Tesla Motors To Suspend Roadster Production 401
Wyatt Earp writes with news that a recent SEC filing from Tesla Motors revealed the company plans to stop production on its electric Roadster (and the Roadster Sport as well) in 2011. This will leave the automaker without any cars to sell until the launch of its Model S sedan (financed in part by $465 million in DoE loans) in 2012. Tesla plans to resume production of Roadster models "at least a year" after the Model S arrives. From Wired's Autopia blog:
"'As a result, we anticipate that we may generate limited, if any, revenue from selling electric vehicles after 2011 until the launch of the planned model S,' the company says in the SEC filing. That may not be a problem if S production starts on plan and goes off without a hitch, but if Tesla hits any snags, things could get ugly fast — a point it concedes in the filing. 'The launch of the Model S could be delayed for a number of reasons and any such delays may be significant and would extend the period in which we would generate limited, if any, revenues from sales of our electric vehicles.'"
Uh oh (Score:2, Insightful)
Let's hope they don't screw the pooch... We need companies like Tesla to prove electric cars can be viable alternatives to prevalent gasoline vehicles...
Re:Uh oh (Score:5, Insightful)
There isn't anything for them to prove. They aren't an alternative.
It's either price or range. Can't have both. I'm not spending $50k+ on a vehicle and I'm not driving one with less than a 300mi range.
More Publicly Financed Toys for the Wealthy (Score:5, Insightful)
Re:Uh oh (Score:3, Insightful)
I agree with you, but I would qualify it by saying that they are not an alternative "right now"; hopefully the price will go down and the range will go up as technology improves over time. Right now you are paying more money for less car with electric-only vehicles.
DoE loan (Score:5, Insightful)
Taxpayer bears the risk of default, Tesla execs get to keep any windfalls of development, all the while drawing their salary against the loan. Doesn't sound like the best deal for the taxpayer to me.
Re:More Publicly Financed Toys for the Wealthy (Score:3, Insightful)
Re:Uh oh (Score:5, Insightful)
http://www.bts.gov/publications/bts_special_report/2007_10_03/html/table_02.html [bts.gov]
not very recent, and does not answer the question of how often very long trips occur, but still, range does not seem to matter a whole lot.
I think the issue is more about getting to a point where it makes economical and practical sense to have an electric car for daily use, and rent a fuel car for longer trips.
Re:More Publicly Financed Toys for the Wealthy (Score:1, Insightful)
one could see it as a long term investement. Testla will make the tech more mainstream, simply by producing "many" cars. This will lower the price for similar cars for the average person.
So one could see that investement as a R&D investement
Re:More Publicly Financed Toys for the Wealthy (Score:5, Insightful)
Agree, and strongly disagree.
"Cars are a niche, people will always ride horses for transportation."
"Computers are a niche, they take up a whole room, there isn't really demand for more than six or so of them."
"Planes are a niche, they're useful in war but that's about it."
We the taxpayers should finance this company, and not bail out the "big 3" (two, really, Ford didn't need as much help), because they're proving that they can make something revolutionary that will work its way down to being affordable to everyone. The big 3 are just doing more of the same. And slower.
And besides, it's not a gift, it's a loan.
Re:More Publicly Financed Toys for the Wealthy (Score:5, Insightful)
Well, if it was generally that easy, I'm sure they would have done it sooner. The fact of the matter is, for any startup, you need to target the rich to not only bring down the price of economies of scale, but to pay off for the R&D initially. Yes, there's still R&D going on, but their biggest hurdles are out of the way.
To suggest that they're just a boutique manufacturer for only the wealthy shows ignorance on your part. That isn't their primary goal. Their primary goal is eventually make an affordable electric car for everyone that has style, performance, and still have the vehicle give a good range. They've done the really expensive car. Now they're doing the sort of expensive car. Next they'll do the even cheaper version. This has been their stated road-map for quite some time.
Besides, the government subsidizes all sorts of things, some things I'm sure you couldn't initially afford until cheaper variants came out. Are you against that too?
Re:I don't get it. (Score:5, Insightful)
Its a brilliant business model: Sell $2 million worth of roadsters to generate publicity and get the hang of building electric, get a 400+ million dollar low interest loan, throw the dice on getting a product out and if you win you're rich. If you lose declare bankruptcy and retire on the salaries you paid yourself from the loan.
If they tried to actually build cars they might get another $2 million in revenue which might get them one million in cash flow but it doesn't even compare to the $400 million they can play with courtesy of the government and it distracts the company from paying attention to the $400 mill project.
These guys are brilliant hypesters with good government management skills.
Re:More Publicly Financed Toys for the Wealthy (Score:2, Insightful)
Tesla is a niche and it will always be niche.
I do not agree. They started business as a niche product with the aim of introducing products at a lower price point that could sell in larger volume. That cannot be done in one huge step. If they succeed with the S model, the next model will be higher volume and lower cost.
Re:More Publicly Financed Toys for the Wealthy (Score:3, Insightful)
The Tesla model S sedan will retail for $50,000+ which means that less than 20% (and that is being very generous) of Americans will be able to afford this car.
We're talking about a group of people who tend to buy luxury cars with poor mileage, so it's a good idea to get them into something efficient. These are also the people that others want to emulate; if the roadster is any indication, the Model S will be driven by celebrities first. Cigarettes became popular in the USA only after the smoking industry paid Hollywood to include smoking scenes in movies. The same is true of Diamonds, which are a semi-precious stone whose supply is controlled to make it precious.
Tesla is a niche and it will always be niche.
ESL?
Why should the taxpayers be financing car production by boutique manufacturers for wealthy people?
They shouldn't be. However, taxpayers have actually financed limits on emission controls: California had a master plan for forcing automakers to produce less-polluting cars, and the federal government threatened to sue California if we did so. As a kid I used to be against smog laws. Then I grew up a little and woke up to the fact that everything we do affects someone else, and that my convenience or taste in autos should not impact another's breathing. Right now I'm in Panama, where there are no emissions controls. Cars with 2.5 liter or even smaller diesels put out dramatically more unburned hydrocarbons (and presumably, every other kind of pollution) than my 7.3 liter IDI diesel, in my 1992 F250. I've had a low-grade persistent cough since I got here, and it has only gone away since coming to Bocas town, on an island peninsula. The big difference here is the lack of cars; there's hardly any here because nothing is very far from anything. Another big difference of course is the lack of burning; it's not so agricultural here, and what there is isn't handled in the "green revolution" factory farming manner, it's more natives picking [naturally] organic fruit. Now I love emissions laws, even the periodic retesting.
Where does this rant lead? The benefits from Tesla motors are twofold. One, we're getting EV research at what is probably the bottom dollar. Two, we're getting EVs into the hands of some of the most influential people in the world; those persons who the whole world sees in the media. This will necessarily have the result of increasing demand for EVs.
If the government subsidizes heavily so that average people can buy this particular car then you have to explain why the government should be in the business of picking winners and losers in the market for private automobiles.
The public has never demanded accountability for subsidies before, why would they start now?
Re:Killing yourself with good intentions (Score:2, Insightful)
Re:More Publicly Financed Toys for the Wealthy (Score:3, Insightful)
If the banks are such good investments, why can't they raise their billions and billions dollars instead of completely unconditional loans and gifts from the government?
The biggest difference I see, is that Tesla has a viable business model, whereas the banks' business models seem to be "siphon money into CEO's pockets". Granted, that's a pretty viable business model for the CEOs, but not really for anyone else.
Re:More Publicly Financed Toys for the Wealthy (Score:3, Insightful)
The Tesla model S sedan will retail for $50,000+ which means that less than 20% (and that is being very generous) of Americans will be able to afford this car.
True, but a "sports car" is not what everybody wants anyway. And, have you priced a full-sized SUV recently? Saddly, many people spend close to 50k for conventional gas / disel "family" vehicles.
Re:More Publicly Financed Toys for the Wealthy (Score:5, Insightful)
The Tesla model S sedan will retail for $50,000+ which means that less than 20% (and that is being very generous) of Americans will be able to afford this car. Tesla is a niche and it will always be niche. The best that they (and the taxpayers) could hope for is for them to be bought by one of the major auto manufacturers. Why should the taxpayers be financing car production by boutique manufacturers for wealthy people?
It's new technology; even if this model never takes off the expertise can spill over. It's not like giving money to Ford to keep more Mustangs on the street. It's a potential benefit even if the parent business fails.
It's a pretty good way encourage technology development. A lot of private people think they may be able to make it profitable eventually, they've put in their money, so the government leverages work that may prove valuable beyond the short-term by giving loans. No new government buildings needed, no new bureaucracy you can't kill.
I don't know enough about Tesla or the industry to say if this particular one is the best use of money, but it's not unique or anything. Corporations often get subsidies for new tech; basic research just doesn't get done at measurable levels these days in private industry. Bell Labs isn't what it used to be.
If the government subsidizes heavily so that average people can buy this particular car then you have to explain why the government should be in the business of picking winners and losers in the market for private automobiles.
The "picking winners and losers" thing has really become a meme. Government policies necessarily determine winners and losers all the time, of course, with zoning laws, housing subsidies, mileage standards, public roads, wars for oil, leasing out of federal land, tarriffs, and so on.
If we (ie, the people through the government) chose to spend massive subsidies on electric cars, it would be because we thought the benefits (noise, local pollution, energy flexibility, global warming) outweighed the costs. We'd be saying that cars that spew out those pollutants are "losers," and it's worth paying for them to get off the roads. That is fundamentally a government business--making decisions about the common areas in communities.
If Tesla is such a good investment then why cant they raise $450 million from the private equity market instead of from taxpayers; 99% of whom will never sit behind the wheel of a Tesla?
Because, obviously, a good investment for the government is not the same as a good investment for a private investor. We don't expect corporations to identify candidates in kindergarten and pay for their schooling through 12th grade and college. They'd never get their money back, at least not in a free labor system, but society as a whole benefits.
Your points are really all cookie-cutter stuff, by which I mean they apply to any government intervention, not just Tesla, not just for putatively rich people. But even in freshman college micro-economic models, concepts like externalities might justify state intervention, and in the real world, actual or de facto subsidies for other industries require it. Given this specific intervention is a loan, not some recurring grant and not regulation, which will let the company live or die in the market (as evidenced by the actual story), do you have any actual reason to oppose *this one*, and not just all?
Re:DoE loan (Score:3, Insightful)
Taxpayer bears the risk of default, Tesla execs get to keep any windfalls of development, all the while drawing their salary against the loan. Doesn't sound like the best deal for the taxpayer to me.
Geeze dude, you make them sound like the American banking system. They aren't that bad, they might actually produce something useful, that being cars.
Re:More Publicly Financed Toys for the Wealthy (Score:3, Insightful)
And besides, it's not a gift, it's a loan.
No, it's a gamble. If the company goes bankrupt, the loan will never be repaid so it retroactively becomes a gift. I'm fairly sure that people gambling with other people's money was one of the causes of the current financial mess...
Re:Uh oh (Score:4, Insightful)
My Grand Prix only has about a 300 mile range of city driving, but the advantage is that I can replenish its fuel supply in about 5 minutes at any number of fueling stations located strategically throughout the city. With the electric car, when your battery is dead, it's dead and you're going to be spending hours, or perhaps all night, waiting for it to recharge. That's not a viable alternative to gasoline-powered cars in my opinion.
Re:Quixotic business plan (Score:5, Insightful)
Energy density of lithium batteries: 1 megajoule/kg
Energy density of gasoline: 45 megajoules/kg
That's a slightly misleading statistic, because it doesn't include the mass of the engine or drive train in the calculation. Electric cars are much simpler mechanically. You need to compare the mass of fuel, a fuel tank, engine, gearing, and drive train to the mass of batteries plus electric motors and then see how much power you've got for both. The electric car comes out a lot closer when you do this.
Then you need to factor in the fact that you can charge an electric car at home. How many trips does a tank of petrol give you? A week's worth of typical driving? Then if your electric car has only half of the range but can be charged overnight then it's competitive.
Finally you need to compare the cost of the energy and the efficiency of generation. Energy conversion from chemical potential energy a battery to kinetic energy via an electric motor is a lot more efficient than converting hydrocarbon fuel into kinetic energy via an internal combustion engine. Electricity can come from burning hydrocarbons, but it can also come from things like solar, nuclear, wind, hydroelectric and tidal power. Technology keeps making these forms of power cheaper, but scarcity keeps making hydrocarbons more expensive. When 1MJ of petrol costs twice as much as 1MJ of electricity, it makes a difference. Petrol sold in the USA is about 36.6 kWh/US gal, so at $3/gallon that's 0.08 cents per kWh. That's pretty close to the cost of electricity. Once you factor in the relative conversion efficiencies, you pay a bit less per unit of kinetic energy from an electric motor than you do from an internal combustion engine at $3 per US gallon of petrol. When petrol hits $5 per US gallon (which is cheaper than it is in the UK) then it's a lot more expensive than electricity.
Spoken like a city boy (Score:2, Insightful)
"and practical sense to have an electric car for daily use, and rent a fuel car for longer trips"
And that doesn't really make sense for a huge part of the country where we go to the store once a week for food, and fill up a van. We have to haul stuff to our property to maintain buildings, fields, etc.
I said "city boy" and I'm joking a bit. But I'm doing that show you that the way you live and where you live is up to you and is neither right nor wrong. Please give everyone else the same benefit of freedom to choose where and how they want to live
Re:Uh oh (Score:3, Insightful)
It's not corporate welfare. It's the government allowing the companies to benefit from the relatively (compared to the status quo) positive impact electric cars have on the environment. Without these subsidies and without similar taxes on gasoline cars, gasoline cars will have an unfair advantage since some of the cost of the cars (pollution) is offloaded onto all of society.
Re:Spoken like a city boy (Score:2, Insightful)
By 'huge part of the country' I assume you mean by area, not population. And he said 'car' not 'truck' or 'van', which serves a different purpose (carrying things as opposed to carrying people). Now you may only have a van or truck for financial and convenience reasons, but when someone defines their market, and you then say 'but there are other markets' as your counterpoint...it isn't really germaine.
Re:Uh oh (Score:2, Insightful)
Re:Uh oh (Score:5, Insightful)
Yeah, but like 90% of Americans travel less than 25 miles a day for their commute. For the minority who do need to be able to travel hundreds of miles, then an electric car isn't for you. But for the rest of the crowd it's perfectly fine.
The "limited" range is a just another tactic by the oil and car industry to keep these things from ever getting popular. If your job is a 5 minute drive away and you make a weekly grocery trip 15 minutes away, why the Hell would you need a car with a range of 300 miles? Vacation/family trip, rent a car, take a train, bus, etc.
The range isn't going to improve if people don't buy the damn cars to help fund R&D - with real-world data as well - for future generations.
Re:DoE loan (Score:3, Insightful)
Today, it probably WOULD come from COAL.
Which still mostly mined in the United States (at least US consumption is). Hence, we would not be dependent on other countries for price stability. Also, most of the charging would probably be done at night, so more of our power plants could operate more efficiently and electricity would become cheaper.
Also, electricity is the only viable means right now of in the future producing sustainable transportation. The two steps to do this would be to make our cars electric and make all our powerplants sustainable. There are a lot of incentives right now for power companies to produce electricity sustainably, so very gradually more of our power grid is becoming sustainable. Are you suggesting that we don't also start the gradual process of switching cars to electricity now?
Re:Spoken like a city boy (Score:3, Insightful)
Slow down, cowboy! (see what I did there? ;) Nobody in this discussion is looking to prevent you from driving whatever you like, living wherever you like, or living however you like. Let's recap.
An AC said that we need Tesla to prove that electric vehicles are a viable alternative to gasoline vehicles. Another (presumably not the same..) AC said that EVs are not a viable alternative because they either cost too much or have too small of a range. Then obarthelemy cited a study and claimed that the study indicates that range is not actually that important, and that we should mostly worry about the economics and practicality of a particular vehicular usage scheme.
Where in this is obarthelemy, or anyone else, denying or attempting to deny you the freedom to choose your lifestyle? If you don't feel that EVs are viable for you, then don't use them! Do you feel that the presence of alternatives is a threat to your lifestyle? If not, then you should absolutely support the development of alternatives for a variety of reasons that should be pretty obvious.
Re:How often is often? (Score:3, Insightful)
Re:Quixotic business plan (Score:3, Insightful)
if one is in the business of long distance trucking then the downtime for refuel is going to become an issue.
If you're in the business of long distance trucking, then the vast majority of our ICE vehicle fleet -- the part that EVs are aiming to replace -- is completely inappropriate for you to begin with! Yeah I don't think truckers are going to be driving the Tesla Model S, and I don't think anyone has been implying that they would.
For the people who only need a commuter car, a pure EV is imminently practical to operate. Personally I'd love to be able to plug in my car every night and know I had a its full range the next morning. Yeah, today I only need to fuel up every two weeks but there's always that one day or two where I'm deciding whether or not to go out of my way to refuel or risk running on fumes the next day. If "refueling" was as simple as pulling into my home and plugging in, I'd never have to worry about that again. The only reason refuel time matters for these people is because they're having to do it at a gas station.
And for the people who mostly only need a commuter car, but have to drive farther often enough that rental isn't a practical option, there's always the in-line hybrid design. Pure electric drivetrain with an ICE generator 'range extender' that is optimized for that purpose. Whenever you aren't needing the range, it is a pure EV.
This is the perfect stepping stone imo. I even bet that once people start using them and realize they really don't need the range as much as they thought, they'll be more willing to by a pure-pure EV the next time.
Pure electric vehicles will remain in the realm of curiosities, luxuries, and niches unless we find some unobtainium to recharge the batteries.
I'm waiting for an unobtanium cluestick for people who can't envision doing things even the tiniest bit different than they do now.
Re:More Publicly Financed Toys for the Wealthy (Score:3, Insightful)
No, it's a gamble. If the company goes bankrupt, the loan will never be repaid so it retroactively becomes a gift. I'm fairly sure that people gambling with other people's money was one of the causes of the current financial mess...
Every loan is a gamble in the sense that is might not get paid back. That's part of the reason you charge interest. You do your due diligence, diversify your lending and presumably you mitigate the risk. And yes, loaning other people's money is pretty much the way it's done. There's nothing inherently problematic about that. The practice isn't exactly new either. Remember the "Parable of the talents" from the bible? The boss man returns from his travels to find that the "worthless" servant has buried the money he entrusted to him: "Thou oughtest therefore to have put my money to the exchangers, and then at my coming I should have received mine own with usury." [KJV -- which I chose for the word "usury"] I bring this up not to suggest that Jesus was a capitalist tool, but just to illustrate that the practice of loaning out other's money has been going on long enough that it would be so familiar eons ago as to be used metaphorically
Making loans, or even loaning out other people's money isn't a recipe for disaster. Failing to due proper investigation into the loan application and not evaluating whether the risk is acceptable, when widespread, is.
Perhaps that's what you meant, that this particular loan is a gamble, and lenders taking undue risk recently were gambling too. Well, in that case I'm just preaching to the choir, not to mention being redundant.
Re:BEAUTIFY SLASHDOT! (Score:1, Insightful)
(...)you arrogant douche-bag.
Um, from what I see, the entire slashdot community is made up of arrogant douche bags.
Re:Uh oh (Score:3, Insightful)