Tag archives for Luxury
The Tesla Model S is officially showroom ready, at least according to the U.S. government: after passing initial Environmental Protection Agency tests, the car has also reportedly passed crash testing at the hands of the National Highway Traffic Safety Administration. Not one to waste time, Tesla Motors subsequently announced the car’s initial delivery date is June 22nd, 2012.
The crash test announcement comes from the personal Twitter account of Tesla CEO Elon Musk, who took a break from observing his SpaceX rocket launch to tweet that the Model S finished NHTSA crash testing. Musk claims that the car completed all tests with five-star scores, although we were unable to independently confirm that claim with NHTSA by press time.
With crash testing completed, along with the aforementioned EPA certification, it appears to be full-speed ahead for Tesla’s next model launch. The company plans on handing over keys to early production models to owners within the confines of its assembly plant in Freemont, California, but then intends on quickly ramping up volume. Tesla hopes to deliver 5000 Model S sedans by the end of the year, but claims that the waiting list for one of the five- or seven-passenger (depending on options) EVs stretches some 10,000 names. Those names should be satisfied by the middle of next year, as Tesla is shooting for a 20,000-unit year in 2013.
As to-be owners anxiously wait for their cars, Tesla also announced that customer cars will receive some special finishing touches. Tesla VP George Blankenship announced via blog post this week that Model S sedans will now come with adjustable steering effort, suspension height, and regenerative braking settings – all of which are configurable through a menu accessed by way of the 17-inch touchscreen center stack.
The Model S will go on sale this year and cost between $57,400 and $105,400, not including a possible $7500 federal income tax credit.
By Ben Timmins
The 2012 loss grew some $141.8 million over the company’s 2011 losses, bringing the red ink to a total of $396.2 million. According to Automotive News, “manufacturing and supply chain inefficiencies” were behind the fourth-quarter loss of almost $90 million, which was up by $8.4 million over the same period in 2011.
Indeed, the automaker says much of its red ink stems directly from ramping up production of the Model S sedan, the company’s sole product at this point in time. The company says it is now churning out 400 units a day, and is allegedly on track to build roughly 20,000 copies by the end of 2013.
The negative numbers don’t seem to have placed a damper on Tesla’s outlook. CEO Elon Musk stated during the company’s earnings call on Wednesday, “We really have a very high confidence that we will have a profitable first quarter, and this is the very first quarter that we have been at our target production rate.” It’s because Tesla has only just gotten up and running with its 400-unit-per-day rate that we don’t have full sales numbers yet; the company is still working through a backlog of orders on the Model S – unsurprising, given how impressed we were when we named the Model S our Automobile of the Year. That said, it still reported sales of 2400 cars in the fourth quarter of 2012 and has grown its international store total to 32. A total of 2650 Model S cars were sold in 2012.
Tesla is aiming to increase its global retail footprint to 52 stores by the end of this year, and also hopes to roll out a leasing program for the Model S and to continue expanding its Supercharger network. Musk stated that the expansion plans will only help to propel the company’s growth, as it currently has “over 15,000″ reservations for the Model S and expect to post a quarterly profit for Q1 of 2013. Ambitious goals, and we’ll have to wait and see how they shake out over the course of 2013.
Sources: Telsa, Automotive News (Subscription required)
In stark contrast to the woes faced by other upstart plugin auto brands Coda and Fisker, Tesla seems to be resolute and resilient in its business strategy. The company is so confident in its success, that it released a statement on the company blog that it intends to re-pay its Advanced Technology Vehicle Manufacturing loans five years ahead of schedule. This would put the final payment of the loan in 2017, as opposed to the original deadline of 2022.
In the heated political climate surrounding government-subsidized green energy initiatives, the company was quick to point out the that ATVM loans were initiated and approved under the Bush administration, and were completely separate from the federal bailout of General Motors and Chrysler, as well as being the smallest of the ATVM loans granted, the others being Ford at $5.9 billion, Nissan at $1.4 billion, and Fisker at $529 million. Tesla’s loan was for $465 million.
In the blog post, Tesla’s VP of Business Development, Diarmuid O’Connell, said the company expected to show a modest profit in the first quarter of 2013, excluding non-cash option and warrant-related expenses.
The company’s upcoming models were briefly mentioned in the post, including the Model X crossover, and the third-generation model, described as a high-volume, low-price model, sometimes referred to as the “Blue Star.” During its development, the Model S was coined the “White Star” by many automotive media outlets.
However, being a publicly-traded company, Tesla is under the scrutiny of investors and regulators, and announced that its annual report would be delayed due to errors in its filing, according to Bloomberg. Some unpaid capital expenditures from 2011 and 2012 will be re-classified as operating activities in the revised report.
Source: Bloomberg, Tesla
Tesla is preparing to deliver its first Model S electric sedans to customers next month, but in the spirit of full disclosure, has outlined why it anticipates its 300-mile version will be rated by the EPA for 265 miles.
The Model S’ drawn-out unveiling has ingrained three specific driving ranges related to battery size – 160, 230, and 300 miles – but the EPA will have its own stamp of approval. An official blog bylined by CEO Elon Musk and CTO JB Straubel dives right into the matter, presumably foreseeing questions and concerns about the 35-mile disparity with the farthest-traveling selection.
The difference between 265 and 300 miles extracted from the Model S’ substantial 85-kilowatt-hour lithium-ion battery comes down to the EPA’s testing methodology. The stated 300-mile range with the highest-capacity battery was always Tesla’s target. From one perspective, it has actually exceeded the mark, claiming 320 miles under the EPA’s old 2-cycle fuel economy evaluation. It’s when the EPA’s updated 5-cycle test enters frame that “265 miles” rears its head. For comparison, the 245-mile-rated Roadster and Roadster 2.5 endured the elder cycle while the Nissan Leaf has a 73-mile range under the 5-cycle assessment.
Going from the 2- to 5-cycle test can drastically impact vehicle ratings. The simpler 2-cycle had an approximate weighting of 55-percent city and 45-percent highway use; the more comprehensive 5-cycle is more representative of 43-percent city and 57-percent highway driving. The certifications are run on dynamometers, and the specifics are as follows:
1) Federal Test Procedure: 2-cycle, 5-cycle
2) Highway Fuel Economy Driving Schedule: 2-cycle, 5-cycle
3) Cold Federal Test Procedure (run at ambient 20 vs. 75 degrees Fahrenheit in standard FTP): 5-cycle
4) SC03 (air conditioning test at ambient 95 degrees F): 5-cycle
5) US06 (aggressive acceleration test, up to 80 mph): 5-cycle
Exactly how much the 85-kW-hr battery’s claimed range figures matters will likely be determined as Model S driving impressions roll in from customers and media outlets.
Tesla hasn’t disclosed its anticipated EPA ranges for the 160- and 230-mile batteries, but a 12-percent loss like the 300-mile option would peg them at a predicted 141 and 203 miles under the EPA 5-cycle, respectively. The 160- and 230-mile estimates from the respective 40- and 60-kW-hr packs can be achieved from a steady 55-mph cruise, per Tesla spokesperson KC Simon.
Interestingly, the blog gives insight into the Model S’ range and electricity consumption behavior with graphs. These graphs often have little bearing on the real world since Main Street USA is not a laboratory with fixed inputs. Nevertheless, considering the less expensive Model S is considerably heavier, it’s reassuring to see the family-friendly electric four-door head and shoulders above the Roadster from an efficiency standpoint.
The Model S costs from $57,400 (160-mile battery) to $105,400 (Signature Performance model with 300-mile battery) depending on battery size and trim, excluding the highly touted $7500 federal tax credit that gets applied to your income tax return. Depending on your state of domicile, there may be additional state and local tax credits or rebates as well.
By Benson Kong
Tesla has just announced a new finance program, making it easier than ever for prospective buyers to get into a new Model S with no money down and a smaller-than-expected monthly payment.
The program, a collaboration with U.S. Bank and Wells Fargo, works by having the banks pick up the Model S’ 10-percent down payment. The down payment is covered by federal and state tax credits, which range from $7500 to as high was $15,000, if you live in West Virginia. Essentially, the banks are using as a down payment the tax credit Model S buyers would otherwise receive further down the line.
The buyer, who Tesla chief Elon Musk says must have excellent credit, then makes a monthly payment based on a 2.95-percent interest rate. According to Tesla’s math, that could amount to about $500 per month for 66 months for a buyer of a 65 kWh Model S. That figure is all smoke and mirrors, though, as the automaker is taking into account intangibles like the time you save by using the carpool lane or avoiding the gas station.
For example, say you’re a wealthy West Virginian business owner who’s purchasing a new 65 kWh Model S, who drives 15,000 miles per year, and is getting out of a BMW 550i, which nets 20 mpg combined on the EPA test cycle. Right there, Tesla says you’ve netted $267 per month in energy savings if you figure the average price of premium gas over the next three years will be $5 a gallon. Drive your car for business? Deduct at least $200 per month off. Is your time worth $100 per hour? Then you’ve essentially saved $167 by cutting your commute by five minutes every day, using the carpool lane. Under all those conditions, according to Tesla, your monthly payment amounts to just $184 per month. Except it doesn’t. This West Virginian businessman will actually be paying $1051 per month for his Model S. An 85 kWh Model S Performance, the quickest American four-door we’ve ever tested, would really cost $1421 per month, and the regular 85 kWh model goes for $1199 a month. It’s worth noting that the costs of driving a $1400-per-month Model S will almost certainly be less than driving a comparable $1400 per month gas-powered car.
After three years of owning the Model S the owner will have the opportunity to sell the car back to Tesla, for at least the same residual value of an equivalent-year Mercedes-Benz S-Class. At the moment, that value is 43 percent, as long you drive less than 12,000 miles a year. For those concerned about the viability of Tesla in the long run, Elon Musk will pick up the tab in the unlikely case Tesla doesn’t exist after those three years.
Ultimately, this program looks to be a win for Tesla and a way for those who might not otherwise be able to afford a Model S to get their hands on one of our favorite electric cars. As for what’s next from Tesla, Musk promised the automaker would begin holding weekly phone conferences with the press, so stay tuned.
Play with Tesla’s True Cost of Ownership Model S calculator here.
Are electric cars always slow, planet-saving vehicles? Not necessarily. Contributor Ezra Dyer recently pitted a Tesla Model S electric sedan against one of Germany’s hottest performance four-doors — the 2013 BMW M5 — in an impromptu drag race, and the result was closer than anyone expected.
Dyer subjected the two luxury sedans to a 0-to-100-mph drag race at Gingerman Raceway in western Michigan. While we won’t spoil the result, it’s worth looking at how the two cars compare on paper. The 2013 BMW M5 has a twin-turbo 4.4-liter V-8 engine with 560 hp and 500 lb-ft of torque. A seven-speed dual-clutch transmission directs that power to the rear wheels. The EPA says the car swills gas at a rate of 14/20 mpg (city/highway).
The 2013 Tesla Model S Performance uses a rear-mounted electric motor rated for 416 hp and 443 lb-ft of torque. That’s less grunt than the BMW, but the key is that the motor produces all of its torque instantly, whereas the M5′s torque band peaks at 1500 rpm. The Tesla’s electric motor is backed up by an 85-kWh lithium-ion battery that the company claims will allow for a driving range of about 300 miles per charge.
When it comes to price and weight, there’s little difference between the two. The BMW M5 seen here wears an as-tested sticker of $106,695 (after destination) and weighs 4387 lbs, while the Tesla Model S Performance costs $102,270 and tips the scales at 4640 lbs.
So, which will take the drag-racing crown: a twin-turbocharged gasoline performance sedan, or a futuristic electric luxury car? Watch the video below to find out.
By Jake Holmes
If you’re considering a Tesla Model S, now would be a wise time to place your order. The EV automaker has just announced that all reservations placed after the end of this year are subject to a price increase of $2500. The 40 kW-hr Model S, for example, will jump to $59,900. The 60 and 85 kW-hr models will cost $10,000 and $20,000 more respectively. The range-topping 85 kW-hr Performance model will carry a $94,900 price tag.
All Tesla Model S cars with the revised pricing will add as standard equipment 12-way power seats and heated front seats. At a constant 55 mph, Tesla estimates the ranges of the three different motor choices at 160, 230, 300 miles. Claimed acceleration from 0-60 mph times take from 4.4 to 6.5 seconds, though we tested a Performance model completing the sprint in 3.9 seconds.
Tesla notes that the $2500 price increase is half the rate of inflation, and with plenty of press — it was the 2013 Automobile of the Year, after all — luxury customers may still be willing to pay the premium. Speaking of premiums, Tesla is also offering a four-year/50,000-mile extended warranty above the car’s standard four-year/50,000-mile basic warranty.
The automaker has also revealed pricing for battery replacements. Taking the mystery out of the one maintenance detail that scares many about electric cars, Tesla says that $8000 will buy 40 kW-hr Model S customers a new battery to be installed at any time after the eighth year of ownership. The cost rises to $10,000 for the 60 kW-hr battery and $12,000 for the 85 kW-hr battery.
Those battery replacement option prices cover the battery and all installation labor and parts needed to make a Model S whole again. Customers who don’t select the option at time of order will have up to 90 days from date of delivery to choose it, and the prepaid battery will apply to second and subsequent owners even if the original owner sells their car. And while it states the fresh battery reprieve comes after the magic 8-year mark, there “will likely be economic outcomes (incentives or drawbacks) tied to early or late exercise options,” per a Tesla spokesperson.
Considering Tesla’s vehicle servicing strategy, we asked if a mobile battery swap was foreseeable in the year 2020. Representatives seemed amused by our image of an electric-powered box truck with enclosed lift being the 2020 version of the electric-car maker’s Service Ranger, but it appears the B&M route is the safest bet for now.
Benson Kong contributed to this post.
By Zach Gale
Tesla has been making news lately with changes designed to make the process of buying and maintaining a Model S as easy as possible, and now the company says it has completely paid off its Department of Energy loan nine years early. The company had nine more years to repay the loan.
Tesla wired $451.8 million to fully repay the loan with interest, and in a release the automaker says it is the only American car company to have fully repaid the government. Then again, Tesla currently only offers one vehicle, the lauded Model S. The larger and delayed Model X is set to arrive next year.
UPDATE: Tesla isn’t actually the only American automaker to pay back government loans. Chrysler points out that, about two years ago, it paid back government loans to the U.S. and Canadian governments in full. For another perspective on this issue, read this Forbes blog.
So far, Tesla has worked with Mercedes and Toyota, and offered the all-electric Lotus-based Roadster, a car the company says had a 30-percent gross margin. More recently, we’ve heard about the Model S’ improved financing terms as well as a resale guarantee and a lenient warranty update. Next week, Tesla will reveal details on a revised supercharger system. Company co-founder Elon Musk hinted at the announcement on Twitter, saying there may soon be a way to recharge a Model S throughout the country faster than you can fill a gas tank.
The Department of Energy loan fit into the Advanced Technology Vehicle Manufacturing program of which Fisker was also a part. On the original $451.8 million loan, Bloomberg notes that taxpayers will make at least $12 million from the deal. Paying off the loan early was made possible thanks to the roughly $1 billion raised in last week’s new common stock and convertible senior note offerings.
While reaching truly stable financial ground is still anything but a certainty for Tesla, it appears the company is on the right track.
Source: Tesla, Bloomberg
By Zach Gale
Elon Musk has published a thorough blog countering some of the results in a recently published, controversial Tesla Model S review in The New York Times. The review has received plenty of attention, and this week Musk prepared his reply — complete with charts to illustrate his points — on Tesla’s site.
The controversy began when Tesla approached Broder to evaluate a Model S (with an 85 kilowatt-hour battery that provides 265 miles of EPA-rated range) and two new charging stations installed in Newark, Delaware and in Milford, Connecticut. These stations are 200 miles apart and include the company’s new Supercharger, which can recharge batteries at a much faster rate than a typical charging unit (Tesla says the Supercharger can provide up to 150-160 miles of range in just 30 minutes).
In fact, in a February 12 update, Broder says the test was intended to evaluate the Supercharger network on the East Coast, not the Model S, explaining why he didn’t plug in the car overnight in Connecticut.
“This evaluation was intended to demonstrate its practicality as a ‘normal use,’ no-compromise car, as Tesla markets it. Now that Tesla is striving to be a mass-market automaker, it cannot realistically expect all 20,000 buyers a year (the Model S sales goal) to be electric-car acolytes who will plug in at every Walmart stop,” Broder wrote.
Broders Tesla Model S speed log 300×187 image
Broder’s trip began at the Delaware station with 242 miles of range (he was unaware of a “max charge” feature that would’ve topped the battery off at 265 miles). He claims to have experienced fluctuations in the battery’s claimed range, which may have
been affected by the colder temperatures. Still, Broder claims to have properly charged the battery, drove at reasonable speeds, and even reduced the cabin temperature, all in an attempt to increase range. In the end, however, Broder says he ran out of charge before reaching Connecticut, and the Model S was consequently towed to the charging station.
Since then, Tesla has compared Broder’s account to the data log from the Model S test car he drove. Earlier this week, Musk published an extensive blog with that data, which points out a number of claimed discrepancies in the highway speeds at which Broder said he was traveling, charging times, as well as possible errors in his article’s math. Musk also suggested the evaluation was a lost battle for Tesla in the first place, pointing to a March 2012 article by Broder in which he says “the state of the electric car is dismal.”
Check out Musk’s full February 13 blog here, and Broder’s February 12 follow-up here.
Source: NY Times, Tesla Motors
One of the advantages of being the new kid on the block in business is that you often get to approach things in a different way than the more established players in the market, even down to how your products are sold. That’s the approach Tesla took in selling its vehicles, adopting a manufacturer-direct, company-owned store model. But that approach did not sit well with established, franchise model dealers, claiming the company’s model skirts the car dealer franchise laws in some states. The Massachusetts State Automobile Dealers Association in particular took issue with Tesla, and took the automaker to court after it opened a showroom in the Natick Mall.
But Massachusetts Judge Kenneth J. Fishman dismissed the suit, stating “The court is unconvinced that the 2002 amendment to Chapter 93B expanded the purpose of the statute to protect the motor vehicle franchise system,” Bloomberg reports.
Tesla CEO Elon Musk addressed the legal victory by Tesla in a statement: “We are delighted by the outright dismissal of this case, and the validation that we are operating our business in compliance with the laws and expectations of the Commonwealth of Massachusetts.”
But the dealer association hasn’t given up its fight against Tesla entirely, saying it is considering an appeal. “It’s just another bump in the road we have to address,” Robert O’Koniewski, executive vice president of the state dealer association said.