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Tesla Motors: America’s Fourth Automaker?


2011 Tesla Roadster Sport. Photo by Joe Nuxoll.

2011 Tesla Roadster Sport. Photo by Joe Nuxoll.

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Is the new kid on the block, Tesla Motors, poised to join the Big Three automakers as a major player in the car manufacturer industry in North America? Morgan Stanley thinks so. In fact, a new report by Morgan Stanley describes the Silicon Valley start-up as potentially “America’s fourth automaker.” The result: Tesla’s stock shot up 20-percent to over $28 a share on Friday.

In their report, Morgan Stanley went on to say that rising gas prices and the promise of government support for alternative fuel vehicles could be the building blocks to push the electric vehicle manufacturer to global success.

A Revolutionary Car Design

Tesla Motors was founded in 2003 by a group of Silicon Valley engineers whose vision was to develop affordable electric vehicles. Today the company is based in Palo Alto, CA; it has 800 employees and 17 stores worldwide that market the Tesla Roadster and the luxury Model S sedan. Neither one will ever be a hybrid vehicle. Tesla’s mission is to design and manufacture only electric drivetrain vehicles.

The Roadster is a high-end, 2-door sports car. It can accelerate from 0 to 60 in less than four seconds and has a range of 245 miles on a single charge. The base price is $109,000. There are 1500 Roadsters in 30 countries around the world. Tesla recently announced that these Roadsters have now covered 10 million real-world miles and have collectively saved half a million gallons of fuel and over 5.3 million pounds of carbon dioxide emissions.

The Model S will not be mass produced and available to the public for another year. Tesla says this full-size sedan will seat 7, accelerate from 0 to 60 in less than six seconds, and have a base price of $57,400. The Model S will have a range of 160 miles with optional battery packs that can extend that range to 300 miles. Four thousand Tesla enthusiasts have plunked down $5,000 each to reserve a Model S for delivery once Tesla begins full production next year.

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Comments (8)
  1. Elon Muck of Tesla seems to be the only one in the auto business with any sense when it comes to electrics. He realizes that the price of batteries necessitates building EVs at teh upper price ranges, where EVs can compete economcally. That's what he's done with his Model S, which has better performance (and MUCH better looks) than the high end BMW 5 series.
    With 300 miles of driving range and a mere 45 minute Level 3 recharge time, the Model S can easily
    do trips, a first for electric cars. And its space and operating cost efficiencies are miles ahead of its competitors from BMW, Mercedes, Cadillac and Audi. For the fist time in history an electric is effortlessly besting the best of the gas powered vehicles out there, in every respect. I wonder how long before the gas powered auto mags realize this simple truth? Some never will.
     
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  2. ^ This post is so obviously a plug for Tesla. Their cars blow, are overpriced, and in most respects are much worse for the environment then many fuel efficient internal combustion engine cars. Auto mags realize the truth, that Tesla lost 154 MILLION dollars in 2010 and they have no future.
     
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  3. Tesla still exists, and they are thriving. As far as the car itself, it has been awarded top honors by numerous agencies. The Tesla is nowhere near overpriced like a Maserati Quattroporte is. Your environmental argument has been debunked in detail many times so I'm no going to repeat it.
     
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  4. Eric,
    In what respect are they worse for the environment, are overpriced, and in your choice of words 'blow'. They cycle energy of the grid at a fraction the pollution, have better acceleration, are comparable in range, and are priced well with in the high end market.
     
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  5. Very well said Dee, and as Kent said some never will never get the SIMPLE truth. Of course they lost millions in 2010, they are bringing a breakthrough product through expensive R&D and hopefully to mass market. The fact they only "lost" that amount in my humble opinion is remarkable. Sadly the world is full of cynical people, some willing innovation and progress for the common good to fail.
     
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  6. When gasoline hits 10 to 15 dollars a gallon, Eric will be the first on line to buy a Tesla third generation priced at 30K. Don't be fooled, the buckets of oil around the world will eventually run out and we won't have much of a choice but to go electric. Any way you look at it, it will be the future, like it or not!
     
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  7. Actually, electric cars make sense when you research hydrogen cars, which are essentially electric motors powered by hydrogen. I think Tesla will eventually have to go this route since battery tech is limited and the elements to build any battery are VERY finite.
     
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  8. In support of Eric. In the reality of today and the next 20 -30 years the Tesla would best be classified a Pollution Transfer Vehicle, since the emissions to move the car are conveninently (at least in California) emitted someplace downwind like a Nevada coal burning plant. So it is not cleaner by virtue of using battery power, and power density / kg still favors ICE's.
    The path to the future maybe electric, and GM's adaption of railroad engine technology to cars in the Volt is likely to be favored by normal 1 - 2 car families, since there is no range limitation on operating the vehicle.
    Yes Tesla is saavy / wise to focus on the very wealthy in their business case, but I think Morgan Stanley is just pumping this stock to create short term pay-offs for the current shareholders.
     
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