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Tesla Motors Turns a Profit For the First Time
d0rp writes with news that Tesla Motors has reported earning a profit for the first time in its six-year history. Sales of the $109,000 Roadster earned the company $20 million in revenue, which settled out to $1 million in profits. "Most of that money rolled in after Tesla delivered cars customers had already placed deposits on. Although the company has, according to spokeswoman Rachel Konrad, seen a 'surge' in orders for the Roadster and the higher-performance Roadster Sport (price: $127,500), it isn't likely to keep rolling cars out so quickly. Konrad says Tesla is 'definitely on pace' to meet its goal of 1,000 to 1,200 cars a year but didn't say when that might happen. Tesla has so far delivered about 609 Roadsters since production started in March, 2008." The company is working on a new 'Model S' sedan, with the help of $465 million in government loans, and has also entered into a partnership with Daimler to help the German auto company produce electric Smart cars.
This should be taken with a bit of skepticism. There's a difference between positive cash flow (more cash coming in than going out), positive net income (what most people think of as 'profit') and positive EBITDA (earnings before interest, taxes, depreciation, and amortization, or profit from operations). TFA doesn't mention which Tesla is reporting.
How about the sub $20K, 100 mile Aptera 2e? (Or if you wait until 2010, the hybrid model that goes 600 miles on one tank?)
http://en.wikipedia.org/wiki/Aptera_Motors
They aren't getting the loan for making more Tesla Roadsters... but for their new Tesla Model S sedan. Which is a lot more affordable (and useful) than the Roadster. Still more pricey than a normal car, but it's definitely going in the right direction.
It could even be a hit here in Norway, as it will be exempt from all normal car taxes (which easily make most cars 2 times or more expensive than in the US) - it will even be exempt from the VAT (25%). Exporting US cars again would be nice, wouldn't it?
Tesla also has a revered brand for which people are willing to pay.
On the manufacturing side they are some advantages as well. They have very few long term commitment contracts with suppliers who make parts that are irrelevant to electric cars. They are very few if any long term commitment contracts to labor organizations to keep organizational charts wide and heavy. They have few if any long term contracts with city, county or state governments regarding factory locations or employment levels. They have few if any long term leases on land and facilities that must be used or create a financial drag on the organization. They have few if any dealership agreements with odd inventory management clauses that cause inconsistent and inefficient bullwhip effects through the entire supply chain. They have few if any contracts with top executives who demand lavish lifestyles or are ineffectual without hundreds of subordinates that somehow make things happen in spite of their ignorance and egos.
On the down side, they do not have a manufacturing plan or a well built organization to support such a plant. With the big automakers suffering Tesla will likely get to pick the cream of the crop of executives and management to create this without falling into many of the pitfall often plagued by young organizations.
-rd
The infrastructure is already in place in some cities. In Los Angeles, where I expect to see more than a couple of Teslas on the road, there have been signs for electric vehicle charging stations all over the place for years.
http://twitter.com/OLDTELEGRAM
Maybe not, but it will sure solve a lot of smog problems out here in Southern California. We get our power from natural gas, nuclear and a little bit of hydro and wind. The smog is from the cars.
http://twitter.com/OLDTELEGRAM
No need to fight wars for a nuclear, or solar or wind energie or geo-energie.
That is the beauty of the electric grid. it don't give a damn what you hook up to it.
Petrol cars run on petrol.
Electric cars run on anything that pump out juice.
MMO Quests are like orgasms:
You may solo them, I prefer them in a group.
They've spent far less money than GM spent on the EV-1, and have almost as many cars on the road. About 1100 EV1 cars were produced.
The current version of the Tesla roadster is a reasonably good sports car. Speed is good, acceleration is very good, the range is 200 miles, and it looks good as it whooshes by. It's overpriced, but there's hope of getting that down as volume goes up.
They had some initial problems stemming from trying to make it go fast. First they had motor overheating problems at high revs, so they put in a two-speed transmission. That was a disaster; shifting under load ate up the transmission because the two speeds were too far apart. Then they went back to a simple single speed transmission, but water-cooled the motor, which simplified the mechanics and got them the desired top speed. The current drive train seems to be holding up well. Top speed is only 125MPH, which is low for $100K+ sports cars, but few customers really take their Ferraris to a track anyway.
I see Teslas on the road almost daily. I live near the Silicon Valley dealership and on a road the sales reps use for demos. They change lanes very smoothly, with all that battery mass holding the center of gravity down.
Why should I pay taxes to give $465 million dollars to a company that GROSSES $20 million a year?!
Ideally, the company will make enough of a profit in the future (I'm using the old-fashioned definition of "future" of a few to maybe even 20 years, not the new corporate definition of "this quarter") that they can pay back that loan. Not quite as ideal, but still not bad, is that even if they don't end up paying back the entire loan, the technology that comes out of it will save more than $465 million in fuel use and environmental cleanup. Whether or not either of these outcomes actually happens, of course, remains to be seen.
That 465 million dollar loan can lead to billions in business for 50+ years. Would you think that's worse than giving a dying company billions?