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Breaking: Tesla to Unveil Model S Sedan on March 26 and Has Been Accepted for $350 M in Government Loans to Build it

 
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Image: Businessweek: http://www.businessweek.com/magazine/content/08_44/b4106080147392.htm

Image: Businessweek: http://www.businessweek.com/magazine/content/08_44/b4106080147392.htm

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Tesla Motor Company CEO Elon Musk has just announced that the US DOE has granted their request for loans and expects to receive $350 million in loans within 4 to 5 months that will go towards producing the 4-door 5 -seat Model S electric sedan. This they say will allow them to have the car in production in 2011.

Furthermore Tesla now plans to unveil a "street-drivable prototype of the Model S four door sedan" at the SpaceX rocket factory on March 26th.

The company also reports it expects to be profitable by mid-year largely because it has already sold out its full production capability of Roadsters through the end of the year.

Press Release Below:

Tesla to be Profitable by Mid Year

The $40M financing round completed in December was twice the amount Tesla needed to reach profitability. Moving forward two months later, we remain on track with our cost reductions and production ramp, so it appears highly likely that Tesla will meet the goal promised to those investors of becoming profitable by mid year.

The main reason for this confidence is that Tesla is already in the fortunate position of being sold out until early November, something few automakers can claim, and will soon be sold out of all 2009 production. While we have had some cancellations due to buyers experiencing personal financial difficulties, new orders continue to flow in every week from the United States and Europe. We have now produced more than 200 Roadsters for customers and there are more than 1,000 customers still awaiting delivery.

Due to our order backlog, it seems that owning a Roadster can be a good investment. Last September, as the financial and real estate markets began crashing, a Roadster was sold at the Sonoma Paradiso in California wine country for $160,000, well above the current list price of $109,000. Many Roadster owners who have taken delivery of their cars have already decided to purchase a second Roadster or Roadster Sport because they like the first one so much.

The continued strong demand is driven by the fact that the Tesla Roadster has no direct competitors. It is faster than almost any sports car on the market (our Roadster beat a Porsche GT3 on the Top Gear test track) and yet uses less energy and has a smaller carbon footprint than a Toyota Prius, even if you assume the worst possible case where all electricity comes from coal.

I expect sales demand to strengthen further as this awareness grows. After all, what’s the point of driving another exotic sports car when it is slower than a Tesla and damages the environment? Already, the Tesla Roadster is the car of choice among the technology, business and Hollywood A lists – this year’s Academy Awards will be a lineup of Teslas – and we have never had to give a discount to anyone.

Many customers also appreciate the fact that profit from their purchase goes towards helping Tesla develop more affordable, mass market electric cars. The same cannot be said for those who buy gas-guzzling sports cars from other automakers.

And owners aren’t the only ones impressed with the Roadster. Road & Track was the first auto enthusiast magazine to perform third-party, instrumented testing on the Roadster; they were “pleased to see its extravagant claims confirmed.” The Washington Post’s Warren Brown gushed, “Wheeeeeee! If this is the future of the automobile, I want it.” Dan Neil of the Los Angeles Times had perhaps the most colorful description we’ve seen to describe the Roadster’s scorching acceleration: “God has grabbed me by the jockstrap and fired me off his thumb, rubber band-style. Wow.” And we’ve also had a torrent of reviews in Europe, where deliveries begin this summer – including a Le Monde story with our favorite headline: “Le chic électrique.”




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Comments (6)
  1. "Noel Park"

    Now that is BIG NEWS. Well done Dr. Dennis.
     
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  2. "Family Car Guide might launch with a cool story!"

    I can't wait to see if that back seat is viable for a couple of kids! Yep, I'm always looking at ways to make a fun car like the Tesla work for someone with kids. Really, as long as the safety ratings turn out well, think about it! If your kids are big enough to not need car seats, I'd pitch this as a "family vehicle!"
     
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  3. "Tesla has NOT been granted loans!"

    Tesla writes to clarify: "I should note that we have NOT received final confirmation from the DOE that we will receive funds. However, we are in the later stages of the process, where the DOE is evaluating Tesla's financial viability and technical merits. They are doing their due diligence."
    See my story on the same topic at: http://www.greencarreports.com/blog/1018496_tesla-claims-profitability-by-mid-year
     
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  4. "No thanks"

    Unfortunately, Tesla has now joined GM and Chrysler on the list of car companies I shall not do business with in future.
    You'll already be getting some of my money now, Mr. Musk, without my consent. You'll not get one cent more from me.
     
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  5. "Not quite a BAILOUT"

    @jkp: I appreciate your feelings I too am very frustrated with having my tax money go to car makers who have missed the mark for years and are now crying for help. The difference here is that Tesla is paving the way for a smarter, cleaner future. Besides, this is not a "gift" but a loan.
    I say LOANING 350Million to keeping the next wave of automotive tech coming from American soil is a loan worth making.
     
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  6. "I'll Pass"

    I prefer to buy my vehicles based on the vehicles' actual performance not on how well the the vehicle conforms to the current state sponsored fad. This venture does seem like a good way to clip the libz for $350 mill though. I've got to give them that. I predict that this venture doesn't pan out.
     
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