withholding their identities as we work with the relevant authorities to notify the families. Our thoughts and prayers are with them. Tesla is a small, tightly-knit company, and this is a tragic day for us.”


Tesla representatives won’t comment on the accident until more information is known, only confirming that the three passengers were in fact Tesla employees. The Federal Aviation Administration (FAA) is currently investigating the scene and cause of the accident.

Anonymous sources are now telling various news outlets that the passengers aboard the plane were two engineers and a manager, not the executives previously reported. Their plane was headed for Hawthorne, California, near Los Angeles where Tesla rents space from Musk’s company Space X, though they may have been traveling to review a possibly location for the Model S sedan assembly plant.

We’ll continue to update this post as we get further details.

Source: KTVU, San Francisco Chronicle

Tags:

Hottest Cars, Miscellaneous, Tesla

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By Michael Floyd

Elon Musk To Lead Tesla for ‘Several More Years'



Being so busy both with Tesla Motors and SpaceX, Elon Musk may, at some point, be forced to choose one over the other, in order to dedicate himself fully to one of the causes. According to Plug-In Cars, though, he will definitely be sticking around at Tesla for ‘several more years’.

However, we say that Musk, one of the last modern day equivalents (well not really, but close enough) of the likes of Colin Chapman or others like him, is a major part of what makes Tesla appealing. The people who are ‘going electric’ are also those who understand how the world works and want to do their part in its preservation.

So, they will shy away from buying products made by corporations, with visionaries like Musk being a much more appealing prospect for such people. If Elon Musk were to leave Tesla, it would end up becoming a run-of-the-mill carmaker, partly owned by many parties and instead of visions and ideas for the future, there would only be boards and board meetings.

We say Elon Musk should grow old at Tesla’s helm, as it is the only way to keep the company’s core values at the top of their priorities. Also, with the $30,000 (€24,500) all-electric 3-Series rival, the company will take off, financially that is, bringing in more money and allowing them to pay off their loans and investing in having a whole range of increasingly affordable EV alternatives.

By Andrei Nedelea

Romney Slams Tesla, Fisker Again In Final Presidential Debate

Mitt Romney

Mitt Romney

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The CEOs of Tesla and Fisker may have thought they were home free–but it was not to be.

Both startup electric-car companies were named at the very end of last night’s third and final presidential debate.

Republican candidate Mitt Romney didn’t repeat his charge that Tesla Motors [NSDQ:TSLA] and Fisker Automotive were ‘loser’ companies–as he said in the first debate on October 3.

Instead, he took the line that government support for specific companies discouraged all investment in U.S. industry.

And some observers felt he moved beyond criticizing such support to conveying his contempt for plug-in electric cars in general.

Debate watchers among electric-car advocates took to Facebook and Twitter to express their shock over Romney’s tone, as the candidate named “car companies like Tesla and…Fisker” that were making–in his words–”electric battery cars.”

The topic of electric-car companies followed a recurring dispute over whether Romney’s November 2008 editorial in The New York Times, entitled “Let Detroit Go Bankrupt,” promised government support for automakers if they went through a conventional bankruptcy process.

Romney claimed he had advocated for such support; Obama disagreed, saying Romney would have “liquidated” the industry.

After Romney reiterated that he was in favor of government support of industry research, he turned to Tesla, Fisker, and also failed solar-panel maker Solyndra.

According to the complete debate transcript, he said:

I have the kind of commitment to make sure that our industries in this country can compete and be successful. We in this country can compete successfully with anyone in the world. And we’re going to.

We’re going to have to have a president, however, that doesn’t think that somehow the government investing in — in car companies like Tesla and — and Fisker, making electric battery cars — this is not research, Mr. President.

These are the government investing in companies, investing in Solyndra. This is a company. This isn’t basic research. I — I want to invest in research. Research is great. Providing funding to universities and think tanks — great.

But investing in companies? Absolutely not. That’s the wrong way to go.

Technically, the U.S. government has not “invested” in any of the named companies. It does not have an ownership share–unlike its equity holding in General Motors and, previously, Chrysler.

Instead, both car companies received low-interest loan guarantees from the U.S. Department of Energy under its Advanced Technology Vehicle Manufacturing program, launched in 2008 under the administration of President George W. Bush.

Barack Obama

Barack Obama

Enlarge Photo

Romney followed his criticism of Tesla and Fisker by reiterating that he “wanted to make America more competitive” and “do those things that make America the most attractive place in the world for entrepreneurs, innovators, businesses to grow.”

He then said to Obama, “But your investing in companies doesn’t do that. In fact it makes it less likely for them to come here.”

President Barack Obama did not respond specifically to the criticism of Tesla and Fisker.

Predictably, electric-car advocates reacted adversely to Romney’s words.

What I don’t get is why, with all of the crazy things our taxpayer dollars get spent on, Romney keeps beating the Tesla drum,” observed Tom Saxton of Plug-In America on Facebook.

In attacking Tesla, he said, the governor is “beating down a company that’s developing new technology, creating American jobs, reinvigorating the American auto industry, and maybe leading us to an opportunity not to be so totally dependent on the world oil market.”

“What I find interesting is he’s alienated a lot of Republicans who support electric cars–and, yes, there are quite a few of them,” commented electric-car advocate and Montclair, New Jersey, restauranteur Tom Moloughney.

I personally know at least 10 people who are Republicans, who didn’t vote for Obama in the last election, but are going to in this one because of Romney’s stance on the issue.”

Neither Tesla nor Fisker arose during the second presidential debate, and Fisker was only indirectly cited in the Ryan-Biden vice-presidential debate.

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By John Voelcker

Coda Files for Bankruptcy Protection



Electric cars are making headlines the past few weeks as Uncle Sam is questioning them about how they used their allowances. Coda Holdings has already called it quits though, after having sold only a hundred or so cars.

The electric car startup has filed for bankruptcy protection today with the U.S. Bankruptcy Court in Delaware. The company will use this to restructure itself away from the electric car business and back into clean energy.

The Coda electric sedan was a trick car to sell. It lacked awareness and with the looks from a 90s budget car, it was never going to win heart and minds. The model was priced at around $37,000 before factoring in tax rebates and promised to deliver a range of up to 125 miles (200 km) per charge. In January, they announced it would be available for just $24,995 in California, but even that failed to move customers in a big way.

With Fisker looking to be firmly out of the game, this leaves General Motors, Nissan and Tesla in the running.

By Mihnea Radu

Tesla Motors-New York Times dispute continues as reporter speaks out

Tesla Model S profile

After the New York Times published a critical review of the Model S, Tesla Motors CEO Elon Musk accused the newspaper of faking the circumstances of the story. Data logged during the drive seemed to give this accusation merit, and Musk went on to accuse Times reporter John Broder of sabotaging the test. Now, Broder is answering the questions brought up by Tesla’s data in a blog post.

The issue at stake is whether the Model S and Tesla’s Supercharger stations underperformed, or, as Musk says, Broder used both improperly.

In his blog post, Broder reiterates that he was in continuous contact with Tesla employees throughout the trip, and followed whatever advice they gave him.

A major point of contention is whether Broder fully charged the car at each of his stops. In particular, Musk accuses Broder of leaving a public (non-Supercharger) station in Norwich, Connecticut with only 32 miles of range, when he needed to drive 61 miles.

Broder says he was following the advice of a Tesla employee. Both Tesla spokeswoman Christine Ra and product planner Ted Merendino said to charge the car for one hour, Broder says, to restore range lost by cold weather. Apparently, the Tesla employees believed the car still had electricity in its batteries that wasn’t being discharged, in which case there wouldn’t have been a need to charge it further.

In between, Broder stopped at the Supercharger station in Milford, Connecticut. The Tesla data shows that he left after charging the battery to 72 percent. Broder says this was intentional, because it should have given him more than enough mileage to complete the next leg of his trip.

Musk also accuses Broder of driving past a public charging station but, again, Broder says no one he talked to at Tesla had told him about it. He notes that he was on his way to another charging station in East Haven, Connecticut when the Model S gave up the ghost in Branford.

Another major point is the way Broder drove the Model S. In his article, Broder said that at one point he had to set the cruise control to 54 mph and lower the cabin temperature to preserve range. Tesla’s data shows average speeds of 65 to 81 mph, and an average temperature of 72 degrees.

Broder says he drove most of the trip at 65 mph, and perhaps hit 81 mph on a downhill stretch. Still, the logs show him going about 60 mph on one stretch where he claims he was doing 45 mph. Broder offers that the car was delivered with 19-inch wheels and all-season tires, not the standard 21-inch wheels and all-season tires, so the data logging equipment may not have been calibrated.

Broder also says that he “raised and lowered the cabin heat in an effort to strike a balance between saving energy and staying somewhat comfortable.”

Musk accuses him of raising the temperature at the precise moment he said he lowered it in the article, but Broder said that was not true.

In his original article, Broder wrote that he “turned the climate control to low” sometime before crossing from New Jersey into New York, but does not give a specific point.

Finally, Musk said Broder drove in circles around the Milford Supercharger, attempting to run the battery down to zero. Broder says it was dark and he had trouble finding the charger because it was not well marked.

In his blog post, Musk says he called to apologize before coming to the conclusion that he’d been “played for a fool.” Broder says Musk also said the Superchargers should have been 60 miles closer together, and offered the Times another test drive after more stations were built.

By Stephen Edelstein

NUMMI Lives: Tesla and Toyota to Cooperate on Electric Vehicles

NUMMI Lives: Tesla and Toyota to Cooperate on Electric Vehicles

Toyota announced that it couldn’t keep the New United Motor Manufacturing Inc. production facility open after General Motors pulled out of the joint production facility. Toyota, however, has struck a deal to reopen the plant with Tesla and will produce electric vehicles at the facility beginning in 2012.

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Tesla and Toyota will leverage each manufacturer’s strengths — Toyota’s size, engineering resources, and supplier base, and Tesla’s small, fast product development and electric vehicle technology — to create a team of electric vehicle specialists. Toyota will gain knowledge of newer lithium-ion battery technology as Tesla already has a partnership with Panasonic for the technology, and Tesla will learn how to efficiently put vehicles into mass production.

“I sensed the great potential of Tesla’s technology and was impressed by its decision to monozukuri (Toyota’s approach to manufacturing),” said Akio Toyoda, president of Toyota. “Through this partnership, by working with a venture business such as Tesla, Toyota would like to learn from the challenging spirit, quick decision making, and flexibility that Tesla has.

“Decades ago, Toyota was also born as a venture business. By partnering with Tesla, my hope is that all Toyota employees will recall that ‘venture business spirit,’ and take on the challenges of the future.”

Tesla’s Model S sedan will likely be the first vehicle to go into production at the facility when it launches in 2012. Tesla estimates production volumes of around 20,000 units per year and it will likely be joined by platform derivatives and possibly the Roadster. Toyota also has plans to put an electric vehicle into production in 2012, but has not said any more.

In addition to working together on electric vehicle development, Toyota said it will buy into Tesla. Toyota is set to invest $50 million in Tesla in exchange for common stock once Tesla completes its IPO.

“Toyota is a company founded on innovation, quality, and commitment to sustainable mobility. It is an honor and a powerful endorsement of our technology that Toyota would choose to invest in and partner with Tesla,” said Elon Musk, CEO of Tesla. “We look forward to learning and benefiting from Toyota’s legendary engineering, manufacturing, and production expertise.”

Do you think the Tesla/Toyota tie-up is a solid one? Which automaker stands to benefit more from the deal? Will the relationship be successful? Let us know in the comments section below.

Source: Tesla, Toyota

By Andrew Peterson

Tesla outsells the S-Class, the 7 Series, and the A8 – but not the Cadillac XTS?

Tesla Model S

Hard to believe we’d ever be reporting this story, let alone in 2013, but apparently Tesla has sold more units of its Model S than Mercedes, BMW, or Audi did of its respective flagship sedans in the first quarter of the year.

Tesla “delivered 4,750 cars in the first quarter, more than the BMW 7-series (2,338), the Mercedes-Benz S Class (3,077), the Audi A8 (1,462) or the Lexus LS (2,860),” according to an Austin Business Journal report.

Let’s be perfectly, clear, however. Tesla has in no way shape or form outsold Audi, Mercedes or BMW as a brand but rather on a comparable model basis.

Surprising us further, only one automaker’s flagship luxury sedan outdid the Model S: Cadillac’s XTS.

This is surprising to us for two reasons: The XTS isn’t remarkably good nor would we really lump it in with the S-Class, the 7 Series, or the A8. Each of those models is higher priced and far nicer than the Caddy.

Regardless of our niggling issues with the report, we’re ecstatic that Tesla has hit such a sales mark, and so quickly.

If Tesla can pump out several other models alongside the Model S and still retain this kind of momentum, we’ll be even more impressed.

By Nick Jaynes

Tesla officially unveils electric Model S sedan, announces sport edition

Tesla-Motors-Model-S-sedan

Electric car company Tesla Motors officially revealed on Saturday a “beta” version of its Model S sedan to customers who pre-ordered the long-awaited car, at its factory in Fremont, California. Tesla Chief Executive Elon Musk also announced the planned production of a faster version of the Model S, which is capable of accelerating from 0 to 60 MPH in just 4.5 seconds.

The elite group of customers invited to the event were asked to proselytize the benefits of electric car technology while they wait for their vehicles to be delivered next year. Essentially a start-up car company, Tesla faces incredible odds in competing against far larger and more-established brands, like Chevrolet and Toyota.

Prior to production of the Model S, Tesla had only produced one vehicle, the speedy Tesla Roadster sports car, which sells for around $100,000. With the Roadster, Tesla was able to garner praise within the industry and enthusiasm from electric car early-adopters, but sales of the vehicle have yet to turn a profit for Tesla. The Model S, by comparison, will cost around $57,400. The 6,000-vehicle-strong 2012 production run of the Model S is already sold out.

Tesla will offer the Model S with three different battery options, one with a maximum range of 160-miles-per-charge, one with a 230-mile range and one with a 300-mile range. Musk said that it will also offer the option of custom wheels that reduce drag, and give the car a range of up to 320 miles on a single charge.

The sportier Model S will reportedly include an upgraded powertrain that allows the car to reach 60 MPH in 4.5 seconds, as opposed to the 5.6-second time it takes the current Model S sedan. With that kind of speed, the Model S sports version is faster than a Porche 911 Carrera.

By Andrew Couts

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