Roadster, Good Investment

Roadster, Good Investment

Tesla to be profitable by mid year

Many Roadster owners who have taken delivery of their cars have already decided to purchase a second Roadster or Roadster Sport because they like the first one so much.

Although extraordinarily difficult to close, the $40M financing round completed in December was twice the amount Tesla needed to reach profitability. 

Moving forward two months later, we remain on track with our cost reductions and production ramp, so it appears highly likely that Tesla will meet the goal promised to those investors of becoming profitable by mid year. 

The main reason for this confidence is that Tesla is already in the fortunate position of being sold out until early November, something few automakers can claim, and will soon be sold out of all 2009 production. 

While we have had some cancellations due to buyers experiencing personal financial difficulties, new orders continue to flow in every week from the United States and Europe. We have now produced over 200 Roadsters for customers and there are more than 1,000 customers still awaiting delivery.

Due to our order backlog, it seems that owning a Roadster can be a good investment.  Last September, as the financial and real estate markets began crashing, a Roadster was sold at the Sonoma Paradiso in California wine country for $160,000, well above the current list price of $109,000. 

Many Roadster owners who have taken delivery of their cars have already decided to purchase a second Roadster or Roadster Sport because they like the first one so much. 

The continued strong demand is driven by the fact that the Tesla Roadster has no direct competitors in the marketplace. 

It is faster than almost any sports car on the market (our Roadster beat a Porsche GT3 on the Top Gear test track) and yet uses less energy and has a smaller carbon footprint than a Toyota Prius, even if you assume the worst possible case where all electricity comes from coal. 

I expect sales demand to strengthen further as this awareness grows.  After all, what’s the point of driving another exotic sports car when it is slower than a Tesla and damages the environment? 

Many customers also appreciate the fact that profit from their purchase goes towards helping Tesla develop more affordable, mass market electric cars. The same cannot be said for those who buy gas-guzzling sports cars from other automakers.

Unveiling The Model S And DOE Funding!

On March 26th, at the Tesla design studio located within the SpaceX rocket factory, we will unveil a street-drivable prototype of the Model S four-door Sedan. 

Our objective with the Model S was to create one of the most functional and intuitive vehicles on the road. 

Regarding funding, I am excited to report that the Department of Energy informed Tesla last week that they may disburse funds from our $350M Model S loan application within four to five months. 

The Obama administration has thankfully made it a top priority to move quickly on the Advanced Technology Vehicles Manufacturing loan program, as this will both generate high quality jobs in the near term and lay the groundwork for a better environment in the future. 

This will keep us on track for production to start in 2011.  As a gesture of gratitude for their early support, Roadster owners will receive a $10,000 discount off the price of the Model S Signature series and automatically be first in line for the sedan. 

Tesla is working with Daimeler to produce electric versions of the Smart car.

Daimler Partnership

We announced last month at the Detroit auto show that we have been working with Daimler (maker of Mercedes) for over a year to create an electric version of the Smart car.

Daimler has contracted with Tesla to build the battery packs and chargers for an initial run of 1,000 cars.  Pending the results of that test fleet, the relationship could expand to tens of thousands of cars per year.

Daimler was the first company to commercialize the internal combustion engine and has become a benchmark for automotive quality and reliability. 

My goal from the beginning was to do whatever we can to help end the world’s addiction to oil.  We’ll do that by making cars directly, helping other automakers develop cars, and serving as an example to the rest of the industry. 

Roadster Sport

Model S four-door Sedan: a higher perfomance car with a hand-wound starter.

Tesla is now taking orders for the Roadster Sport, an even higher performance car that does 0 to 60 mph in 3.7 seconds. It comes with a hand-wound stator and increased winding density for lower resistance and higher peak torque. 

The tires are upgraded to Yokohama Ultra High Performance and the suspension features adjustable dampers and anti-roll bars tuned to the driver’s preference – allowing for both softer and firmer rides than the standard Roadster.  Deliveries are expected to begin in late June.