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Is Tesla Running out of Juice?

October 15th, 2008 | Posted in: Competitors, General

Tesla motors of course is the silicon Valley startup that has begun low volume production of the Roadster, a $100,000 2-seater pure electric car with over 200 miles of range. Despite the car being so expensive, the company had plans to build a more reasonably priced $60,000 sedan called the Model S in 2010.

The company has had a long and turbulent start-up process funded by PayPal pioneer Elon Musk.

Tesla is credited by GM vice-chairman Bob Lutz as being the inspiration to build the Volt electric car. Lutz has said “if Tesla can do it, why cant we (GM)?”

It now appears that the financial crisis and lack of available credit may be spelling trouble for Tesla too.

Reportedly the company is having to lay off 100 employees and their second CEO Ze’ev Drori who has been there less than 1 year, is now stepping down to be replaced by Elon Musk himself.

Musk in his blog post indicated that Tesla has to focus on cash flow and is “going to reduce activity on detailed production engineering, tooling and commitments to suppliers” for the Model S although denies the vehicle is being completely scrapped but delayed to mid-2011.

The company will also be shutting down its Michigan facility.

Thus far Tesla has only delivered 50 of its Roadsters with an R&D expenditure so far over $150 million.

Source (Tesla) and (Autocar)

Popularity: 2%

(5 votes, average: 4.8 out of 5)

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Posted by: Lyle

86 Responses to “Is Tesla Running out of Juice?”

Dean Jones Says:
October 15th, 2008 at 6:26 pm

Let’s hope GM can stay in business long enough.
Holgar Says:
October 15th, 2008 at 6:34 pm

Ja! Zweite!
kubel Says:
October 15th, 2008 at 6:40 pm

I wouldn’t be worried. Tesla has California, and GM has the United States. Both will go down, and both will be bailed out.
vincent Says:
October 15th, 2008 at 6:42 pm

Did you guys know this is the guy that created Pay Pal.
He has lots of money.
Gary Says:
October 15th, 2008 at 6:43 pm

Tesla has had a lot of development hurdles to jump–this being the latest.

Slap an electric motor in a car with a bunch of batteries? Apparently, it’s harder to build an electric car than what many people think.
Dave B Says:
October 15th, 2008 at 6:43 pm

Terrible news…I hate to say it, but we need gas to spike again to $150/barrel.

On another VERY interesting note, BYD has announced it’s Volt-like 62-mile E-Rev will be on sale by the end of this year and can quick-charge halfway in 10 minutes. That’s big.

http://www.autobloggreen.com/2008/10/15/byd-hybrids-on-sale-earlier-than-expected/
Gary Goggin Says:
October 15th, 2008 at 6:45 pm

Tesla helped reinvigorate interest in the electric car and helped prompt the major auto manufacturer’s to commit billions to an electric car future.It would be a really bad omen to see them go under! I hope they can steer their way through the current financial difficulties.(pardon the pun)
Nixon Says:
October 15th, 2008 at 7:02 pm

“Thus far Tesla has only delivered 50 of its Roadsters with an R&D expenditure so far over $150 million.”

That means Tesla has 1,450 more Roadsters to go to just cover the R&D expenditures (if these numbers are accurate). Doesn’t sound too bad at first, since they already have large deposits down on somewhere near that number of 2008 and 2009 models. But I’m guessing that the R&D number doesn’t cover production costs, and marketing expenses, etc.

It would be interesting to see the full math on the company.
kent beuchert Says:
October 15th, 2008 at 7:02 pm

Isn’t it strange that Tesla can make onme blunder after another, yet the media still talks about the company as though it will ever amount to anything. The numbers of cars they are looking at means that this car’s influence on emissions or gas consumption is lower than low : it will be completely nonexistent. This is a goodexample of how the media can play a story any way they wish. Tesla should be the butt of jokes by evey comedian worth his salt. Tesla CEO as a “dead man walking” position, etc. False logic has simply pervaded this company’s actions from the very beginning. Only for a short while did they seem to understand the advantage of serial technolgy.
Then, probably because they suddenly realized it was beyond their capabilities, they started bad mouthing same. Tesla and its PayPal
owner should simply fade away.
Curtis Says:
October 15th, 2008 at 7:05 pm

@6

Yeah, but have you seen the crash test videos of BYD cars? Pretty scarey stuff, lol. Although, how are their batteries so different than the Volt’s?
J Man Says:
October 15th, 2008 at 7:09 pm

Hate to see it happen. I think a lot of companies are have more $$$$ problems then we think. Hopefully they can take advantage of that $25 billion once the EPA gets their act together to set the criteria for lending the money for the auto makers.
Kent Says:
October 15th, 2008 at 7:15 pm

I wonder how this will affect their plans on the manufacturing facility to be built in North San Jose. Also, what will become of their two showrooms that just opened a few months ago. I’m a little sad to here of this. I was really hoping Tesla would succeed even though the odds were against them. I have to admit I’m a little biased towards Tesla since I live in the Bay Area.
Nixon Says:
October 15th, 2008 at 7:17 pm

In a partial answer to my own question, Elon isn’t publishing all the numbers, but he’s saying that they have a plan to make Tesla a positive-cash flow company within 6-9 months. That’s not bad really. I don’t see Lutz talking about making GM into a positive-cash flow company in 6-9 months….

http://www.teslamotors.com/blog2/?p=65

If Elon is to be believed, Tesla has just been set back by 6-months. So not exactly “running out of juice”. More like stuck for a long time getting recharged. Again, GM has been known to blow deadlines by 6-months too.
Gary Goggin Says:
October 15th, 2008 at 7:35 pm

I’m not saying that Tesla was founded on Altruism alone but i do think that Musk intended on making a grand statement on sustainability and was willing to put his money where his mouth is. As far as i’m concerned and given the recent roller coaster ride in oil prices, the motivation for Tesla’s founding was based on sound economic logic. If for some reason it doesn’t work out! the world will have a more cynical view on alternative transportation and even a huge company like GM will suffer from the inevitable media scrutiny.The world stock markets are so nervous and insecure right now, it would not take much for GM’S electric dreams to be put on hold indefinitely. The Tesla Roadster helps validate the Volt!
J Man Says:
October 15th, 2008 at 7:52 pm

I think GM would put other items on hold before the Volt. Just my opinion though.
statik Says:
October 15th, 2008 at 8:05 pm

So let me get this straight.

This company, based out of the United States, is trying to manufacture automobiles and sell them for profit, but can’t seem to do it, so they are slashing payroll and shuttering plants?

Shocker.

Ironically enough, Nikola Tesla had a problem his whole life making money and staying out of debt, despite his brillance. The guy could have been the world’s richest man (and first billionaire), all he had to do was sign a piece of paper. Instead, he died in debt…alone in a shady hotel room. RumoUr is the guy couldn’t even balance his checkbook…no concept of money, or at the very least put no importance to it.

Alternating-current generator/Tesla Coil? Why bother patenting that, the world needs “free energy for all”, lol.

Famous quote, spoken to Edison: “How could I own alternating current? That’s like owning thunder or lightning. I can’t agree with that.” (easy to see why him and Edison didn’t get along).

/I guess he had ideals…and that is somthing
Bearclaw Says:
October 15th, 2008 at 8:27 pm

It’s too bad they are shutting down the Michigan facility. However, if GM and Chrysler don’t get together it would be interesting if GM took over Tesla. They could have the Roadster be their answer to the Dodge EV. Not that I could afford it but with the assembly line I bet they could bring it down to the cost of a Corvette.
drG Says:
October 15th, 2008 at 8:44 pm

Is this website a joke or something?

I think you better do a “Is GM running out of Juice” before worrying about other companies.

LOL!
canehdian Says:
October 15th, 2008 at 8:51 pm

#9 “Isn’t it strange that Tesla can make onme blunder after another, yet the media still talks about the company as though it will ever amount to anything.”

The difference between Tesla and GM?
Tesla is really small, it can only go up.
Gm is really big, it’s bound to go down.
Obviously tesla can go down too, but if they sell out $100,000 cars before they’re built, they’re bound to do okay
D Lo Says:
October 15th, 2008 at 9:02 pm

The Tesla Rochester Michigan facility is within electric commuting range to the Tech Center in Warren, Michigan. I hope GM hires those being laid off to join the Volt and E-REVolution. I guess my point is, Tesla’s loss could be GM’s gain.
Jeff Says:
October 15th, 2008 at 9:18 pm

#16 statik

Maybe GM should buy Telsa instead of Chrysler…and sell Hummer. The deals may not see a profit, but it would be great GREEN PR for GM.
GmsAJoke Says:
October 15th, 2008 at 9:25 pm

Sorry, Tesla is a great car for the ubber rich, but a waste of resources for those that don’t waste money. If it doesn’t have a range extender it is an expensive golf cart.
Blake Says:
October 15th, 2008 at 9:37 pm

Although small, Tesla is a very important company. They need to survive simply because they are trying to push automobiles in the right direction. Tesla isn’t about making money, we all know that Elon Musk knows how to make money a lot faster and easier in other buisinesses. Everyone is benefiting from what Tesla has started. When Tesla started, EV’s predominately used analog controllers but with their new powertrain, Tesla has shown that a well designed digital system can greatly improve performance and reliability. Tesla has also made great strides in battery management which the rest of the industry is being forced to do as well. I commend everything Tesla has done, we wouldn’t have near the EV buzz that we have now without them and you have to commend them for putting so much work into the Model S before they even were shipping the Roadster. A company that is more concerned about brining the cars of the future to the masses than immediate profits needs to survive, otherwise we are left with the stagnating automobile industry that we have today.
GmsAJoke Says:
October 15th, 2008 at 9:43 pm

If GM drops the Volt because oil drop to 40 per barrel then they are a bigger joke than i already think they are. People are sick of paying for gas at any cost. I don’t care if a gallon of gas goes back to .99 cents(The cheapest I have paid in my life). I don’t want to pay for it anymore than I absolutly have to. The Volt is it because people want what they are trying to offer, but they want it from a company they know. Advertising works. These one off companies will have a hard time reaching GM’s name recognition.

And for the electric companies, look out for solar because we are tired of paying for your monoply azzes too.
truthguy Says:
October 15th, 2008 at 9:52 pm

Most posters here have seen the 60 Minutes piece about the GM Volt and the Tesla. What come across to me is the arrogance of SOME people in Silicon Valley. Now I live in Silicon Valley so I know of what I speak. Starting a company like PayPal is certainly a great accomplishment as is starting a company like MicroSoft or Google. But building automobiles is a very different kettle of fish. A lot of the younger guys in the valley are software geeks and some of these guys whould have a problem changing a bicycle tire. It’s a whole different skill set between running a car company like GM, Ford, etc and running most of the high tech companies in Silicon Valley. Frankly running a car company is a lot harder. The problems the US Car Manufacturers are up against are very formidable and many of the folks in the Valley just don’t understand how difficult it is to operate in the Automobile environment. Look I hope Tesla makes it, but I think they are a little more humble now.
Dave G Says:
October 15th, 2008 at 9:53 pm

#23 Blake Says: “Although small, Tesla is a very important company. They need to survive simply because they are trying to push automobiles in the right direction.”
————————————————————————————–
Yes. Well said.
Blake Says:
October 15th, 2008 at 9:56 pm

#22 GmsAJoke

The Tesla Roadster is only a stepping stone in the company’s vision. The Roadster was the perfect entry in the market because it can compete and exceed the performance of other $100k sportscars. The roadster leads to the $60k Model S which will lead to the 3rd gen car which will hopefully be affordable to the masses. Tesla never expected to sell very many Roadsters, they have always been about finding a way to get EVs into the mass market.

While all the other car companies and are spending so much of their money to convince CARB that combined they cannot provide 25,000 EVs between 2012-2015, Tesla is actually implementing their plan to deliver at least this many cars themselves.

Although very few will be able to afford a Tesla over the next years, Tesla is still important to all of us because they are galvanizing interest, effecting policy, and proving false many claims that have been made by the auto industry.
butters Says:
October 15th, 2008 at 9:56 pm

There are only two things that ever prevent anything good from happening — money and politics — and they’re both lies.

Money is created from debt. We can have as much money as we want as long as the economy continues to grow exponentially to cover the interest.

But if we can’t grow exponentially because of, let’s say, finite natural resources, then the entire banking system defaults to the Fed and other central banks.

We don’t need to bail out the Fed, though, because they can conjure unlimited amounts of money into existence — and collect interest on it — with absolutely no risk besides being exposed as a fraudulent scam.

That’s why the taxpayers need to pay something, even if it’s only $700 billion. If the Fed used its magic money creation powers to replace the defaulting debt-money without anyone paying anything, then their only possible risk would be realized.

So why don’t we get over the fact that money is a lie, mathematically destined for unsustainability and worthlessness, and create our own money that serves the public interest in the facilitation of commerce and trade?

The next president should immediately announce a plan to pay down all public and private debts within two years by issuing interest-free Treasury bills that can only be loaned at full reserve.

For every dollar of Treasury notes injected into banks, one dollar of new loans will be made available, one dollar of existing debt will be retired, and one dollar of Federal Reserve notes will be removed from circulation.

This results in zero inflation, the retirement of all existing debts, a massive one-time stimulus of new loans to rehabilitate the economy, the complete replacement of the money supply with interest-free currency, the option of a sustainable zero-growth economy, and a banking system that only lends as much money as it has on deposit.

This is a Constitutional authority vested in Congress by Article I Section 8. We don’t need a gold standard. All we need is a growth standard: we can have as much money as our economy can produce.

It would be the end of easy credit, but at least it won’t be the end of freedom under the crushing yoke of inescapable debt slavery.

Tesla needs money, GM needs money, NanoSolar needs money, the green building design firm where I work needs money. Let’s reboot our economy and make it happen!
js1219 Says:
October 15th, 2008 at 10:01 pm

I hope they suceed. Once E-REVs pave the road for the electric infrastructure and lower battery costs, the electric car sales and viability will be much, much greater.

Hang in there Tesla!
Blake Says:
October 15th, 2008 at 10:15 pm

Its too bad that Tesla has to slow down a bit, but despite formidable problems that both SpaceX and Tesla have faced, Elon Musk has shown that he’s dedicated to moving both companies forward.
Texas Says:
October 15th, 2008 at 10:48 pm

Losing Tesla would be one of the greatest losses of this global economic meltdown. The price of oil is down to almost $70 a barrel and that is probably going to once again slow down the pace of development of alternatives. Truly sad because it’s the only thing that will matter in the long run. I wish them luck.
Dave K. Says:
October 15th, 2008 at 11:10 pm

Tesla is a good example of the risk/reward system we have in America. Tesla reached out on their own and decided to offer a $100,000 race track toy. The plan was to jam in as many small energy cells as possible. Things may still work out. I wish them luck.

I like the design of the Volt. Including the bow tie.

http://garfwod.250free.com/Photos/volt%2009-26%20033.jpg

=D~
ysf Says:
October 15th, 2008 at 11:34 pm

Tesla EV is fundamentally flawed due to their battery, they will NEVER be commercially successful due to the high cost of 18650 and complicated nature of handling 6800 cells, you can’t make a battery pack last long (even single cell may well does so), and it is dangerous.
I didn’t submit my resume to them 13 months ago because I know they are flawed, to be frank, I really love to see vehicles w/o oil, but it is extremely hard to be commercially viable (listen to this, Bob Lutz). Most people here know little about battery (I am testing battery every day) and overly zealous about EV. You guys can mark this prediction: In 2020, predominant mileage on the road is still from gasoline, a sad reality considering how important to use as little oil as possible. I know GM is not honest about the prospect of the Volt, and very likely to get hurt if things stumble, I personally think PHEV is still years (>4 years) away and HEV is more realistic, despite lower MPG (40-55 mpg).
With all those said, I still believe GM made the right decision to terminate EV 10 years ago. I sincerely hope their perilous situation will not push them to misleading PR stunts, instead, they should still invest diligently in hydrogen research and fuel cell, two areas I am not an expert (I am a battery scientist), but knowledgeable enough to know their importance.
Cautious Fan Says:
October 15th, 2008 at 11:47 pm

Ever heard of COMSPACE, Sphere Corporation , MOS Technology? Few people have. These companies were trailblazers in PC’s. They all went bust. But they had good ideas and you can’t kill good ideas in a free market. Other, better companies picked up their ideas and ran with them.

So if Tesla goes belly up, who cares? They get credit for starting a race but, like many trailblazing small companies, can’t finish it. I dont’ care if my PC says HP or MOS. It works great and is cheap. And if electric makes sense, 1 or 2 companies going down can’t change the fact. Other companies will pick up where they left off.
Texas Tea Says:
October 15th, 2008 at 11:57 pm

Black Gold is trading at $74/barrel, that’s down $4 in a day. Keep going down…puuuuuuh….leeeeez
I need my new 6.2L Camaro with TAP shifting really bad. The Camaro is my FUN car. The Volt is just my UTILITY car (back and forth to work only).
Mark Says:
October 16th, 2008 at 12:52 am

$60,000 for a car is *not* ‘affordable’ for the majority of the population.

People here may not even be able to afford the Volt, which might be priced at $40K. Good luck with $60K..
Marcus R. (WL #5275) Says:
October 16th, 2008 at 1:58 am

It wouldn’t be smart to bet against Elon Musk.
You may not like him (with good reason) but the man does good work.
This is just Tesla (over)reacting to market forces and shoring up dollars like everyone else in the Valley. Not that there isn’t plenty to be worried about, but the way Tesla is positioned I believe this action might do them more harm than good.
Still, my money’s on the jerk with all the good ideas.
Darius Says:
October 16th, 2008 at 2:11 am

ysf #33

You 1st paragraph quite reasonable. But in the end you have made comments witch cause outrages and cancels everything you said before. I have messed with fuel cells for some time. I am 100% confident - It will never be commercial mass product.
Ed M Says:
October 16th, 2008 at 2:38 am

Darius 38

witch cause or which cause ?

I know its getting close to Halloween and all but …
Ed M Says:
October 16th, 2008 at 2:40 am

Maybe there clients can’t get loans to buy the roadster or maybe Tesla has decided to wait for the new nanowired batteries.
real$$$ Says:
October 16th, 2008 at 3:30 am

Ed said it. He’s got an order book full for the roadster and he wants to grow the domestic business. They’ll have cash flow back in six months and then start back on the sedan. Meanwhile Fisker is in for a rougher ride - out of cash.
NZDavid Says:
October 16th, 2008 at 3:53 am

Credit is tight, it is natural that Tesla would slow down on their development plans. Unfortunately, in a fast moving field like EV, there is every chance they will be left behind and relegated to variants of the Roadster.
GmsAJoke Says:
October 16th, 2008 at 5:27 am

Blake don’t get me wrong I would love to have a tesla for free, but people that spend 100+ for a roadster like to do car club things. For instance I was driving thru a tourist town in NW Arkansas a couple weeks back and it had corvetts everywhere. I saw them coming up all the way from Texas. Same type as the Hog crews. They like to drive them to places, sometimes a bit futher than the batteries will go.

I saw a Tesla in Chicago area on the road. It was mixed in with other ICE roadsters. He ain’t gonna make it on longer trips unless he trailers it. Trailering is for rock crawling jeeps, not roadsters.

I stand by my tesla is an expensive golf cart. Without a range extender it is a garage queen. If they waste their money on a $60,000 car with no extender, they just built a cheaper overpriced golf cart.
NZDavid Says:
October 16th, 2008 at 5:36 am

2012 will be a good year for me. Only three people on the wait list from here last time I checked. woo hoo.

Holden has rolled out a bunch of initiatives including Chevrolet’s Volt extended-range electric vehicle that’s likely to be sold in Australia and New Zealand in 2012, two years after its launch in the US.

The Volt, which may take on the Holden badge, is permanently driven by electricity, but uses a small petrol engine to charge its lithium-ion batteries as they become depleted. Without this boost from the petrol engine, its range is just over 60km.

Alternatively, the Volt can be plugged into a standard 240-volt power outlet for a full recharge in less than three hours.

General Motors reckons the charging will cost less per year than running an average refrigerator.
http://www.nzherald.co.nz/motoring/news/article.cfm?c_id=9&objectid=10537272

/Sorry to hijack thread. EDIT to fix link.
Rashiid Amul Says:
October 16th, 2008 at 6:32 am

What a shame. I hope Tesla survives. I love the car and what it stands for.
I won’t ever own one, but then again, I won’t ever own a Lamborghini Countach either.
NZDavid Says:
October 16th, 2008 at 6:41 am

How about a EV Porshe, then, Rashiid?

http://www.topgear.com/uk/car-news/electric-911
Jim in PA Says:
October 16th, 2008 at 6:52 am

“…a more reasonably priced $60,000 sedan…”?!?! I thought I was at a website talking with fellow enthusiasts. But if $60,000 is considered by folks here to be a reasonable car price, then I just realized that I am the equivalent of the dishwasher at the country club.
BillR Says:
October 16th, 2008 at 6:54 am

These economic times will be tough on many companies. I’m sure Tesla will especially feel the pinch, as they are dependent upon funding to continue operations until they can start showing a profit.

I think the big lesson here, and this applies to some who post on this site: developing a new car takes time, experience, and hundreds of millions of dollars.

So for those who think we need the Volt to be first produced with lead acid batteries, or perhaps wonder what is taking GM so long, they should realize it is not a simple task to engineer and design the thousands of parts that go into an automobile assembly, line up suppliers and procure the major components, and then construct an automated assembly line for production.

Except possibly for the battery life, the Tesla roadster seems like a fine automibile, even though it is somewhat impractical and expensive. Obviously, Tesla has a niche market.

The problem that I see for Tesla is they just underestimated how difficult it truly is to bring an automobile to market.
Bearclaw Says:
October 16th, 2008 at 7:00 am

46. NZDavid Says:

How about a EV Porshe, then, Rashiid?

My father has an old 914. That would be a sweet car to convert to electric. maybe some day…
THOM Says:
October 16th, 2008 at 7:11 am

I thought tesla had a huge waiting list (just like the volt)!

THe only way to make money is to keep building while there is still demand.

Articles like this, on this webpage, are here so GM can announce they WILL NOT BUILD the volt because it is not profitable.
Rashiid Amul Says:
October 16th, 2008 at 7:21 am

NZDavid # 46.

I love that Porsche!
Rashiid Amul Says:
October 16th, 2008 at 7:23 am

Jim in PA #47 says,
“…a more reasonably priced $60,000 sedan…”?!?! I thought I was at a website talking with fellow enthusiasts. But if $60,000 is considered by folks here to be a reasonable car price, then I just realized that I am the equivalent of the dishwasher at the country club.
———–
Oh come on. You can’t afford only $60K for a car?

Just joking. I won’t pay that either.
Statik Says:
October 16th, 2008 at 7:30 am

Next gen Prius photos?
Current gen refresh photos?
Photochop?

Who knows, but here it is.

I actually posted this awhile ago, but forget that anything with ‘prius’ and ‘chat’ in a link gets destroyed….I see it on autoblog now.

http://www.autobloggreen.com/2008/10/15/breaking-possible-leakage-2010-toyota-prius/
Statik Says:
October 16th, 2008 at 7:31 am

Hot off the press this morning.

Autoweek also has a spiffy, differences between the Plug-In Prius and the Volt…more importantly the author has actually driven the Plig-In, lol.

Seems pretty fair and balanced…and a good read.

http://www.autoweek.com/apps/pbcs.dll/article?AID=/20081015/FREE/810109995/1024/GALLERYDETROIT
Sentinel Says:
October 16th, 2008 at 7:32 am

Let’s see… a very small startup car company, with a $100k two seater EV that few have ever driven and most can’t afford, a “reasonably” (ha!) priced $60,000 sedan that isn’t anything more than vaporware yet, no infrastructure to support the cars if they ever do get built. What could possibly go wrong???
Rashiid Amul Says:
October 16th, 2008 at 7:35 am

Statik, #53.

Is the plug on the front bumper? I can’t quit figure out what that square is there for.
Statik Says:
October 16th, 2008 at 7:40 am

#56 Rashiid

Statik, #53. Is the plug on the front bumper? I can’t quit figure out what that square is there for.

———————————-
Looks like a ‘placer’ for a ‘option’ not shown on that model, if you are talking by the headligt. No clue about the one by the fog light, probably just some kind of access hole. If we knew this was ‘next gen’ you could speculate some of the ‘quirks’ have something to do with the Lexus version.
Statik Says:
October 16th, 2008 at 7:40 am

Other random jottings:

Apparently GM had a contest to see ‘the most dispised executive’ on the team and James E. Taylor (whats with the E, how many James Taylors do they have), won big!

“GM names CEO for its Hummer brand slated for sale”
–The company said James E. Taylor will take over as CEO at Hummer, effective immediately. Taylor, who joined GM in 1980, had been the general manager for the Cadillac brand since 2004.

http://www.cnbc.com/id/27206358/for/cnbc/

Why would anyone leave managing Caddy for this job? I can only think of two reasons. Forced out…or ‘incentiv-itised’ out. I hope he got p-a-i-d…worst CEO job ever. Everyone hates your brand…like cigarettes, but you have no life expectancy as a company…unlike cigarettes.
Jason M. Hendler Says:
October 16th, 2008 at 8:14 am

I hope this is just a temporary situation for Tesla Motors.

It is so unfortunate that Martin Eberhard failed to deliver the Tesla Roadster in a timely fashion. Those 95% engineering types that can’t finish a design to hit the market window end up killing the products they claim to support. Now AC Propulsion is licensing the same tech that they licensed to Tesla Motors to a Taiwanese company for development.

Another opportunity lost.
Statik Says:
October 16th, 2008 at 8:48 am

Tesla’s issues have nothing to do with the economy. Or the state of the automarket.

Tesla has issues with under-capitalization, they always have. It seems like they are/were pretty well funded…and that would be true, if they were a start-up software company or they made plastic widgies, but they make cars….$100K+ electric cars.

We have a case here where they have a long, long waiting list…even after NOT producing cars in a reasonable timeframe. The question here for not only Tesla, but for GM, Chrysler, Mitsu, etc. is:

“At this point, can electric cars be made and sold for a profit?”
/I don’t know….we will see
Ed Says:
October 16th, 2008 at 9:08 am

When Tesla demanded that customers on the wait list pony up more money down before receiving the car you knew they were in trouble. They will use that money to produce the next batch of cars but it’s just a matter of time before that money runs out. Their only hope is a sale of the company. Closing down plants will slow down the amount of autos produced therefore holding onto cash (the deposits) longer. I wish them well but it doesn’t look good.
randy Says:
October 16th, 2008 at 9:51 am

GM Forget about merging with chrysler, take over tesla , it would be a great marriage, keep prodicing the roadster in greater lvolumes and at less cost.
ysf Says:
October 16th, 2008 at 9:52 am

darius #38, research is about sth unknown, fuel cell has greatest potential, this means there is a possibility that it will NOT be successful in 50 years, but efforts still should be made to do R&D. This is why I said that, despite it is self-serving to tell people to put money into battery R&D, but as a scientist, I have the conscience to let people know it is also important NOT to forget about fuel cell. That’s it!
nataraj Says:
October 16th, 2008 at 10:00 am

GM should take over Tesla and make it their pure electric brand.

Otherwise, someone else will.
Tom H Says:
October 16th, 2008 at 10:32 am

There are 64 posts here, but Statik #60, asks what I think is the right question.

“At this point, can electric cars be made and sold for a profit?”
/I don’t know….we will see”
——————————————————————————

Tesla’s problem is that batteries available today, and likely to be available over the next 3-4 years, simply do not support a BEV. My evidence is the car they have on the road–$100k for a car that seats two and cannot venture more than 60 miles from home (120 mile range).

The Tesla is for rich enthusiasts, totally impractical as a mass market car. That will not change for at least 3-4 years.

The Volt is a much better deal, a family 4 seater that can go anywhere, and will stay in electric mode 80% of the time for most people.

At $40k for the Volt and $3/gal for gas, the Volt is still impractical, but it is easy to envision that turning around within the next 3-4 years. Competition, mass production and better battery technology can be expected to drive the price under $30k. And after the global recession that seems to be starting, demand will drive gas back up to $4-5 per gallon.
Tom H Says:
October 16th, 2008 at 10:42 am

With all those said, I still believe GM made the right decision to terminate EV 10 years ago. I sincerely hope their perilous situation will not push them to misleading PR stunts, instead, they should still invest diligently in hydrogen research and fuel cell, two areas I am not an expert (I am a battery scientist), but knowledgeable enough to know their importance
————————————————————————–
No amount of research on fuel cells will change the fundamental fact that there is no economical source of hydrogen. H2 can be manufactured by reforming natural gas, but that requires fossil fuel and lots of energy, and gives off a stream of high temperature CO2. While anybody can sit at a PC and type the words carbon sequestration, the reality is nobody knows how to do that and still keep the cost under $20/gallon equivilent.

The other way to make H2 is by electrolysis. This sets up an energy cycle which is ridiculous.

Generate electricity 40-60% efficient
Electolyze water 22% efficient
Compress and transport H2 90% ?? efficient
“Burn” H2 in a fuel cell ??? efficient

PHEV is the way to go.
noel park Says:
October 16th, 2008 at 11:22 am

Delorean, Bricklin, Kaiser, Tucker, Hudson, Packard, Nash, Oldsmobile and hundreds of others. Most better capitalized than Tesla and run by “car guys”. If GM, Ford and Chrysler are all flirting with bankruptcy, what reason is there to think that any startup car company is going to succeed.
Dave G Says:
October 16th, 2008 at 12:07 pm

#63 ysf Says: “…fuel cell has greatest potential, this means there is a possibility that it will NOT be successful in 50 years, but efforts still should be made to do R&D. This is why I said that, despite it is self-serving to tell people to put money into battery R&D, but as a scientist, I have the conscience to let people know it is also important NOT to forget about fuel cell. That’s it!”
————————————————————————————–
It the big oil companies that are pushing fuel cells. They know it will probably never work, but if it does, hydrogen will be made from natural gas. Either way, big oil wins. Classic red herring. That’s why they call them Fool Sells.
http://www.physorg.com/news85074285.html
http://www.autobloggreen.com/2007/01/13/the-hydrogen-economy-is-a-bad-idea-a-really-really-bad-idea/
Rashiid Amul Says:
October 16th, 2008 at 12:24 pm

Fuel cells are totally impractical at this time and place.
PHEV is the way to go. Period.
N Riley Says:
October 16th, 2008 at 1:51 pm

#31 Texas

The price of oil is down and could go a little further down. Problem is that Saudi Arabia has called a meeting of OPEC to “talk about the lower price of crude”. What that really means is they are going to reduce production until the price comes back to a price they want. Certainly over $100.00 per barrel. Probably over $120.00 per barrel. Even with the reduced short-term price reduction of crude, we should not drop our plans to change our fuel of choice as soon as we possibly can do so. The cost of crude should not be a factor in that national priority, but we all know it will have some impact.
stas peterson Says:
October 16th, 2008 at 2:19 pm

Oh the wailing and gnashing of teeth. The eco-wackos have been been betrayed by Tesla. Elon Musk must be in a secret Conspiracy with “Big Oil”.

The Governator has been swindled, once again, as soon as he converted to counsels by the eco-wacko Democrats.,

First, Billions of California dollars for “research” in duplicating the fraud of made up lies by Dr Woo Suks of Korea and his phony embryonic stem cells research reports. No philanthropy would fund it, they moved on to genuine research on adult pleuripotent cells where real progress is being made.

So the government has to use taxpayer money to do it. Why? His new eco-wacko Democrat advisors told him to, natch. Have to justify baby- killing for Planned un-Parenthood.

Then they cajoled him into givingTesla oodles of California taxpayer’s dough for Tesla factories; that money is gone too, apparently.

The Governator should fire his new eco-wacko Democrat advisors, and then resign himself…
Jason M. Hendler Says:
October 16th, 2008 at 2:25 pm

Hydrogen will be the eventual solution. MIT discovered an efficient method of dissociating water into hydrogen and oxygen, so the old, tired argument about batteries being more efficient is now moot. Both methods are close in efficiencies, so now it is purely a matter of cost and supply of the needed materials.
Dave G Says:
October 16th, 2008 at 2:42 pm

#72 Jason M. Hendler Says:
October 16th, 2008 at 2:25 pm
Hydrogen will be the eventual solution. MIT discovered an efficient method of dissociating water into hydrogen and oxygen, so the old, tired argument about batteries being more efficient is now moot. Both methods are close in efficiencies, so now it is purely a matter of cost and supply of the needed materials.
————————————————————————————-
Here are the realities of hydrogen.

1) Hydrogen is not a fuel source, it’s a fuel carrier. In other words, some other energy source is required to make hydrogen.

2) The main energy sources for hydrogen are electricity (to crack water) and natural gas. Of these, natural gas is much more economical. There are other ways to make hydrogen, but these are even more expensive and inefficient.

3) Current electricity production uses 70% fossil fuels, 20% nuclear, and 10% renewable. The economics of renewables is such that this won’t change significantly anytime soon. So hydrogen in the U.S. will most certainly be created from fossil fuels.

4) The efficiency of hydrogen conversion, transportation, storage, and fuel cell electricity production is poor.

5) The net result of all the above is that hydrogen cars would create more CO2 emissions than our current gas engine cars.

6) The infrastructure of hydrogen fueling stations is nowhere in sight.

7) The big oil companies are pushing the hydrogen economy the most. They are also using the promise of fuel cells to help delay or prevent other solutions from fully taking hold. This is how they managed to kill the California zero emission vehicle mandate.

That’s why they call them “FOOL SELLS”
Dave G Says:
October 16th, 2008 at 2:53 pm

#31 Texas Says: “The price of oil is down to almost $70 a barrel and that is probably going to once again slow down the pace of development of alternatives. Truly sad because it’s the only thing that will matter in the long run.”
————————————————————————————–
Here are my predictions:

Oil prices will continue to decline until November 4th, and then go back up again. This is the normal pattern for presidential elections.

Oil will continue to stay high until 2010 or 2011, right around the time that the Volt and other plug-ins come out. At that point, oil will go down to $30-$50 a barrel. This will kill the Volt and other plug-ins.

Oil is NOT a free market. It’s a cartel. OPEC controls 75% of the world’s oil supply. They control prices.
Statik Says:
October 16th, 2008 at 4:57 pm

#74 Dave G

Here are my predictions:

Oil prices will continue to decline until November 4th, and then go back up again. This is the normal pattern for presidential elections.

Oil will continue to stay high until 2010 or 2011, right around the time that the Volt and other plug-ins come out. At that point, oil will go down to $30-$50 a barrel. This will kill the Volt and other plug-ins.

Oil is NOT a free market. It’s a cartel. OPEC controls 75% of the world’s oil supply. They control prices.
——————————————–
Your a very suspicious person, hehe.

I’m still going with the ‘we are in a worldwide recession’ so prices were bound to drop…and stay low for awhile.

OPEC actually controls about 55% of the market. They produce less than that percentage, at around 40-45ish percent, (32bpd of 86bpd worldwide production), but they export a much larger share relatively speaking…but that is splitting hairs, lol.

Of that (OPEC/exports), the Saudis really control the show…and they have a vested interest in the health of America. So much so that the last time OPEC tried to cut production, they got into a big ‘kafuffal’ about it and the Saudis broke with the cartel to, “meet the demands of the market” They still want a good buck, but they don’t want to push America off the cliff…like a dealer, lol.

I don’t think the ‘EV threat’ even blips on their radar…certainly not enough to artificially hold pricing at $30-$50 a barrel if the economy is improving. The scale of the money they would lose holding down oil by even a couple of dollars to try and defeat EVs would be….enormous.
Grizzly Says:
October 16th, 2008 at 5:02 pm

This comes as no surprise to me I really wondered, even in good times how Tesla would survive, and …now? I also think with his space program that Elon Musk is stretched pretty darn thin.

I’ll be surprised if Tesla survives.
Mark Z Says:
October 16th, 2008 at 5:29 pm

Visited the Tesla showroom in Westwood a couple of months ago. Great car and thought seriously of putting my name on the list. But after trying to get out of the drivers seat, the sales lady said, “Our sedan design will be available in 2010.” The Tesla seat is lower than the door sill, so it takes unusual effort to climb out. Other issues:

1. 70 amp circuit required + wall mounted unit for 3.5 hour charge.
2. Hardtop cannot be stored in the car. (Small trunk can store softtop.)
3. Range anxiety. A trip from LA to Vegas? The same problem as the EV-1 had, lengthy stops for charging at RV parks.

The E-REV in the VOLT is the way to go. Nonstop to Vegas, 4 seats, nice “trunk” space, and a much lower cost. Way to go GM.
Grizzly Says:
October 16th, 2008 at 7:13 pm

Mark Z #77

“The E-REV in the VOLT is the way to go. Nonstop to Vegas, 4 seats, nice “trunk” space, and a much lower cost. Way to go GM.”

*** *** ***

Don’t forget that the Tesla also has laptop batteries and it’s anyone’s guess how long they’ll last. I suspect that as cells fail like most laptops it’ll gradually lose range until it no longer accepts a charge.
Justin Weber Says:
October 16th, 2008 at 7:28 pm

Tesla really missed the boat. I think their arrogance upon start-up has finally caught up to them. I was one of those who saw the “60 Minutes” piece. To view the vehicle manufacturing process as somehow similar to building a software company or manufacturing circuit boards is pretty nieve. It took them a while to realize that manufacturing a vehicle is a complex process, involving a lot of “car” people and a lot of capital.

I don’t wish anything bad for Tesla, but this was a problem they could have avoided if they brought the right people in early on.

I wish GM well, and I think if they can get beyond this latest economic crisis, they will be well positioned for a strong resurgence. The Volt is great! The Cruze looks promising, and the cross-overs such as the Enclave and Traverse are wonderful products.
Freemon Sandlewould Says:
October 16th, 2008 at 11:55 pm

I knew Elon Musk was blowing it when I read he had the doors changed because his pregnant wife had trouble getting out of the Volt. Obvious he’s a software guy. A hardware guy knows that hardware development absolutely hemmorages money. Because of that we hardware engineers know to get the job finished on the straightest line possible with no detours for frillys. Then when done look back and decide if business and product acceptance demands round two on the hardware.
Bob Says:
October 17th, 2008 at 11:11 am

Elon Musk has definitely been a hands-on investor from the beginning. The doorsill modification was only one of the changes he pushed.

He also insisted on the 130mph top speed, which at the time required the two speed transmission. That was the change that caused the major delay. They had to redesign the chassis any to accomodate the ESS.

If he has been part of the problem, he has also put his personal fortune on the line.
DaveP Says:
October 17th, 2008 at 12:02 pm

For those thinking there will be lots of EV and plug-in hybrid choices soon, I think this is a sobering reminder not to count chickens before they hatch. Automakers have been reluctant to create EV drivetrains and there is kind of a fragile chain of one-upmanship going on even now.
Tesla is the head domino: Because Tesla made the roadster, GM/Lutz pushed to make the \Volt. Because GM is making the \Volt, Toyota is pushed to make a plug in Prius…
Hope for the best for Tesla. If they fold, a lot of strategies may be rethought and we could be set back yet another decade before we see electric drivetrains.

Granted it’s oversimplifying to say that if Tesla goes under all EV work stops. I’m not saying that, but it certainly does reshape the landscape of what is still a very nacient effort on the part of automakers.
jscott1000 Says:
October 17th, 2008 at 7:28 pm

Statik, I don’t always agree with you, but your comments on Tesla, (the man and the company) were spot on. Making any car and selling it for profit is difficult. Telsa, the man was never interested in making money. Telsa the company never said their car was practical. It’s a rich person’s toy to be sure. But if it can succeed in what it is then technically that’s a good thing.

as for ysf Says:

Tesla EV is fundamentally flawed due to their battery, they will NEVER be commercially successful due to the high cost of 18650 and complicated nature of handling 6800 cells, you can’t make a battery pack last long (even single cell may well does so), and it is dangerous.
—————————————-

The jury is still out on the 18650…NASA is currently building a battery to run the life support system on the space suit with 18650s. If that battery fails someone has 30 minutes to live before their air runs out. So I would say that technically they can be made safe if not commercially successful.
jscott1000 Says:
October 17th, 2008 at 7:31 pm

By the way, who said that BEVs and hybrids had to be economically viable? What about that Escalade Hybrid?
curtis Says:
October 17th, 2008 at 9:22 pm

#84- By the way, who said that BEVs and hybrids had to be economically viable? What about that Escalade Hybrid?
_________________________________________
What about it? I own one and I LOVE it! I’ve bought a new Escalade every 2 years for the last 8-9 years and refuse to drive anything else. But this new hybrid ‘Lade is so cool as I drive mostly in the city, in traffic, and I’m ruuning in mostly 100% electric or 2-mode “blend” with 4cyl mode on the DoD and I’m getting almost twice as much out of a tank of fuel as my 07.
So KMA!
C.
Stan Says:
October 18th, 2008 at 10:41 am

I think Tesla would still be fine if Martin Eberhard was still running the show. He was the founder and his biggest mistake was trusting Elon Musk. Martin wanted to keep it simple as all start ups should. Elon wanted to make it perfect and ended up complicating the whole process. I hope they can still hang on because I’d hate to see Martin’s dream die.
Stan

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