The Car Tech blog

A road map for electrifying our streets, and a plan to charge by the mile to drive them. We'll check out an Audi that drives itself and look at the A5 Cabriolet--as it lost its top, did it lose its beauty as well? Plus: Is a Tesla IPO on the way?

Listen now: Download today's podcast

• Autonomous Audi TTS drives itself

• Dutch drivers to pay by the mile (well, kilometer)

• A grand plan to electrify the nation's driving

• Tesla Motors IPO rumored to be near

• CNET Review: Audi A5 2.0T Cabriolet

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) 2009 Reuters Limited. All rights reserved.

GM says yes to the Cadillac of Volts, eBay offers some free online car buying protection, electric cars you fill up--not charge up--and a ride in a car that has the Sport on it, but not really in it.

Listen now: Download today's podcast

• GM will build the Cadillac Converj

• TomTom iPhone app gets better--but not cheaper

• Europe envisions cars forming highway trains

• eBay offers free vehicle history reports with listings

• Electric cars you don't charge but fill up

For 2010, Tesla updates its electric Roadster with a Sport version, featuring faster acceleration.

(Credit: Josh Miller/CNET)

2010 Tesla Roadster Sport photos

Tesla often emphasizes that it works more like a Silicon Valley technology company than a traditional car company. And the company just proved it by delivering a model update to the Tesla Roadster for 2010. Remember, the Roadster has only been in production for one year, but in that time Tesla completely redesigned the interior, while at the same time adding new materials to reduce cabin noise. Model updates from other automakers often take five years.

We spent a day with the 2010 Tesla Roadster Sport, enjoying its unique driving experience and finding these updates made the previous generation car seem like something hacked together in a garage. Where the previous car had a fussy little lever for putting it in drive, the new car uses push buttons. To check battery statistics and change the drive mode, you had to use a touch screen by your left knee. That touch screen has been moved to the center of the dashboard. And in a real step toward convenience, the Tesla Roadster now comes with a glove box.

The rear air intakes get clear coat carbon fiber inserts.

(Credit: Josh Miller/CNET)

Externally, the casual observer won't see much difference. The Tesla Roadster uses the same Lotus-sourced body clad in carbon fiber. But the carbon fiber stands out more, as clear-coat panels make up the hood, spoiler, and even the insets in the rear air intakes. The suspension is now adjustable for comfort or sport, and the all-new Sport version of the Roadster uses an upgraded power train that rockets it to 60 mph in 3.7 seconds, faster than the standard Roadster's 3.9 second time.

Simon Hacket and Emilis Prelgauskas at their 313-mile mark in Coober Pedy, South Australia.

(Credit: Hackett)

A record for a Tesla Roadster driven on a single charge was set at 313 miles (501 km) in Australia on Tuesday.

Tesla Roadster owner Simon Hackett and his friend Emilis Prelgauskas drove his electric sports car from Alice Springs, Northern Territory, to Coober Pedy, South Australia, as part of an alternative-fuel vehicle rally called the Global Green Challenge.

The Tesla's electric-charge port door was sealed shut at the start of the 313-mile journey and the trip was filmed for a documentary, as well as monitored by contest officials. The Tesla's lithium ion battery, which the company assures owners will last over 200 miles between charges under normal driving circumstances, had 3 miles to spare when the team reached its destination in Coober Pedy, according to Hackett's chronicles of the race experience on his company blog. (Hackett happens to also be the founder and managing director of Internode, an Australian national broadband and Internet services company.)

Hackett said in his blog the achievement is actually a record for any production electric car, not just a Tesla Roadster, which is why his team was so careful to record it. To squeeze as much distance out of the Tesla's battery as they could, Hackett and Prelgauskas tried to drive at a consistent speed of 55 kph (roughly 34 mph) for a large portion of the almost 12-hour journey.

"The security seal was applied to the charge port door when we started the journey. As this is being done as part of the Global Green Challenge, we have a full set of official verifiers here who will attest to the results and to achieving the outcome. We were followed along the journey by our support crew and a documentary film crew--so we have it on film," said Hackett.

While Tesla Motors is not an official sponsor of the contest or Hackett, the company has shown support by spreading the news of Hackett's success. It's not hard to imagine why as Tesla poises for a major retail expansion.

The stunt may certainly speak to consumers who likely drive nowhere near 313 miles in a single day, but are still reluctant to hem themselves in with a car restricted to a limited number of miles between recharges.

(Credit: Automotive News)

Tesla Motors will expand sales into four more U.S. and Canadian cities this year, but interested dealers need not apply.

The maker of electric sports cars is skipping the traditional U.S. franchise system to maintain total ownership of its retail chain as the company grows, says Tesla spokeswoman Rachel Konrad. "Our model is more like the Apple Store" found in shopping malls, she says.

The California venture now faces the challenge of handling service problems.

The company has only four U.S. retail outlets: in Los Angeles; Menlo Park, Calif.; New York; and Seattle. Tesla has sold about 700 of its cars spread across all 50 states. This year the company plans to open stores in Chicago, Washington, Toronto, and Dania Beach, Fla., outside Miami.

The stores will not rely on service business to make a profit, because electric cars have fewer serviceable parts. The cars have no need for oil changes or fuel filter replacements, for example.

Instead, Tesla is developing a mobile field service organization that will travel to owners as necessary. A fleet of service vans will handle customer problems outside the cities in which Tesla has a store, Konrad says.

The concept got an unexpected test this summer when a part was recalled by Tesla's chassis supplier, Group Lotus. Tesla dispatched service technicians by car, truck, and airplane to each of its 700 customers, Konrad says.

For now, Tesla's retail plans probably are irrelevant to most U.S. auto dealers. Its sole product so far is a $100,000-plus electric two-seater. But within two years, the company plans to market an electric family sedan that costs less than $50,000. After that it plans to bring out an electric car for less than $30,000.

Konrad says Tesla's retail sales and service personnel will be paid a straight salary in hopes of keeping distribution costs lower than those at a traditional auto dealership.

The company thinks that factory ownership will reduce distribution costs. "We will be the retailer," she says. "It won't be a third party trying to make a profit on sales or service."

(Source: Automotive News)

Right now, Tesla's single model and its six-figure sticker appeal only to high-end early adapters of EV technology.

(Credit: Tesla Motors/Automotive News)

(Credit: Automotive News)

It's a small-volume producer of $100,000 electric sports cars today. But Tesla Motors Inc. plans to move into mainstream U.S. auto sales over the next six years.

Tesla intends to use $465 million in low-interest loans from the U.S. Department of Energy to support a two-step move from exotic sports cars to lower-priced family vehicles.

In 2011, the California company will begin producing its Model S electric family sedans priced at around $49,900. Five years later, it plans to introduce a more mass-market electric vehicle for less than $30,000, the company says.

The proposed Model S will have room for four adults and rear-facing seating for two children in its cargo area. Tesla thinks it can sell about 20,000 a year.

Tesla's 1-2-3 plan
2008: Launch sale of $109,000 two-seater
2011: Introduce a $49,900 family vehicle
2016: Introduce a vehicle below $30,000

$109,000 to below $30,000

Plans for a vehicle below $30,000 mark a dramatic departure for a Silicon Valley startup that few in the industry have taken seriously. Until now, Tesla wasn't much of a threat.

Its sole product is a two-seat sports car, the Tesla Roadster, that sells for $109,000. The Roadster went on sale in the United States last fall, and so far, Tesla has sold just 700.

But things are changing rapidly.

This summer, the Department of Energy committed to lending Tesla $465 million. The company intends to spend $100 million of that to build a power-train plant in the San Francisco Bay Area. The remaining $365 million will help open an assembly plant in Southern California to produce the higher-volume Model S, Tesla spokeswoman Rachel Konrad says.

The new factories will begin to enable Tesla to reduce its high production costs.

The battery pack that runs the current two-seater weighs about 1,000 pounds. To compensate, Tesla uses lightweight carbon-fiber body panels. Because the car is so low-volume, Tesla does not produce its own panels but pays a premium to import them from Sotira, a French company.

The new assembly plant will allow Tesla to use aluminum body panels, Konrad says.

Tesla also will try to reduce the manufacturing cost of its lithium ion battery packs. The packs currently represent about $30,000 of the car's $109,000 retail price. Konrad says the cost of the batteries has been declining 8 to 10 percent a year.

240 miles on a charge

The Tesla sports car runs 240 miles on a charge. In contrast, the electric vehicles being developed by Nissan Motor Co. and Mitsubishi Motors Corp. promise about 100 miles on a full charge. General Motors Co.'s plug-in Chevrolet Volt will go 40 miles on a charge, and then the motor will kick in to recharge the battery pack.

Konrad says the 2011 Model S will come with three interchangeable battery options. One will provide a 160-mile range on a charge; one, a 230-mile range; and a third, a 300-mile range.

Tesla plans to let owners swap out batteries as needed. Konrad says a family that bought the car with a low-range battery could rent the long-range battery when extended driving range might be needed.

(Source: Automotive News)

Obama extends the Guzzler's program--how long will it last? Nissan prepares to get its first EV to market ahead of schedule. California makes new rules about car insurance company snooping. And we take a ride in the stunning BMW Z4.

BMW's new Z4 is a stunner and doesn't go techless to do it.

(Credit: CNET)

• CNET's BMW Z4 review

• CNET's Kia Soul Exclaim review

• Nissan Leaf electric car coming to market soon

• Take a look at a Smart car with three seats

• Replace your GM head unit but keep the DIC

(Credit: Tesla)

Upstart Tesla Motors proved the time is ripe for a new car company, reporting a profit of approximately $1 million on revenue of $20 million for the month of July. Tesla reduced its cost to build its electric sports car, while introducing the more expensive Roadster Sport model to its model line-up. The company shipped 109 cars in July, its highest output to date, reflecting an improved assembly process at its Menlo Park, Calif., facility. Tesla reports expanding sales to European customers for the third quarter, along with expansion into other countries, including Russia.

Earlier this year, Tesla won a $465 million government loan to develop the Tesla S, a sedan the company will use to expand its model line-up. Through a partnership with Daimler, Tesla power trains will be used in a fleet of 1,000 electric Smart cars, hitting the road later this year.