Tesla to Go Mainstream
Tesla VP on details of the company's planned expansion
Posted by Joshua Condon on Monday, August 31, 2009 11:49 AM
Last Monday, AutoWeek reported that Tesla will take advantage of millions of dollars’ worth of low-interest government loans to expand its stable beyond $100,000 sports cars. The announced goals, aimed at appealing to mainstream car buyers, starts with a $50K family sedan in 2011, followed by a mass-market car that retails for less than $30K by 2016.
Exhaust Notes contacted Tesla’s vice president of business development, Diarmuid O'Connell, to learn more about the company's expansion and store roll-outs, and whether the U.S. is ready for the electric car.
Exhaust Notes: How has the new government money (Editor’s note: $465 million in low-interest loans from the U.S. Department of Energy) affected your expansion plans? Are things moving more quickly?
Diarmuid O’Connell: The short answer is that there’s no correlation between these new loans and our plans. We’ve had a very aggressive strategy outlined since 2006, which started with the Roadster but always had an eye towards moving onto a midpriced sedan, and then a mass-market car for under 30 grand. [Our original loan process] started back in December of 2006, so while these new loans make things easier, this plan has been in place and viable since before that money was available.
EN: The Model S family sedan is slated for 2011, which is right around the corner. Is the average American ready for an electric car?
DO: Absolutely. We’ve developed long-range EV options – batteries that go 240 miles on a charge and can be recharged overnight in a 110 or 220 volt socket, like a cell phone. The average driver in this country travels less than 40 miles per day in their car, and I think we’re evolving towards a situation where people are discerning car’s best uses – every vehicle in a garage doesn’t have to serve every purpose, so your Tesla can be your everyday commuting car, and you have another vehicle for towing, or long road trips. People are already doing that.
That being said, any market research in this field is, essentially, conceptual market research; there aren’t enough EVs on the road yet, so people are really forced to imagine a new situation, which can be difficult. We’re obviously focusing on the deep-penetration hybrid market – places like Los Angeles and Boston – but our goal is to make our vehicles attractive to everyone. At the end of the day, it’s incumbent on automakers to build attractive, fun, well-designed and high-performance vehicles. And that’s exactly what we’re doing and will continue to do.
EN: What about concerns that you don’t have an infrastructure in place to deliver and service these vehicles? The typical driver has probably never seen a Tesla store.
DO: Our store strategy is robust, and we’re rolling out stores in Munich and Chicago in September, which adds to our current stores in West L.A., Silicon Valley, New York, London and Seattle. By the end of the year, we’ll have rolled out new stores in Miami, Washington D.C., Toronto, and Monaco. But even where we don’t have stores, we employ remote techs who will make house calls for service and repairs and, if need be, personally deliver the cars to the nearest Tesla store.
Our view on all of this is absolutely long-term: We don’t need to sell an EV to every single person, tomorrow, to be successful. Over time, we will create a mass market for our cars that will be sustainable and grow based on vehicle quality, design, performance and customer satisfaction. These new vehicles are the next step in that evolution.
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El Keter#1
Wednesday, September 02, 2009 7:03:55 PM
Where does a company named after Nicola Tesla get off selling overpriced sports cars and "bargain" sedans and mass-market cars that retail for $50k and $30k?
If Nicola Tesla was alive today and running a car company his cars would all run on happy thoughts (or electricity) and wouldn't retail for more than a few thousand bucks.
Kokorami#2
Wednesday, September 02, 2009 6:38:37 PM
"whether the U.S. is ready for the electric car." Actually, while I don't know much about the history of cars, I know enough history to know the writer didn't really do his homework here...in the early days, the electrics had a good share of the market (Baker, Detroit Electric and others) and I vaguely remember those funky little electric wedge cars growing up in the 70's. Should be "whether the U.S. is ready for electric cars again."
There really isn't anything new under the sun. Also, it's a perfectly good idea for people who can afford and get good use out of it. If you have good public transport/actually need or use a truck/aren't off the grid/are self-employed and working out of your house/whatever, and don't have a use for it, that's fine, too. But no need to knock it for people it's a good option for. Me, I drive a diesel and run it/top off the tank on biodiesel as much as I can. (Ethanol ISN'T the only biofuel, and compared to bagasse, corn ethanol is total BS.) Esp. when I pass by the place where they make it from waste grease. Some people do a grease conversion; I talked with them and as a person who on average covers 15 miles a day at most it wasn't the best option. We probably should change our driving habits (I'm getting a bike to cut down on that 15 miles since I'm close to my supermarket and drugstore)--but screaming about how stupid you think a perfectly good idea is and screaming about who has the best one-size-fits-all approach when one size DOESN'T are both pointless.
As for nasty comments about Tesla, no surprise. Anyone who knows anything knows who he was and anyone who doesn't makes stupid homophobic comments about 80's hair bands.
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Rich73132#3
Wednesday, September 02, 2009 6:05:35 PM
There is always Hertz or Enterprise to help you make that 775 mile trip. Far better to have a local car for all those countless ours spent in traffic. Even better if it is electric.
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