For some time now, Tesla Motors has been the darling of the luxury electric car market and while many electric car enthusiasts have looked on from a distance, few have been able to afford the vehicles on offer so far. However things seem to be changing, with Tesla CEO Elon Musk confirming that the company has plans to release an affordable electric vehicle within three or four years.
This is not the first time that an "affordable" electric vehicle has been associated with Tesla but it is one of the very few times that the company has been willing and able to comment upon these rumours. It seems almost inevitable that the company will enter the "mass market", which could conceivably take the electric car market to a different level.
Tesla is the most technologically advanced electric car manufacturer in the world today, with the ability to bring together the latest technology and latest battery power and put this into vehicles which are affordable to those on higher incomes but not extortionate. On the other side of the coin, Nissan has made great progress with the Nissan Leaf although Elon Musk described this as affordable but lacking in quality.
If Tesla is able to reduce the cost of its groundbreaking technology and incorporate this into more "mass market" electric vehicles then this could certainly take the company into a totally different area of business.
No government debt
While today we hear news that Better Place, the electric car battery swapping service, has called time on its business after burning around $850 million, the news from Tesla is perhaps a welcome relief. Just a few weeks ago we also had the debacle with Fisker which is effectively on the verge of bankruptcy, owing the US government over $170 million.
Quote from ElectricForum.com : "Tesla has given its strongest hint yet that with 4 years the company will have a $30,000 EV available with a 200+ mile journey capacity."
On the flip side of the coin, Tesla has repaid its original $465 million federal loan nine years early and is now free from federal debt. This leaves the company with more leeway with regards to future strategy, future spending, and future markets. The company does not have the U.S. government looking over its shoulder and dictating payment terms, although the likes of Daimler and Toyota do have significant shareholdings in the company.
The future of Tesla Motors
The very fact that the Tesla has been able to pay off its federal loan early has not gone unnoticed and indeed there is even speculation that the company may well be acquired by a large automobile group. However, CEO Elon Musk believes that if the company was to be acquired, then it would be by a cashrich company and he even went as far as to name Apple as a possible bidder.
It is difficult to pinpoint exactly how Tesla has been able to succeed where so many others have failed and in some ways it would be disappointing to see the group lose its independence. It is this independence which has allowed the company, under the stewardship of Elon Musk, to go from strength to strength, to be controversial and take risks - would these opportunities still be available as part of a larger group?