We at CarGurus Central are big fans of Tesla Motors.
The company, led by determined businessman Elon Musk, is one of contradictions. It is scrappy yet innovative. It’s an underdog yet a major player in a new automotive era. By all rational reasoning, the company shouldn’t exist. A startup business chasing a theoretical auto market shouldn’t have a chance at success when competing against the big, established players in the automotive business.
An electric-only carmaker could easily be laughed straight off the assembly line.
But this is Elon Musk. This is Tesla. This is the company that took all kinds of criticism and then delivered the Tesla Roadster to around 2,500 people for over $100,000 each. This is the company that said it could mass-produce an electric sedan, make it beautiful, and give it a range of up to 320 miles while keeping the starting price at around $50,000. Many people rolled their eyes.
But Mr. Musk didn’t care about the people who didn’t think his company could do it. He focused instead on the people who did believe, going to Daimler, Panasonic and Toyota (not to mention the U.S. Government) and securing hundreds of millions of dollars in loans and investments. Tesla proceeded to develop the Model S sedan, put it in pre-production, and now, all 6,500 copies that will be built next year are already sold. Can any other car company claim a complete sell-out before production even starts? Well, Ferrari and Lamborghini maybe. The bigger question is: Can Tesla keep up the success?
The odds are looking pretty good. Musk says of the pre-orders, “They’re mostly new buyers. Only about 600 people who have ordered Roadsters have also bought the Model S.” That means so far, the Model S has already brought in around 5,900 new customers. And the car doesn’t even officially exist yet.
But Musk still wasn’t done dropping the good news.
The tech startup mogul also said that Tesla could see an annual profit by 2013, much faster than many analysts expected.
That’s good news for investors and, if it happens, should finally silence the critics.
Do you believe Tesla will become profitable in the next two years and continue developing new electric vehicles, or will Elon Musk follow in the footsteps of Preston Tucker?