Special report:Is Tesla the future or the new Government Motors? - 24 volt lifepo4 battery pack

San francisco/DETROIT (Reuters )-
Tesla Motors Inc. 's chief executive and key investor, Elon Musk, sometimes mocked the United States. S.
The automaker, who paints his fledgling company as everything Detroit wants, if it can start over: Cooler, greener, and housed in a better community.
As part of a roadshow that attracted investors' interest in Tesla's initial public offering on Monday, Musk showed potential investors a map of the electric car maker San Francisco
It plans to acquire the regional headquarters and nearby assembly plants.
Tesla is located next to company neighbors such as Google Inc. and Apple Inc. for easy reference.
Nothing except the East Bay of San Francisco.
"Why should we succeed?
Why don't we be defeated by a big car company?
Many analysts and industry executives believe the issue is still pending, Musk said.
His answer is: start
Up culture will allow Tesla to be flexible in places where Detroit is slow-moving --
Moving, unwilling to bet on his vision, one daytoo-
In the distant future, every car on the road will be driven by electricity rather than oil.
But a review of Tesla's turbulent past shows that a series-
Musk likes the car company of diss-
Including Daimler and Toyota
Deep pockets of the United StatesS.
The federal government is crucial to getting the electric car maker on the road in the worst of the crisis.
With more doubts about the cost and adoption of pure electric vehicles over the next five years, investors will have to decide whether Tesla represents highrisk, high-
Return bets on emerging technologies or Silicon Valley versions of government cars.
Musk, the inspiration for the character Robert Donnie Tony Stark in Iron Manand-you-miss-
It's guest in this summer's sequel and looks very different.
"We are a Silicon Valley company.
In the way we operate, it's closer to Apple or Google than to GM or Ford, DNA, Tesla's operating system.
I don't think it's something that GM or Ford can replicate --
Musk said.
To highlight this, Musk opened fire on GM when GM was heading into bankruptcy last year.
In a speech in San Francisco, Musk said: "What If (former GM product director) Bob Lutz called to say we wanted to buy Tesla ? ", He asked a question and he said he had been asked before.
"I would say, 'You can't afford it.
Earlier Musk denied Lutz's proudest achievement, the plug-in.
In Chevrolet Volt, because "it's not very exciting.
The early and present of GM
"It's not a good car," Musk said . ".
Mr. Lutz, 78, says Tesla is lucky to replicate Detroit, which at least knows how to assemble and sell cars to the mass market.
Despite Lutz's admission of reluctant admiration for Tesla's push to develop all its $109,000 products --
When major automakers were hesitant about electric vehicles, he said Tesla underestimated the complexity of the business.
"So far, all of Tesla's shortcuts have failed," Lutz said in an email to Reuters . ".
"They seem to hold Silicon Valley's usual view that the region is the only brainpower bank in the United States, and everyone east of Silas is vague --Dinosaurs.
"On the verge of becoming a public company, Tesla has a quirky and charismatic CEO who has a Hollywood sensation at 39-year-old Musk and has an exhaust --
More free sports cars than beating Porsche from the start.
Before one of the most watched IPOs of the year, and before the first ipo by American automakers since Ford went public in 1956, Musk has been selling his 7-year-
The old startup is "an amazing technology velociraptor", ready to revolutionize the way Americans buy and drive cars.
However, the toughest path for Tesla is still ahead.
Since its inception, the company has consumed $0. 23 billion in cash, earning just $0. 148 billion.
The company expects losses to deepen with next year's commitment to preparing for the manufacture of S-type luxury electric cars, which it plans to launch in 2012 and start selling from $57,400.
To build the Model S at Toyota's abandoned Fremont assembly plant in California, the company will be required to comply with strict deadlines under US supervisionS.
The US Department of Energy has provided Tesla with a loan of $0. 465 billion.
"From the very beginning, we have worked closely with automakers and car suppliers and will continue to work with them on automotive electrified," said Tesla spokesman Ricardo Reyes . ".
"We are very grateful for our cooperation with Daimler and Toyota.
"The storyline of a dynamic startup founded by an attractive visionary is familiar to Detroit.
It rarely ends happily, and the gas engine has surpassed previous reports of its death.
As early as 1918, General Motors engine pioneer Charles Kettering had predicted that the internal combustion engine would die because of low energy efficiency.
Preston Tucker worked with GM, Ford and Chrysler after World War II to launch innovative car designs, including safety innovations such as car headlights and broken windshield.
Before his bankruptcy in 1949, his company assembled only a few cars. In the mid-
1970 s, John delonen, used the groundbreaking GTO muscle car to reverse GM's Pontiac brand at 1960 s, launching his own stainless steel body and seagull sports carwing doors.
The project was folded up and DeLorean was called the impossible time machine in the movie back to the future.
GM's Lutz, a legendary "Motorman", became a foil and enemy for young Musk in the last years of his career at the company, tesla has similar arrogance.
"These talents can always get what they deserve," he said . "
A major risk for Tesla and other electric car manufacturers is whether American consumers will buy cars that will take several hours to charge.
The cold weather will enter the advertising range of lithium.
Ion batteries that power new electric vehicles.
So the driver would take it for granted that convenience like running a heater or air conditioner, and Tesla applied for a system patent that allowed the driver to switch the Model S to "extended range" mode, to save miles of highway mileage.
In addition to Nissan, most major automakers expect "mileage anxiety" to limit electric vehicles to a much smaller market share than Toyota Prius or plug-in hybrids
In a hybrid such as the upcoming Chevrolet Volt, the car will be covered with an on-board gas engine.
Another big obstacle is the cost of the battery.
For the sports car, Tesla took out 6,831 laptop batteries and connected them together in a liquid-cooled package, weighing about 900 pounds, with an initial production cost of about $30,000.
Analysts differ in how much and how fast battery prices will fall.
They agree that the success of electric car companies like Tesla is a key variable.
An industry group representing Detroit automakers has set a long-term goal of reducing costs to around quarterly levels at the moment.
But Boston Consulting Group questioned whether this could be achieved without a breakthrough in battery chemistry, and no one could predict.
If no higher production or new technology leads to a sharp drop in battery prices, only extended government subsidies can make electric vehicles affordable, analysts said.
In a report earlier this month, the National Academy of Sciences also concluded that pure electric vehicles, due to their limited scope and relatively high costs, will remain a small part of the market.
Industry researcher Jay Baron said: "If the price of gasoline stays at $3 a gallon, all of these technologies are hard to justify --"
The auto research funding center that contributed to the study.
"Unless there is a drastic change in oil prices, all of these technologies will enter the market very slowly.
"Even if the technology works, it is a question whether the Tesla brand can build on the early popularity.
A survey by Deloitte Consulting found that most consumers said they were most likely to buy electric vehicles from Toyota, Honda or Ford.
Tesla lags behind established luxury brands such as Audi, BMW, Lexus and Cadillac, and only 2% of respondents said they would consider buying.
Oliver hazme from Detroit
PRTM's director of electric transport consulting believes automakers will succeed in reducing battery costs by more than half over the next decade.
But he thinks the future of Tesla is tough. alone brand.
"This is an interesting case because when no one else is there, they are really pioneers in the field of electric vehicles," he said . ".
"But the question for the future is, can they continue as a niche player?
I believe the answer is not true.
"After early setbacks and slow development, Tesla has delivered more than 1,000 sports cars. than-
Production is expected to begin.
The list of owners includes celebrities such as George Clooney, Jay Renault and Red Pepper striker Anthony kidis.
But Musk believes that Tesla can make a leap to the mass market almost overnight, establishing production, engineering and sales within 24 months, which is another century for other sectors of the industry.
The goal is to sell 20,000 S cars a year, and then derive a variety of models, including a van and an SUV --Cross style.
While the sports car has a mileage of 236 miles per car, Tesla plans to launch a new model that is cheaper, with a mileage of 160 miles per car.
The upgrade will provide a larger battery and 300-mile range.
Tesla is still designing the Model S so that its batteries can be easily replaced and can be quickly charged in the electric vehicle facilities on the side of the road that don't exist right now, but one day
By limiting production costs and selling a range of upgraded products to customers, Tesla is expected to add another $25,000 to the price of the regular Model S, thus maintaining a 25% car profit, Wild
Measure the target by automotive industry standards.
Meanwhile, Musk hopes to open up new ways of selling cars in the United States by cutting franchise dealers.
Tesla now has 12 stores and is expected to have 50 stores in stock by 2012-
Free storefront for promoting brands and soliciting orders.
Unlike any other automaker, Tesla plans to control all its sales and service work
When the customer is too far away from the store to drive or be dragged into the service, dispatch the "Tesla Rangers" to repair the car.
Musk said that the established system of independent car dealers has created "basic economic inefficiencies" and "the same shopping experience as going to the dentist ".
"But the company said in its prospectus that its plan to run its own store could violate the national franchise law and the cost of sending technicians to the Far East --Remote areas.
Analysts believe Musk's goal is
Even for an executive, his vision includes eliminating the use of oil in transportation and helping humans settle on other planets through his company Space X.
(Musk said: "The Holy Grail is for life to fly Interstellar . "
) In the short term, Tesla's efforts to protect high pricing will face challenges from competitors such as GM rechargeable Volt and pure electric Nissan Motor Company Leaf, later this year, both phones are available.
Model S must also compete with the mature and future products of luxury brands such as BMW, Audi and Lexus.
"At the end of the day, it's a high-fixed-cost industry," said Jeremy Anwyl, chief executive of Edmunds, a car tracking company. com.
"Even with the help of Tesla, the deck is stacked.
"During Tesla's first major crisis, the blind call to help it get out of trouble came from a place that was unlikely to happen: the Detroit suburb, the center of the old-fashioned auto industry.
December 2007, with the United StatesS.
Bill Kelley, executive president of BorgWarner Inc. , read about Tesla's problems in finding reliable transmission and the automotive industry is heading for a crisis.
Kelly, who is in charge of the bogwarner advanced technology project, saw the opportunity to sell low-priced cars to Tesla.
A cost solution to the problem of threatening to kill a sports car.
But Kelly sat in Michigan and didn't get in touch with Tesla, so he sent a blind email to Tesla's webmaster who set up to promote the sports car.
"I said, 'I think I can help you,'" he recalls '.
"I got a call a few days later, 'How can you help us? '?
The deal took place during a storm in Tesla.
Two months ago, the company canceled an agreement to use Magna International for transmission.
In December, the company fired Martin Eberhard, its founder, as chief executive.
Personal data dispute with Musk
Eberhard used his blog to describe the "massacre" of 26 Tesla employees who were fired "--
Starting point of about 10%Is the staff of up
Musk retorted that Eberhard had hidden evidence of cost overruns on Tesla's board.
Tesla later settled Eberhard's lawsuit and dropped its claim against him.
On March 2008, Kelly flew to Tesla's headquarters in Palo Alto, California, and met with Musk and his appointed new chief executive, Zeev Drury, to market his views.
Kelly, eager to use the Tesla contract as a technical demonstration of bogwarner's work, offered to build a sports car transmission at an astonishing low price he expected to be seen.
BorgWarner is ready to use technicians from its Auburn mountain research department to build low
He told Musk and Drury that there were bulk orders on site.
"I made an offer and I don't think they can refuse it: I told them we will do it for $100,000," Kelly told Reuters . ".
To his surprise, Musk didn't seem interested in thinking Tesla could design a better transmission from scratch.
At that time, Musk proposed to launch a sports car with a temporary transmission and then change it to a new improved model --
It's common in software, but it's unheard of in the automotive industry.
"They don't want to get down from that horse right away and get on the other horse," Kelly said . ".
"At the end of the day, we had a baked --
We won.
Bogwarner first delivered the test transfer in June after winning Tesla's order-
Three months after the first meeting.
The company agreed to sell the small batch of products in the segment to Tesla to keep Tesla's cash consumption at a minimum.
When the part needs a stronger bracket, it turns to the aircraft supplier to purchase a high-strength aluminum bracket.
"There is no time to look for more elegant solutions," Kelly said . ".
BorgWarner, who is now building the last 150 contracted transmission devices for Tesla, believes the deal is a success and a win-win
This allows Tesla to develop new product lines while allowing Tesla to turn to full production of sports cars.
But even so, in the translation process between Silicon Valley and Detroit, some aspects of the process may be lost.
On one occasion, Tesla failed to submit a purchase order for the new transmission to the three vehicles
BorgWarner expects and needs a month's lead time.
The glitch once threatened the production of sports cars.
"For us, that's how you do business," Kelly said . ".
"Unlike computer chips, when you make things out of steel, it only takes time.
Tesla's next big crisis took place in the fall of 2008, when it failed to get $100 million from risk investors.
Like its larger rivals, it has also been hit hard by the 2008 credit crunch.
By the end of $9 million in cash, Tesla cut 24% of its workforce, delayed the development model S and launched a $40 million convertible bond financing to keep the company alive.
By then, Musk had invested $55 million in Tesla, and he also served as chief executive.
He said at the time: "I have too many chips with Tesla to take responsibility for the management . ".
Musk aroused strong emotions in the people he worked.
They either love him or hate him.
But even those who have been fired by him do not like what they call the relentless stripes, and they say they admire his drive and vision.
The credit crisis has made Musk unlikely for Tesla to turn things around.
He is sometimes upset by industry activities and speeches.
In an appearance in April 2009, Musk laughed when it came to the risk that sports car batteries might explode in flames --
A "runaway heat event" that destroyed the laptop ".
Tesla has at least two patents on the system to prevent the risk of this potentially fatal event, but Musk briefly found the problem interesting.
"What is the worst possible situation?
He said with a smile.
As CEO, his first challenge is to reassure customers who are nervous about sports cars.
By that time, more than 1,200 people had placed orders.
But less than 30 cars were delivered.
Potential customers are increasingly worried about the fate of Tesla's deposits to fund its operations between $5,000 and $60,000.
Musk, who tried to stop Tesla's cash flow, said he would personally guarantee that automakers would do well on all orders.
"I have put on the record that I personally stand behind the delivery of cars and deposits for the company," he said on October 2008 . ".
"I have the means and the funds to do so.
So people should pay absolutely zero attention to their deposits.
The strategy worked, according to a court document, but after just over a year Musk had no money.
"I ran out of cash about four months ago," Musk said in a February 2010 document . ".
"I had to get an emergency loan from a private friend.
These loans are my only source of cash.
Musk separated from his wife, fantasy novelist Justin Musk in June 2008.
After 2000 of what Justin called "extremely harsh"
The wedding agreement allowed her to keep her book while allowing Elon to keep more than $20 million in assets, including a seagull
A $1 million McLaren supercar.
According to Justin Musk, Elon is worth $1 billion.
He will profit about $14 million from the sale of Tesla shares, but will remain the company's largest shareholder, holding nearly 29%.
Musk became famous when PayPal, the Internet payment company he developed, was bought by eBay for $1.
2002 5 billion.
In an early success, he sold catalog provider Zip2 to Compaq in 1999 for $0. 3 billion.
But he also chose to invest most of his wealth in three new companies.
Tesla, SpaceX and solar cities.
He once described the idea of a calm retirement as "a torture," recalling that he had challenged himself to live on less than $1 a day after leaving South Africa for Canada. year-old student.
"People tend to overestimate risk at a personal level," Musk said in an interview on 2008 . ".
Darryl Siry, Tesla's former chief marketing and sales executive, left Tesla in December 2008 for "strategic disagreements," and Musk's ability to remain calm during the crisis was almost inhuman.
"His tolerance for risk is beyond what I see," said Siry . ".
"When I felt sick in the environment we were in, he was part of him.
Musk's investment in Tesla has exceeded $70 million, becoming the key to winning new support from established automakers and Washington for the company.
As part of the United StatesS.
The government's loan, Musk must hold a 65% stake in Tesla, otherwise it will face the risk of default.
Justin Musk is seeking a 10% share of Tesla's stock, $6 million, child support and sports cars.
Tesla said it did not believe that Musk's divorce would jeopardize government funds, undermine his ability to lead the company, and would not force him to sell shares.
"This is allowed to turn into litigation. . .
Elon is taking risks and, frankly, no one seems to understand, "Justin Musk wrote in the 2010 blog.
After the financing crisis, Musk won a major victory in January 2009 by convincing German auto giant Daimler to cooperate.
According to the original agreement, Tesla agreed to supply lithium
Ion power supply and charging system for 1,000 smart electric vehicles.
The supply agreement provides Tesla with another way to generate revenue and offers a lot --
From the beginning, a mature car manufacturer's verification is needed. up.
"You already have a company that invented an internal combustion engine car, which is coming to Tesla around the world," Musk said in an IPO roadshow . ".
"It's like Gutenberg said, 'Hey, can you make a news for me? '.
Daimler then bought nearly 10 cars-
Shares not disclosed by Tesla in May 2009.
Musk said the deal was "between about $100 million and zero.
After that, Daimler added another 500 battery pack orders and asked Tesla to make battery packs for the small Mercedes electric vehicle launched in 2011, with an investment value of about three times that of $0. 16 billion in Tesla.
"The decision we made. . .
This seems to be a pretty good company as the company goes public, "said Herbert Kohler, Daimler's vice president, who is a member of Tesla's board of directors.
"It means that this is the right contact from an economic point of view.
Korer said Musk was the key to a deal.
Daimler has made sure that they will only handle it through him until the Model S is released, locking him into the CEO.
According to documents submitted by Tesla to securities regulators, Daimler has the right to withdraw from Tesla if Musk leaves the company before 2012.
"Elon is a very important part of Tesla," Kohler said . ".
"Without Elon Musk as CEO, we wouldn't have decided to go that way.
As Daimler joined, Musk's focus shifted to receiving government subsidies from the United States. S.
Government loans.
For the past three years, Tesla has sought political support from both parties for its expansion.
Arnold Schwarzenegger, California's governor, was his main ally and found that the low-riding car was too small and is now waiting for his Model S.
Back in 2007, Secretary of State Rice of the Bush administration showed the sports car to a visiting Australian official and conducted a test drive.
She gave her thumbs up and announced the journey like a "little rocket ship.
"We want to see the great achievements of Tesla," she added . "
But in early 2009, Diarmuid O'Nell, Tesla's head of government affairs, turned his attention to Democratic Congress and the Obama administration, lobbying funds for Model S and its nascent battery pack business.
The stadium combines a call to support the environment and the elderly.
The American model of innovation has worked.
Tesla is one of the first three automakers.
With Ford and Nissan rivals
Qualify for a loan to support electric vehicles under the 2008 program.
Tesla has pulled $45 million from $0. 465 billion in government loans, although it tries to distance itself from potential criticism of receiving subsidies.
"This is not a stimulus.
This is not a bailout, "Musk said at the time.
People familiar with the matter said that with the support of government funds, Tesla is ready to apply for an IPO by November 2009.
Search for Love in Musk
When Tesla filed its IPO in January, most of the key elements of its strategy were in place --
In addition to an obvious hole: it has not yet built a model on a website.
Once again, it is a car company that has been set up, riding a horse to rescue, and Musk has completed the deal.
Toyoda, a Toyota Motor Company, spent the first few months of 2009 trying to survive a safety crisis, forcing the world's largest carmaker to recall more than 8 million vehicles.
Toyota has also been protested by American auto workers and politicians sympathetic to Toyota, who have asked Toyota to close NUMMI in Fremont, which has worked with GM to build Corolla and Tacoma.
When Toyoda sent news to Musk that he was interested in meeting, Musk made a charm offensive.
He invited Toyoda to eat at the Belaire building, and for $50,000 a month, he allowed Toyoda to drive a sports car in the Westwood area of Los Angeles.
The 54-year-old Toyoda, an avid test driver, said he decided to work with Musk on the spot. “Musk-
"I love him," said Mr. Toyoda, who is struggling to express his admiration for the young entrepreneur.
Toyoda hopes to rekindle the spirit at Toyota, agreeing to invest $50 million in Tesla.
In a related agreement, Tesla agreed to pay $42 million for NUMMI.
Toyota, market-
The leader in hybrid technology also agreed to help Tesla purchase parts for Model S.
The two sides said they would work together to launch electric vehicles.
Musk told investors he expects Toyota to become a customer.
"After Toyota announced, interest in buying Tesla shares has increased significantly," said Greg ditrick, a broker for the private company stock online market, the Nasdaq spost.
But UAW still wonders if Tesla can run its large new plant near capacity.
Bob King, the newly elected UAW chairman, said earlier this month: "Tesla is a smokescreen," calling Toyota's investment in Tesla a "trick" to deceive California voters, let them think that there is no loss of employment opportunities.
"People in California should be angry.
While analysts say Tesla's odds are big, the company has created a prestigious brand and won deals with Daimler and Toyota, giving it the chance to succeed
Research analyst Benjamin Stein and Chris Tater
Tesla said that it will not start trading fundamentals until 2013.
While the IPO appears to have priced the company at "stretch" or best case level, Tesla's call options are "worth considering," they said ".
"Tesla's stock is only for those who like high yields --
They said: "octaane investment.
Despite sniping on both sides, GM's Lutz is reluctant to write off Tesla and Musk --
At least not yet.
"Tesla may still be an exception," he said . "