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A recent entrant to the auto industry has been electric-car manufacturer, Tesla Motors. Tesla became the first auto company to offer an IPO since Ford in 1956. Amid a volatile wall street, the company did better than expected when they sold 13.3 million shares at $17 dollars per share (Welsh).

The company has been selling small electric sports cars for several years and has showcased the potential of electric cars in performance and speed (Welsh). The Tesla Roadster, as it is named, sells for $100,000 and only comes with two seats. However, the company is working on a new model in coordination with Toyota, known as the Model S, which will be significantly less expensive and will come as a sedan for practicality. Developing new and technologically advanced new designs requires huge sums of money, including 465 million dollars in federal loans and the company is not expected to make a profit until they begin to sell the new Model S (Tesla).

While I would love to see new auto makers succeed in the market, developing such an advanced vehicle is a daunting task, even for established companies with huge engineering departments. While working with Toyota is a good sign, Tesla and its main competitor, Fisker, have consistently pushed further back production dates and other timeline landmarks. I suspect those who are investing in Tesla are doing so in the hopes of capturing an untapped market of those willing to pay a lot for electric cars, but I believe too many are assuming that companies like Tesla or Fisker will ever get their cars in owners’ driveways.
I also suspect companies like Toyota are partnering with Tesla in hopes of sharing technology that Tesla has learned in batteries and electric motors. My main doubts for the Model S stem from the fact that the car is a completely new design. Tesla only had to worry about the battery and electric motor for the roadster as most other components came from Lotus (Ricketts). Now Tesla has to think about everything from the steering wheel design to the chassis.

Works Cited
Ricketts, Camille. "Tesla Extends Roadster’s Lifespan with New Lotus Deal." GreenBeat. VentureBeat, 29 Mar. 2010. Web. 22 Sept. 2010. .
"Tesla Motors." The New Yrok Times. 29 June 2010. Web. 22 Sept. 2010. .
Welsh, Jonathan. "TSLA: What Does Tesla’s IPO Mean for the Future of Electric Cars?" The Wall Street Journal. 29 June 2010. Web. 22 Sept. 2010. .