Tesla still alive and kickin'
Tesla Motors and it's man in charge, Elon Musk, have had to make some tough decisions these past few weeks. The announcements made by Musk indicate that cash is getting tight, leading some to speculate that the company won't be in business much longer. Not so, says Tesla. Musk has reportedly personally guaranteed that the fledgling automaker would deliver all Roadsters to customers that have placed deposits, saying, "I have the means and wherewithal to do so. So people should have absolutely zero concern about their deposit." While the Roadster's production is moving forward as planned, the automaker's Model S sedan has been delayed by at least six months.
Tesla Motors has also just announced that it is close to closing on its latest round of funding to the tune of at least $20 million. As of right now, Musk suggests that the automaker currently has about $9 million in funds with which to operate, a figure that some point to when suggesting that Tesla's on the financial ropes. Musk discounts those rumors, saying that $9 mil is plenty for now and that more funds will be coming from past company backers in the very near future. Of course, we'll be watching the situation closely, but it appears that rumors of the company's death are more than a bit premature.
[Source: Tesla Motors, Reuters]
Reader Comments (Page 1 of 1)
Mike Z 1:46PM (10/31/2008)
250 employees
a 155,000 sq ft facility.
They will likely burn through $9 million in 4 months on payroll and facilities alone.
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TX CHL Instructor 2:14PM (10/31/2008)
That's assuming zero income, so I suspect that's unduly pessimistic. I'm not (yet) a big Tesla fan, but I might become one if/when they actually produce something I can afford. I'll be happy to just see them successful enough to attract lots of competition.
cheleball 4:42PM (10/31/2008)
Anyone who followed the launch of the Roadster would be hard-pressed to believe the Model S would be released when they said it would. That's not really the biggest cause for concern. What I would be more worried about is that apparently, sales of the Roadster have not been sufficient to pay for the company's continued operation; how likely is it that they'll be able to turn a profit before the VC's get tired of giving them money?
Remember the whole point of entering the market at the tippy-top is to use the higher profits afforded by the high-end segment to drive downmarket. If the Roadster never becomes profitable, then yeah, I'd be a little worried.
I really really want Tesla to succeed, but it looks like their tough times are only beginning.
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jake 6:17PM (10/31/2008)
With the kind of streamlining and cuts they have recently made, they will be able to reach profitability in around 9 months as Elon says. Remember the 1200 are not actually sales, they are preorders of $4k-$60k. This means they haven't actually gotten all the money from customers yet. That is drastically different from the situation that you have described in which the customers have all paid in full.
gorr 7:03PM (10/31/2008)
Well , what is happening with car compagnies??? No car compagnies seem to make money these days. Gm, ford , chrysler and europeans too. It's because people are deceived of actual car technology, mainly old fart gasoline and even diesel ice engine. As of tesla, i think that they lack engeeneiring skill, vision and organisation and the market for electric battery car is just theoric and in a few months or a year or two , everybody will forget about batteries except for the flaslight or smoke detector.
Maybe we will never see a innocent customer buying a battery car and doing his things with it and without making a political statement with it.
Manufacturers have been rob by everybody. Rob by petrol industry with sudden and uncontroled price hack. Rob by goverment that insist of changing all car specs (security, emission, consumption, tax credits, energy policy, flexfuel, no hydrogen infrastructure) each week on each different territory. Rob by incompetant scientists and engineers that promise breakthrout discoveries and endup saying that for saving gas you have to stay home or walk. Rob by high financial banks that succeeded in part of ruling car distribution network where each car is paid continously by unnaware of anything consumers that have to pay the car twice with illegal renting contract and financing policy.
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Chris M 2:29AM (11/01/2008)
Gorr: Tesla Motors engineering skill, vision, and organization is a heck of a lot better than your spelling, grammar, and logic.
Their cars are not just "theory", they are fully functional and Tesla has already delivered several to customers, and will have delivered several hundred by the end of the year. Production is ramping up, and they should clear their 1,500 pre-order backlog within a year.
stas peterson 4:13PM (11/03/2008)
Like Tucker before it, Tesla devotes extraordinary amounts of time to PR hype. There is not much original engineering with either, except for some very crude and primitive ideas, not fully worked out..
Like Tucker it will be a footnote in history...
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Don 9:08PM (11/02/2008)
Musk is saying what anybody in charge would; it's all to assuage buyers and investors.
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