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EV Maker Tesla Edges Closer to IPO

Founder Elon Musk also confirms plans for a Roadster replacement.

by on Apr.29, 2010

Tesla Motors founder Elon Musk, shown here with the Tesla Roadster, at the Detroit Auto Show, January 2009

The California-based electric vehicle manufacturer, Tesla Motors, is edging closer to an initial public offering, according to founder Elon Musk.

Musk also confirmed that Tesla is working on a replacement for its current 2-seat sports car, the Roadster, which will go out of production by 2012.  That timetable has been dictated by the British maker, Lotus, which supplies the chassis used by Tesla for its first production model.

“We hope to go public in a couple of months,” Musk said during a visit to Detroit, another company official noting that Tesla’s planned IPO has already gone through two rounds of reviews by the Securities and Exchange Commission since the company announced its interest in selling stock, back in February.

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Tesla has already formed an alliance with Daimler AG, which has purchased an 8% stake in the California start-up, and which will be using Tesla’s technology to power the new electric-powered Smart cars that will reach the market in the U.S. late this year or early 2011. Tesla has other projects underway with Daimler and is also discussing possible alliances with two other automakers, Musk said.

The maker has expansive plans for growth, in the coming years, though Musk acknowledged there will be a gap between when production of the current Roadster ends, and production of a 7-seat sedan, the Model S, begins.  The problem is that Lotus is cutting production of its own roadster, the Elise, which shares its basic platform with the Tesla 2-seater.

To minimize the size of the gap, Tesla plans to stockpile roadsters before the launch of the Model S-Sedan, which is scheduled to reach market in 2012, Musk said.

Tesla has already started asking suppliers for quotations, indicating development of the sedan is well along.  But so is planning for an even smaller and less expensive battery-electric vehicle, or BEV, that would sell for around $30,000, Musk said.

The 38-year-old Musk, who made two fortunes as an Internet entrepreneur before plunging into the car business, was in Detroit to pick up an award as the Auto Industry’s Executive of The Year.

“Elon Musk is a man who came from humble beginnings to accomplish the extraordinary,” said Robert Djurovic, executive director of the Automotive Executive of the Year Award program, and director of automotive services North America, DNV Business Assurance US.

“We are thrilled to present him with our Innovator Award, and see him as someone who has not only already accomplished so much in his young life, but also, as one to watch for future technology breakthroughs,” Djurovic said.

Musk said he founded Tesla to demonstrate that electric vehicles can work.

“I wanted the Tesla to serve as a good example and be a pioneer to show people you can create compelling electric vehicles,” said Musk, who entered the automotive business after PayPal to eBay for $1.5 billion.

So far his campaign is showing signs of paying off – though skeptics caution that there’s no guarantee Tesla will ever turn a profit. But other big manufacturers such as Ford Motor Co. and General Motors Corp. are now developing electric vehicles, despite their own prior skepticism.

“Bob Lutz has been very gracious about giving Tesla credit for inspiring the Chevrolet Volt,” Musk noted.

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