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Electric-car maker Tesla preparing IPO
U.S. electric-car maker Tesla Motors plans to go public soon, two sources familiar with the matter said, amid growing interest in green technology and battery-powered vehicles.
An IPO filing from the 6-year-old start-up, best known for its $109,000 all-electric Roadster, is expected any day, said one of the sources. The person did not give a specific time frame, although IPOs typically take several months.
Tesla spokesman Ricardo Reyes declined to comment on what he called "rumor or speculation."
Tesla Model S(Credit: Caroline McCarthy/CNET)
Tesla would mark the first public offering from a U.S. automaker since Henry Ford's Ford Motor debuted its shares in 1956. The IPO represents a landmark in the resurgence of electric-car technology that most carmakers had dismissed as impractical until recently.
The company's chairman Elon Musk said early last year that an IPO was a possibility in either late 2008 or 2009.
But the financial market turmoil following the collapse of Lehman Bros. in the latter half of 2008 virtually shut down the IPO market. The appetite for IPOs has picked up since mid-September this year with a robust pace of new filings.
Tesla's IPO would follow the successful debut of lithium ion battery maker A123 Systems, whose shares rallied 50 percent on their first day of trading on September 25.
Analysts have said that the success of A123, the first green-technology IPO this year, would encourage more venture capital-backed green companies to go public.
Tesla will compete with established automakers like Ford, General Motors, and Nissan Motor, all of which are racing to launch electric or plug-in hybrid vehicles. Tesla, by contrast, is a small player with a high-end market and limited production.
A combination of factors has driven the recent interest in developing electric, or partially electric vehicles, including the Obama administration's push to have 1 million rechargeable vehicles on U.S. roads by 2015 and low-cost Department of Energy loans for manufacturers.
Venture funds back green cars
The carmaker is developing a second, lower-cost model, an electric sedan known as the Model S, which will have a base price of $49,900.
Tesla said in September it delivered 700 Roadsters since February 2008. The Roadster, which is built on a Lotus frame, can go from 0 to 60 miles an hour in less than four seconds, making it faster than a Porsche 911 or a Ferrari Spider.
The electric-car start-up was offered $465 million in low-cost loans by the U.S. Department of Energy to help build the new Model S. Tesla said it will build the new car in California.
Tesla's investors include Google co-founders Sergey Brin and Larry Page.
Other investors include Daimler; Abu Dhabi-based Aabar Investments, which owns a stake in Daimler; and venture capital funds Valor Equity Partners, Technology Partners, The Westly Group, and Compass Venture Partners.
Tesla said it had achieved overall corporate profitability in July with about $1 million of earnings on revenue of $20 million.
But like established automakers, survival in the hyper-competitive U.S. automotive market has not been easy for Tesla. The company had to face cost overruns and production delays for the Roadster.
Story Copyright (c) 2010 Reuters Limited. All rights reserved.
You GOTTA use this influx of cash to get the mass production machine greased, oiled and working full tilt. That's the only way you will be able to make these electrics affordable to all consumers, unless your plan is to only stay in the high end market. Please don't do that, I would like to purchase an affordable electric car in my lifetime, and I would like it to be North American made. Don't disappoint me guys!
The unions and dealerships will never allow it of course. The business model I describe is almost literally illegal / outlawed due to vicious dealership cartel laws.
$15-20k green car, with subsidy would do it.
This isn't rocket science folks.
And remember. Just because you are paranoid; it doesn't mean that they AREN'T out to get you...
You can't make up the rules of physics. If you are so smart why don't you design a battery that yields a million miles and costs a dollar?
Some of the best brains in the planet are workign on the problem you complain about. But just because they are not there yet doesn't mean they don't "get it". It means it is just not possible now. If the battery pack alone costs $20K, would you rather build a car that's utter cr*p and costs $25K, or build one that's awesome and costs $49K?
By the way, the Model S is not small, it seats seven, has a 250 miles range and performs like a Porsche, so I don't know where you are getting your data that this isn't going to change if it has changed already.
For $49K you could buy a top of the line minivan, yes. And it would have half the acceleration, one fourth of the efficiency, one tenth of the design and 0% of the environmental friendliness of this car. So your point is?
Best regards,
Martin from <a href="http://www.globalcleantech.com">Globalcleantech.com</a>
- by knowles2 November 23, 2009 3:45 PM PST
- I would not buy any shares in this company until the rumours coming out China, of cars which equal Tesla performance an will be made cheaper out there due to lower labour costs.
- Like this Reply to this comment
(13 Comments)If it true, then Tesla is going to be uncompetitive by manufacturing there cars in California, which I am sure not the cheapest place to higher people.
Overall I think this company serve better by staying in private hands an licensing it technology to the establishing players an building it own high end electric cars as a means to develop more patents to license.
Because so far it seemed to of been out maneuver by foreign companies an laden with debt. Certainly not a company I will be investing in any time soon.