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About Tesla
Overview
Tesla Motors is named after electrical engineer and physicist Nikola Tesla. The Tesla Roadster uses an AC motor descended directly from Tesla's original 1882 design. The Tesla Roadster, the company's first vehicle, is the first production automobile to use lithium-ion battery cells and the first production EV with a range greater than 200 miles (320 km) per charge. Between 2008 and March 2012, Tesla sold more than 2,250 Roadsters in 31 countries. Tesla stopped taking orders for the Roadster in the U.S. market in August 2011. Tesla unveiled the Tesla Model S all-electric sedan on March 26, 2009. In December 2012, Tesla employed almost 3,000 full-time employees. By January 2014, this number had grown to 6,000 employees.
Corporate strategy
Tesla's strategy has been to emulate typical technological-product life cycles and initially enter the automotive market with an expensive, high-end product targeted at affluent buyers. As the company, its products, and consumer acceptance matured, it is moving into larger, more competitive markets at lower price points.
Aiming premium products at affluent "thought leaders" is a very well-known business strategy in Silicon Valley and the global technology industry, where prices for the first versions of, for example, cellular phones, laptop computers, and flat-screen televisions start high but drop with subsequent products as the technology matures and production volumes increase. According to a blog post by Musk, "New technology in any field takes a few versions to optimize before reaching the mass market, and in this case it is competing with 150 years and trillions of dollars spent on gasoline cars."
While the Roadster's base price was US$109,000, the Model S's base price was US$57,400,and the company plans to launch a US$30,000 vehicle, codenamed BlueStar.
One of Tesla's stated goals is to increase the number and variety of electric vehicles (EV) available to mainstream consumers by:
selling its own vehicles in company-owned showrooms and online;
selling powertrain components to other automakers
serving as a catalyst and positive example to other automakers
Tesla focuses on pure electric propulsion technology, even for larger vehicle segments and ranges beyond 200 miles. Musk won the 2010 Automotive Executive of the Year Innovator Award for hastening the development of electric vehicles throughout the global automotive industry.
Business model and automotive dealership disputes
Tesla operates stores or galleries—usually located in shopping malls—in 22 U.S. states and Washington DC. Customers cannot purchase vehicles from the stores;, but must order them on the Tesla Motors website instead. The stores act as showrooms that allow people to learn more about Tesla Motors and its vehicles. The galleries are located in states with more restrictive dealership protection laws, which prevent discussing prices, finances, test drives, and other restrictions.
Tesla's strategy of direct customer sales and owning its own stores and service centers is a significant departure from the standard dealership model currently dominating the U.S. vehicle marketplace. Tesla Motors is the only automaker that sells cars directly to consumers, with all other automakers using independently owned dealerships. states have laws that limit or ban manufacturers from selling vehicles directly to consumers,] and even though Tesla Motors has no independent dealerships, dealership associations in multiple states have filed numerous lawsuits against Tesla Motors, trying to block the company from selling cars in some states. North Carolina and New Hampshire sided with Tesla Motors while Virginia and Texas have taken the opposite position.
Battery technology
Unlike other automakers, Tesla does not use single-purpose, larger format cells. Tesla uses thousands of lithium-ion 18650 commodity cells. 18650 cells are small, cylindrical battery cells, which are usually found in laptops and other consumer electronics devices. Tesla Motors uses a unique version of these cells, designed to be cheaper to manufacture and to be lighter than the standard cells. The cost and weight savings were made by removing some safety features which, according to Tesla Motors, are redundant because of the advanced thermal management system and a protective intumescent chemical in the battery pack. This chemical is intended to prevent battery fires. Currently Panasonic, a Tesla Motors investor, is the sole supplier of the battery cells for the car company.
Tesla Motors may have the lowest rates for electric car batteries; the estimated battery costs for Tesla Motors is around US$200 dollars per kWh. Currently, Tesla Motors charges $10,000 dollars more for the 85kWh battery than the 60kWh battery, or $400 per kWh. At $200 per kWh, the battery in the 60kWh Model S would cost $12,000, while the 85kWh battery would cost $17,000.
Competition
General Motors' then-Vice Chairman Robert Lutz said in 2007 that the Tesla Roadster inspired him to push GM to develop the Chevrolet Volt, a plug-in hybrid sedan. In an August 2009 edition of The New Yorker, Lutz was quoted as saying, "All the geniuses here at General Motors kept saying lithium-ion technology is 10 years away, and Toyota agreed with us—and boom, along comes Tesla. So I said, 'How come some tiny little California startup, run by guys who know nothing about the car business, can do this, and we can't?' That was the crowbar that helped break up the log jam."
History
Tesla Motors was incorporated in July 2003 by Martin Eberhard and Marc Tarpenning, who financed the company until the Series A round of funding. Both men played active roles in the company's early development prior to Elon Musk's involvement. Musk led the Series A round of investment in February 2004, joining Tesla's Board of Directors as its Chairman. Tesla's primary goal was to commercialize electric vehicles, starting with a premium sports car aimed at early adopters and then moving as rapidly as possible into more mainstream vehicles, including sedans and affordable compacts.
Musk took an active role within the company and oversaw Roadster product design at a detailed level, but was not deeply involved in day-to-day business operations; Eberhard acknowledged that Musk was the person who insisted from the beginning on a carbon fiber body and he led design of components ranging from the power electronics module to the headlamps and other styling. In addition to his daily operational roles, Musk was the controlling investor in Tesla from the first financing round, funding the large majority of the Series A capital investment round of US$7.5 million with personal funds. From the beginning, Musk consistently maintained that Tesla's long-term strategic goal was to create affordable mass market electric vehicles. Musk received the Global Green 2006 product design award for his design of the Tesla Roadster, presented by Mikhail Gorbachev and he received the 2007 Index Design award for his design of the Tesla Roadster.
The Tesla obelisk is used to identify the Supercharger network sites in California.
Musk's Series A round included Compass Technology Partners and SDL Ventures, as well as many private investors. Musk later led Tesla Motors' Series B, US$13 million, investment round that added Valor Equity Partners to the funding team. Musk co-led the third, US$40 million round in May 2006 along with Technology Partners. Tesla's third round included investment from prominent entrepreneurs including Google co-founders Sergey Brin & Larry Page, former eBay President Jeff Skoll, Hyatt heir Nick Pritzker and added the VC firms Draper Fisher Jurvetson, Capricorn Management and The Bay Area Equity Fund managed by JPMorgan Chase.[151] The fourth round in May 2007 added another US$45 million and brought the total investments to over US$105 million through private financing.
Facilities
Tesla Motors' headquarters are located in Palo Alto, California. As of August 2013, Tesla operates over 50 company-owned showrooms worldwide.[178] In July 2010, Tesla hired former Apple and Gap Executive George Blankenship as Vice President of Design and Store Development to build Tesla's retail strategy.
United States
Tesla was founded in San Carlos, California, in Silicon Valley. Tesla opened its first retail store in Los Angeles, California, in April 2008 and a second in Menlo Park, California, in July 2008. The company opened a display showroom in New York City's Chelsea art district in July 2009. It also opened a Seattle, Washington store in July 2009. Tesla subsequently opened stores in Washington, D.C.; New York City; Chicago; Dania Beach, Florida; Boulder, Colorado; Orange County, California; San Jose, California and Denver, Colorado. In 2010 Tesla moved its corporate headquarters and opened a powertrain development facility at 3500 Deer Creek Road, in the Stanford Research Park in Palo Alto. Tesla financed the project in part through US$100 million of the federal low-interest loans. The new facility occupies 369,000 sq ft (34,300 m2) on a 23-acre (93,000 m2) parcel previously occupied by Agilent Technologies. About 350 employees were expected to be based at the Stanford site initially, potentially increasing to 650.
Board of directors
As of 2014, the Tesla Motors board of directors consists of:
- Elon Musk—Chairman of the board of directors, CEO and Product Architect of Tesla; former President of PayPal, founder, CEO and CTO of SpaceX; Chairman of the board, SolarCity
- Brad Buss—CFO, Cypress Semiconductor Corp
- Ira Ehrenpreis—General Partner, Technology Partners
- Antonio J. Gracias—CEO and Chairman of the Investment Committee at Valor Equity Partners
- Steve Jurvetson—Managing Director, Draper Fisher Jurvetson.
- Harold Kroeger—Mercedes-Benz Vice President, responsible for electrics and electronics
- Kimbal Musk—CEO of Medium, Inc., Co-founder Zip2
