Friday, June 26, 2009

Can Tesla survive?

Tesla motors, the US based makers of electric cars, recently received $465 million as part of the Department of Energy's $25 billion advanced technology loan fund. This fund seeks to create green jobs and reduce the US dependency on foreign fuel.

However, I am not quite sure whether Tesla can survive the current crisis that has hit the US automakers quite hard. One reason is that they only have two models in the stable, viz., the Model S and the Roadster. Unlike the Toyota Prius or the Honda Hybrid cars, Tesla's models are pure electric cars.

They are also targeted at a niche market - people who like sporty cars. So they are going up against some big names like Porsche, Ferrari, Lotus, etc.

Having said that, maybe being small and nimble may actually serve the company well. Plus, a number of people who can afford the fast, flashy cars are turning their backs on the gas guzzlers as being seen as "Green" becomes fashionable. They have already "delivered slightly more than 500 Roadsters". The Model S sedan is also due to come out in 2011.

Model S

This interesting BusinessWeek article asks "Can Tesla Become a Real Automaker?"

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