Commentary: Tesla Model S & The Future of the Company

The Model S definitely is shaping up to be the make or break car for Tesla, and the true test of it's real developmental abilities. There has been some information circulating that Tesla plans to unveil the car at a event next month. Let's hope that proves true!

Not a whole lot is known about the Model S other than the information released by the company. The Roadster currently gets 220-miles on a charge, the highest range of any production electric vehicle. However, given the Model S's asking price is nearly half what Tesla is asking for the Roadster, the standard pack on the Model S will be a 150-mile range unit. 

Also optional in place of that will be a 300-mile range pack that sounds much more appealing for use as a "real" vehicle. I suspect most buyers will opt for the higher range model.  In addition to this, Tesla is also working on making the battery packs capable of being swapped quickly for a recharged one (Project Better Place, anyone?) as well as a high-speed charger that will charge the battery in 45 minutes. 

Tesla plans for the car to be built to be built at a new headquarters and production facility in San Jose, California, capable of producing 20-30,000 Model S's per year by 2011. However that plant, along with the entire Model S program, is dependent on Tesla's application for federal loan guarantees from the U.S government.

One of the things that resulted from Tesla's cash crunch last fall was the realization of the benefits from cooperation with established automakers. Coming from that, Tesla struck a deal with Daimler to build powertrains, battery packs and chargers for 1,000 Smart ForTwos. Tesla says their powertrain business is already profitable and they're actively seeking out other potential customers for their technology.

An interesting drama to see over the next few years will be how the rivalry between Elon Musk (Tesla Motors) and Henrik Fisker (Fisker Automotive) plays out. Tesla filed a lawsuit against Fisker last year after hiring him to do design work on the Model S. While in contract with Tesla, Henrik Fisker set out to produce his own battery-powered sedan, the Fisker Karma. Tesla alleged in the lawsuit that he learned trade secrets while under contract and produced substandard work on purpose, essentially sabotaging the project. 

Some within Tesla disparagingly refer to Fisker's work on the car the "White Whale", a play on the Model S's "White Star" codename within the company. So, despite some different approaches both in powertrains (The Karma is a range-extended electric vehicle) and developmental philosophy, the ordeal put the two companies head-to-head rivalry. Tesla Model S vs. Fisker Karma, sounds like a real fight!

At the time of the Fisker contract, Tesla had no in-house design team. That changed with the hiring of former Mazda Chief Designer Franz von Holzhausen, who now as Tesla's Chief Designer, is charged with creating a design team to give Tesla cars a distinct look. The snagging of von Holzhausen from Mazda was a big development for Tesla, bringing even more talent and credibility on board with the company. I'm curious to see the new look of Tesla displayed on the Model S. I expect it to be an amazing vehicle!

Over the years, the story of Tesla has been fascinating to watch. It will be a true feat for the company to get such a large project like the Model S out the door. The car business is extremely tough and you have to wonder how they plan to make money with the large investment required to produce the car, espessially when considering it's relatively low asking price. Tesla insists they can do it though, and right now they have a competent, dedicated CEO at the helm.

I have a lot of confidence in Tesla's CEO Elon Musk, who is personally invested in the company succeeding and seems to be taking the right moves to get the company on track. Hopefully, the U.S government will be smart and recognize the benefit of helping to foster new industry and automotive advancement by granting the loan request.

Otherwise, the Model S project and the San Jose plant will be put on hold until significant investment capital can be raised. Seeing a new, electric-only American car company survive and thrive seems close to impossible. If there's anyone can do it though, it would have to be the team at Tesla.