Tesla: A $1.33 Billion Pile of ... What?

If you've been waiting to buy Tesla Motors (Nasdaq: TSLA  ) , your chance has arrived: The California electric-car maker went public on Tuesday at an initial share price of $17 -- considerably above the expected $14 to $16 -- and opened higher still, hitting $21 during the day's trading.

Tesla's offering, the first by an American carmaker since Ford's (NYSE: F  ) in 1956, netted Tesla some $202 million in much-needed proceeds. Add in an additional $50 million from Toyota (NYSE: TM  ) , arriving momentarily via a post-IPO private placement, and it's clear that the cash-hungry automaker has acquired a sizable nest egg.

Tesla hasn't been coy about what it plans to do with the money. It'll fund the development and production of the Model S, a four-door sedan that is the company's first attempt at a mainstream, mass-market model -- one that will hopefully lead the money-losing firm to profitability.

At $17 per share, Tesla -- which was reportedly close to bankruptcy not long ago -- is valued at about $1.33 billion. That's a lot of money. But what do those new shareholders really own?

The next Amazon? Or the next Pets.com?
Let's stipulate this right up front: As things look now, electric cars are (probably) the future of the automobile. After a couple of decades of dithering around with fuel cells, hydrogen-powered internal combustion, and other approaches to a low-carbon, low-oil future, most of the auto industry's heavy hitters have focused on cars with electric drivetrains powered by lithium-ion batteries, with or without ancillary gasoline engines. Investor excitement around electric cars generally is probably deserved.

But that was true -- generally -- of investor excitement around the Internet in 1998. So here's the question: Is Tesla the future of electric cars?

Groundbreaking technology ... but the ground has already been broken
Tesla's first model, the much-hyped (with some justification) Roadster sports car, was an impressive product -- the first really nice, usable, fun electric car. But technologically, it's nothing special, at least when viewed from a 2010 vantage point. It's essentially a whole bunch of laptop computer batteries (6,831 to be precise), an electric motor, and a special single-speed transmission built by BorgWarner (NYSE: BWA  ) , cobbled together and stuffed into a substantially reworked Lotus Elise.

Now, that's not a bad thing. The Roadster is a well-finished car that's exceedingly fun to drive, has decent range, and is backed by kid-glove customer service. But technology -- and the auto industry -- have moved on a long way since the Roadster was unveiled in 2006. Heavy-hitter auto suppliers like Johnson Controls (NYSE: JCI  ) and Magna International (NYSE: MGA  ) have made enormous investments in electric-car technology, developing special large-format lithium-ion batteries specifically for automotive use that are expected to be in mass production in the very near future. Even tech giants like Microsoft (Nasdaq: MSFT  ) have waded in; Mister Softy is working with Ford on systems to manage recharging of the automaker's upcoming electric models.

And now come the heavy hitters
More to the point, Nissan and Ford are expected to launch mainstream all-electric models by early next year. These cars, which will be bristling with advanced technologies, will sport familiar badges and mass-market price tags (under $30,000 after tax breaks), and they'll be sold and serviced via extensive dealer networks that are already familiar to consumers. Toyota, General Motors, and others are expected to follow with all-electric models and advanced "plug-in" hybrids like the Chevy Volt and upcoming plug-in Toyota Prius.

Contrast that with the Model S, which will be considerably more expensive (about $50,000 after tax breaks) while using technology similar to the Roadster's. Tesla has already announced that the Model S will feature laptop-type battery cells from Panasonic. But unlike the Roadster, which is largely built by outside suppliers, the Model S will be built by Tesla itself, a company with zero experience in ground-up mass production of cars, notwithstanding possible help from Toyota.

The daunting road to success
Tesla says that it needs to sell 20,000 Model S autos a year to make this thing work. But the Model S and Tesla -- a start-up that has yet to book a profitable quarter, and that has sold about a thousand cars ever -- are going up against companies with vast R&D resources and brands that are global household names. And they're doing it with a significant cost/price disadvantage, no experience in this kind of manufacturing, and with no disruptive new technology. In other words, there's no real first-mover advantage.

How do they win? For that matter, how do they survive? For investors, where's the upside?

I can't come up with a convincing answer to those questions. If you can, buy the stock.

Read more Foolish coverage of the global auto industry:

Fool contributor John Rosevear could see himself buying a Model S, but is less inclined to own Tesla's stock. He owns shares of Ford. Microsoft is a Motley Fool Inside Value pick. BorgWarner and Ford are Motley Fool Stock Advisor selections. Motley Fool Options has recommended a diagonal call position on Microsoft. Try any of our Foolish newsletters today, free for 30 days. The Motley Fool has an electrifying disclosure policy.


Read/Post Comments (28) | Recommend This Article (26)

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  • Report this Comment On June 29, 2010, at 4:12 PM, DevinLM wrote:

    I don't like the fundamentals of this company one bit. While I'm rooting for them to succeed as one potential path toward reducing our oil dependency, my belief in their future is not strong enough to invest in them.

    But...there's something familiar about this company.

    They offer a sleek product that virtually everybody agrees is technically superior to everything else on the market. They're ignoring the broader market and focusing strictly on appealing to the high-end user. They're led by a cult-like figure (who even has a movie action hero modeled after him) and have cult-like fans. I'm not expecting that their future will play out the same as a certain company named after a fruit that I'm thinking of...but I suppose that's what their investors are hoping for.

  • Report this Comment On June 29, 2010, at 4:40 PM, speedytjb wrote:

    Clearly you nay sayers have not spent enough time learning about the product you are busy bashing. Take a simple visit to the tesla website and you will discover the model "S" to be both a work of art and a mechanical marvel that is miles ahead of the competition, large and small. It trumps the vast majority of all standard and electric vehicles, both current and proposed, in looks, performance, technology features, passenger capacity and driving range. To compare it to the offerings of Ford and Nissan is like comparing a Porsche 911 to a VW Beetle. Yes they are both German, but one is clearly a higher quality product that the general public will be more than happy to pay more for. This company will have no problem selling 20,000 cars a year. In fact, I would be surprised if there isn't a waiting listed nearly that long by the time they are ready for production.

  • Report this Comment On June 29, 2010, at 5:20 PM, Milligram46 wrote:

    The deal between Toyota and Tesla is very clear. No joint production until after Tesla develops its third generation platform. That isn't the Roadster, or the Tesla S, its the car after it.

    Ironically, as Toyota is very behind on ICE and pure electric development, they need the help from Tesla more than Tesla needs the help from Toyota (outside of the NUMMI plant).

    I'm with others who view this as a boondoggle financially, at best. If the Tesla S sees the light of day and is built, at production level quality and quantity, and on time I'll be stunned.

    The $58,000 base price (before government hand outs) does not get the 300 mile range, maybe 140 to 160, and the car is a bit, stripped. Tesla has said a loaded S model with 300 mile range will come in aroiund $87,000! From a car company with no experience building their own cars.

    Look, if I had $87,000 to burn on a depreciating asset and I wanted the mojo of a luxury brand AND the economy of an all electric, for $67,000 I can buy a brand new, proven, Porsche Cayenne hybrid.

    http://www.porsche.com/usa/models/cayenne/cayenne-s-hybrid/

    * Seats 5 - check

    * Pure electric - check - 40 miles at speeds up to 97 MPH

    * Enough range to get me to work and back - check?

    * Carry my cargo in a useful SUV body - why yes it does that too!

    * Can go past its 40 mile electric range on gas when I need to go further - why yes it does that too.

    * Free service - why yes, I get that also

    * Best in class quality - why yes, I get that too, provien

    * Save $21,000 and still get a tax credit (abliet a smaller one) - yes and yes

    * Performance - 0 to 60 in six seconds, top speed of 150 MPH, and 380 HP - check, check and check

    So what is the value proposition of a Tesla Roadster again???

  • Report this Comment On June 29, 2010, at 5:23 PM, 7footmoose wrote:

    This is a fanciful story without a storybook ending. Tesla will be acquired for it's technology in a take under or will fail within three years from lack of sufficient revenues.

  • Report this Comment On June 29, 2010, at 5:34 PM, TMFMarlowe wrote:

    @7footmoose: What technology?

    @speedytjb: What about the Model S makes it a "mechanical marvel"? As far as I can tell it's all off-the-shelf stuff -- *dated* off-the-shelf stuff -- in a pretty shell. Sure it's all pretty and jewel-like, but so are the new Buicks. So what? And don't bet too heavily on that "higher quality" line before they, y'know, actually build a few. Mass-producing cars might be harder than it looks.

    Thanks for reading.

    John Rosevear

  • Report this Comment On June 29, 2010, at 5:42 PM, TMFMarlowe wrote:

    @DevinLM: But the Model S won't be "technically superior to everything else on the market" when it arrives... in fact, it'll be rather dated unless they redesign some things between now and then. Unless they're keeping it really, really secret, Tesla has no disruptive technology. What technology they do have is about to be eclipsed in a big way. You think their R&D can keep pace with Ford's or Nissan's or GM's? I don't.

    Thanks for reading.

    John Rosevear

  • Report this Comment On June 29, 2010, at 5:46 PM, Turfscape wrote:

    speedytjb wrote:

    "Take a simple visit to the tesla website and you will discover the model "S" to be both a work of art and a mechanical marvel that is miles ahead of the competition, large and small."

    You'll also discover the model "S" to be a prototype. They have not yet determined manufacturing...that's kind of a big deal when you're trying to make and sell a significant number of vehicles.

    speedytjb wrote:

    "but one is clearly a higher quality product that the general public will be more than happy to pay more for."

    And where is the evidence for 20,000 people willing to happily over pay for an electric sedan?

  • Report this Comment On June 29, 2010, at 6:49 PM, plange01 wrote:

    ipo to bankrupt and closed in less than 6 months.a luxury car company going public in a depression.tesla will at least make the list of worse corporate decisions in history..right up there with also bankrupt hertz renting shelby mustangs in its famous rent to race program!!!not many cars survived!!

  • Report this Comment On June 30, 2010, at 10:12 AM, speedytjb wrote:

    John,

    I appreciate your personal response to your commentors. What about the car's technology do you feel is dated though? Is it the fact that it offers mutiport wifi simulaneously to all of its occupants, the 17" touch screen control console that responds to voice commands or is there something else that I am missing?

    @ TMFMarlowe,

    What makes it a modern marvel is the fact that it can hold 7 passengers, hit 60 mph in 5 seconds and also be capable of a 300 mile range while having virtually no operating cost. Yes, the Porsche hybrid is an amazing machine in its own right, but in the end it will still require shelling a decent amount of coin for fuel and it will more than likely carry uber high maintenance costs to keep it alive because it still relies on lots of moving wearable parts. As a high performance car owner that just had the pleasure of replacing his turbos I am fully aware of the operating costs associated with owning a combustion engine vehicle that does 0-60 in under 5 seconds. $50 fill ups of 93 octane every 150-200 miles (@$2.87 a gallon) are part of the routine as well as rediculous maintenance costs on a regular basis. With an electric motor and single speed transmission wear and tear is going to be greatly minimized which means much less shop time at $100-$120 an hour. With the power source costing $4 instead of $50 per fill up, the battery replacement cost becomes neglible by the time it needs to be changed as well. On top of all of that, it looks like a Maserati or Porsche Panamera, so it has the cool factor that is very hard to get out of a vehicle that is also practical.

    The "S" is not a prototype, yes I am sure sure some of the software may be enhanced to accommodate evolving technology (ie introduction of 4G networks etc), but I'm pretty sure the fundamentals of the design are in place since they are in the process of designing the configuration of the assembly plant machinery and are taking reservations on their website...things you would only do if you knew what you were going to build.

  • Report this Comment On June 30, 2010, at 10:34 AM, TMFMarlowe wrote:

    @speedytjb: Don't get too excited about infotainment systems until you see what other manufacturers (like Ford) will have available by the time the Model S hits the market -- at much lower price points.

    What's dated: The driveline technology is a modest evolution of a solution that's almost 10 years old. More modern approaches will be on the market before the Model S hits dealers.

    And you're right, the Model S isn't a "prototype". It's not yet developed to the point where we can call it a "prototype". Anyone can take orders, but without serious, expensive development it's much harder to build a car that will meet global mass-market expectations of quality -- especially in the $50k+ price bracket. That development hasn't happened yet. Right now, it's just a concept.

    John Rosevear

  • Report this Comment On June 30, 2010, at 11:15 AM, AZBrewer wrote:

    This article is grounded in very little fact. To date Tesla's technology is the MOST advanced in the electric auto industry ... PERIOD! The article does point out, rightly so, that it is certainly an uphill battle for any upstart automaker. This will be no different for Tesla. However, the author fails to recognize that Tesla is not going for the toyota corolla crowd, but he Mercedes and BMW crowd. And they will resonate quite well with those folks. Tesla also has some very strategic partnerships with Toyota and Daimler, that should benefit Tesla and produce revenue in the near future.

  • Report this Comment On June 30, 2010, at 12:13 PM, TMFMarlowe wrote:

    AZBrewer says: "To date Tesla's technology is the MOST advanced in the electric auto industry ... PERIOD!"

    To the extent that that's true, it won't be once the Model S gets to market. In fact, I'd say you've got about six more months to say that with anything resembling a straight face.

    But hey, enjoy it what you can.

    John Rosevear

    ps: The author drove BMWs from 1998 until recently (when he finally burned out on BMW's maintenance costs and bought a Cadillac instead). You might say that he's somewhat familiar with the luxury car markets, and his sense is that BMW drivers are just as unlikely to take a leap on an unproven automaker -- and Tesla IS an unproven automaker at this point -- as everyone else.

  • Report this Comment On June 30, 2010, at 9:24 PM, h2carblog wrote:

    John,

    How can you write for Motley Fool and know so little about what is happening with hydrogen fuel cell vehicles?

    You made this comment:

    "As things look now, electric cars are (probably) the future of the automobile. After a couple of decades of dithering around with fuel cells..."

    Are you aware that last September eight car companies signed a letter of understanding saying the hydrogen fuel cell vehicles would be commercialized in 2015 and asking for the initial hydrogen fueling stations to be built by that time?

    (See #8 in the link at the bottom)

    And here is an article that I wrote titled "7 reasons to love Toyota hydrogen fuel cell vehicles":

    Here are 7 reasons to love Toyota hydrogen fuel cell vehicles (which the company started developing in-house back in 1992 when I was a senior in high school):

    1. 431-mile real-world driving range with Toyota FCHV-adv (mid-size SUV) hydrogen fuel cell vehicle (See the following YouTube video)

    2. 68.3 real-world miles per kilogram fuel economy with Toyota FCHV-adv (See the following YouTube video)

    3. Ability to operate in temperatures as low as minus 35 degrees Fahrenheit (minus 37 degrees Celsius)

    4. Irv Miller, TMS group vice president, environmental and public affairs, made the following comment on August 6th:

    “In 2015, our plan is to bring to market a reliable and durable fuel cell vehicle with exceptional fuel economy and zero emissions, at an affordable price.”

    5. Masatami Takimoto, a Toyota executive vice president and board member, made the following comment about hydrogen fuel cell vehicles in January 2009 at the North American International Auto Show:

    “By 2015, we will have a full-fledged commercialization effort.”

    6. The Toyota FCHV-adv (Highlander) hydrogen fuel cell vehicle has the same trunk and passenger space as the gasoline-powered version.

    Click on the following link to see a picture of the trunk in the Toyota FCHV-adv hydrogen fuel cell vehicle.

    7. Here is a comment made by Justin Ward, advanced powertrain program manager-Toyota Technical Center, in a Ward’s Automotive article (subscription required) that was published on July 16th:

    “We have some confidence the vehicle released around 2015 is going to have costs that are going to be shocking for most of the people in the industry. They are going to be very surprised we were able to achieve such an impressive cost reduction.”

    (See #1 in the link at the bottom)

    Greg Blencoe

    Chief Executive Officer

    Hydrogen Discoveries, Inc.

    Publisher, Hydrogen Car Revolution blog

    http://www.h2carblog.com

  • Report this Comment On June 30, 2010, at 11:24 PM, ozzfan1317 wrote:

    I wish the stock had options I would buy a whole pile of puts. :)

  • Report this Comment On July 01, 2010, at 7:22 AM, TMFMarlowe wrote:

    @h2carblog: I know more than you think. For instance, I am aware that the hydrogen-selling lobby and interested parties like yourself would LIKE fuel cells to be the wave of the future, and that TM and a couple of other OEMs are keeping development efforts alive. But I also know where the real R&D dollars are being spent in the industry right now today, and it isn't on H2... it's on batteries.

    Maybe 5-7 years from now the battery/range problems will prove insurmountable and H2 will start to get commercialized in more than a novelty way (which is how I would characterize TM's efforts). But I wouldn't bet actual money on it. Not yet.

    John Rosevear

  • Report this Comment On July 01, 2010, at 12:13 PM, h2carblog wrote:

    John,

    FYI...

    Top 20 quotes from Toyota and Honda executives criticizing plug-in battery cars (and one from Hyundai)

    http://www.h2carblog.com/?p=1357

    Greg Blencoe

    Chief Executive Officer

    Hydrogen Discoveries, Inc.

    Publisher, Hydrogen Car Revolution blog

  • Report this Comment On July 02, 2010, at 12:11 AM, Linh27 wrote:

    As much as I like the MF, also note that they did come out with a similar article about Google when the IPO came out and what happened?

    Article came out when Google was $100 and it went to $500.

    Sure electic cars have a lot of limitation but talk is cheap all the major car company ever is concerned about is profit and as long as they have profit they don't care.

    They only cared when gas prices went up and people stop purchasing big trucks.

    I do hope Tesla does well and create an affordable electric car.

  • Report this Comment On July 02, 2010, at 12:32 AM, NOTvuffett wrote:

    I refuse to carry jumper cables to rescue these drivers of all electric vehicles, lol.

  • Report this Comment On July 02, 2010, at 5:10 PM, jkeedy wrote:

    Having owned two Porches over the last 16 years, my husband and I were loathe to think about driving anything else, until Tesla introduced its roadster. And when it announced its sedan, I got more excited. I had to wonder what was going on with Porsche (now owned by VW). (A Cayenne is an SUV. Even its hybrid model sucks gasoline at less than 15 mpg while our Porsche sports cars easily get 25 mpg on the highway.)

    There is a market for high-end electric cars. I'm part of that market. As much as I love the idea of electric cars, I wouldn't walk onto the car lot selling GM or Ford products, but I would venture to see and maybe buy a Tesla. I'm sure among our 300 million citizenry, there are 20,000 people, even in a 'depression', that would buy their sedan.

    I just wish it was here sooner.

  • Report this Comment On July 02, 2010, at 5:35 PM, ragedmaximus wrote:

    ok, tesla stock going to 5 bucks ok that's out of the way. roadster overpriced. tesla s car sexy and I want one,can i afford it no not now after job loss and ira raid i'm down a ton but not out in a few years I'll be back to normal. I loath getting gas for my harley roadking which gets about 50 miles to the gallon,it's the only vehicle I have left.I junked my 98 jeep cherokee .it was falling apart literally and i didnt abuse it. the brakes were going needed tires normal stuff the ac was broken and needed a whole new system 1500 bucks a common big problem ,especially in florida 100 days lots of them on and on it got 14mpg terrible.I got sick of crappy gas mileage no ac and it wasn't worth putting another dime in it. I like the tesla s model one day i might own one cause it's sexy and it's electric like the song that blares on all cruise ships in the carribean lol and one day the silver tesla s will be mine and no more stupid gas stations where all the other aholes are fueling up .

  • Report this Comment On July 05, 2010, at 11:09 AM, azmfool wrote:

    I'm kind of late to this party, but I see a lot of passionate argument here, and there be the dragons. I'd like to caution against falling in love with an idea. The first thing I thought of in reading the comments was the rabid allegiance people had to PE Celera. You guys might not remember that one, but a lot of us got schooled on unkept promises.

    You need to be a little more clinical and ask yourself what people will actually buy. Car manufactureres have known, or should have known, for years that what consumers 'say' they will buy at an auto show vs. what they actually 'will' but off the dealer floor are rarely the same thing.

    One other thing - the Fool is right to question the wisdom of jumping on any IPO, whether it's Google, Tesla, whatever. If you're being honest, for every winner you could probably name 20 losers, and frankly I doubt your Magic 8 Ball is that good.

  • Report this Comment On July 06, 2010, at 9:11 PM, mythshakr wrote:

    In the discussion between hydrogen and electric vehicles the question is, which energy source technology will become cost effective first and what kind of a moat can it build when it gets there. A couple of years ago I thought it was a tossup. But today, with the potential of the lithium-air and zinc-air technologies, batteries have gained an edge. And I could really care less what a bunch of automobile executives trying to convince everyone they're doing amazing things have to say. All show and no go.

    Disregarding all the bells and whistles whoha Tesla's claim to fame is its high power to weight ratio 240KW induction motor and it's control system and I've not seen anything comparable out there other than advertise gonna have speak.

    Today, Tesla is the only manufacturer of an all electric publicly available car. They are the only ones learning real world lessons from owners. They have already had to make significant changes to the Roadster and the battery capabilities are still less than advertised for real world users. They have already had to delay the availability of the S to 2012 so their learning curve is still steep. It's a risky investment, of that there is no doubt.

    GM's Volt is years behind and still vaporware. It might have made a great competitor in 2006 to the Prius but today is just another hybrid but with a gimmick. And, made by a company that I have yet to see a Fool analyst think is actually on the road to long term profitability?! From where I sit I see another EV1 fiasco brewing.

  • Report this Comment On July 16, 2010, at 5:51 PM, steven107 wrote:

    "...Even tech giants like Microsoft (Nasdaq: MSFT) have waded in; Mister Softy is working with Ford on systems to manage recharging of the automaker's upcoming electric models."

    I personally consider having Microsoft Software controlling any aspect of a car, even if it is just voice controlled radio or heat/ac or other peripheral a negative selling point; moreso the more deeply embedded it becomes into the main systems.

    Once Microsoft offers a version of CE to run your cars ECU, would you feel comfortable taking that car past 30mph?

  • Report this Comment On July 23, 2010, at 5:46 PM, urada wrote:

    Is there a market? If they deliver, yes. I was looking to purchase a car this year and looked at the Volt, the Leaf, the Prius. Their electric ranges are too short. I'd still be buying gas and paying for maintenance on a gas engine (except for the Leaf). So my vehicle purchase has been postponed until 2012 for a Model S, and yes I'm willing to pay more. All considered the base Model S isn't really going to be that much more than the Volt and it'll have quadruple the electric range and no gas engine maintenance.

    One can't criticize this company both for being inexperienced/unproven and for using old school technology from their roadster. Yes, they'll have to scale up production, but the roadster gave Tesla a lot of real world experience that cannot be dismissed. The Model S is a logical next step and relative to the 110k roadster is a move toward a larger market. If they were proposing a $30k car everyone would be screaming that there's no way they can produce enough at that price point and they'd be right. 50-80k is a logical next product, followed by cheaper models. And what about that? Investors should consider carefully the relationship with Toyota and work on the Tesla powered RAV 4, which is alreay underway.

    No doubt Tesla has a long and bumpy road ahead, but it's not at all inconceivable that they could succeed.

  • Report this Comment On September 21, 2010, at 12:52 PM, willpower101 wrote:

    Did people forget that Elon Musk built an effing spaceship? If Nasa things he's capable of handing a 1.5 billion dollar contract to deliver cargo to the space station I REAAALLLY think he's capable of competing in the YET UNDEVELOPED electric car industry. sheesh.

  • Report this Comment On September 21, 2010, at 12:52 PM, willpower101 wrote:

    thinks*

  • Report this Comment On September 29, 2010, at 10:34 AM, TMFMarlowe wrote:

    @willpower101: If his spaceship contract had won on both quality and price in an open head-to-head competition against 8 or 9 vastly larger, vastly more experienced, vastly better-funded global spaceship-making companies, I'd be more inclined to buy your argument. Because that's what's going on here. The electric car industry may be "undeveloped", but the car industry sure isn't... and the amounts being committed to its development by far more experienced major global players dwarf TSLA's budget.

    Really, my whole caveat about TSLA comes down to this: Building competitive cars -- electric or otherwise -- at a competitive price is a lot harder than it looks. I think Musk -- and the Silicon Valley pundits and investors pushing this thing -- have grossly, wildly, almost laughably underestimated the competition, and I think that will be an enormous problem for them.

    John Rosevear

  • Report this Comment On October 03, 2010, at 11:15 PM, fly4vino wrote:

    If anything, I think the article downplays the problems facing Tesla and some of their decisions.

    In addition to all of the listed challenges, Tesla's decision to buy the old Fremont GM plant puts them in a very high cost labor market and competing with high tech companies for employees. CA is not a very business friendly state although the Tesla initial investors have enough contacts to make most of the problems disappear. If you are having problems understanding CA labor costs, note that Whitman was paying her maid $23 per hour.

    Tesla also lost a sever key employees in an aircraft crash a year or two ago. Likely that the settlements will be very substantial. Tesla employee was flying subordinates.

    There are other examples of high tech people setting out to revolutionize industries. Eclipse Aircraft promised a revolution in the Very Light Jet market but ended up in bankruptcy and liquidation. As Eastwood noted , "A man's got to know his limitations."

    If they were loosing money at $100,000 per unit for the roadster I am not sure how they are going to make money at $60,000 for the sedan. Yes I know that Lotus was building the roadster but that should have been an advantage.

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