pinterest-p mail bubble share2 google-plus facebook twitter rss reddit linkedin2 stumbleupon
The Premium The Premium The Premium

Rise of Tesla: Sells More Than Luxury Brands

Cars
Rise of Tesla: Sells More Than Luxury Brands

History is filled with stories of tremendous underdogs who bucked the odds to beat the giants. David slew Goliath, the Dallas Mavericks beat the heavily favored Miami Heat in 2011, the Los Angeles Dodgers rode Orel Hershiser and Kirk Gibson to upset the Bash Brothers of the Oakland Athletics in 1988, the ice hockey team of the United States had their Miracle on Ice in 1980.

In the automotive industry, a new kid on the block is showing up the more established competitors. Porsche and Jaguar may be standards in the luxury market, while Chrysler may be considered as one of the Big Three; recently however, none of them could hold a candle to a company that is barely 10 years old.

Tesla Motors – The New Kid on the Block

TeslaMotors_HQ_PaloAlto

In 2003, Martin Eberhard and Marc Tarpenning incorporated Tesla Motors. Elon Musk later joined the company’s Board of Directors as the Chairman after leading the Series A round of investment in 2004.

The long-term strategic goal of Tesla Motors was the creation of cheap and affordable mass market electric vehicles. This would ensure a substantial and material impact on the level of consumption of oil. By 2006, or barely three years after incorporation, the company was already receiving recognition for the design of the Tesla Roadster, winning the Global Green Award in 2006 and the Index Design Award in 2007.

By the third round of investments, other prominent personalities and entrepreneurs have joined in. These include the likes of Larry Page and Sergey Brin of Google, Jeff Skoll of eBay, and Nick Pritzker of Hyatt.

In 2009, Tesla had made enough noise in the market to warrant the notice of Daimler AG of Germany, the maker of Mercedes Benz, which bought an equity stake in the company of equivalent to less than 10 percent, of which 40 percent was later sold and passed on to Aabar Investments of Abu Dhabi.

In the middle of the year, the company received $465 million in loans from the Department of Energy as part of a program for advanced vehicle technologies. It only took Tesla four years to fully repay the loan, making them the first company to pay back the government.

By August 2009, Tesla had already achieved overall corporate profitability. It then listed in the stock market the following year, with its initial public offering raising $226 million for the company. It was the first carmaker from the United States to go public since Ford did it in 1956.

Despite being a newcomer, Tesla has been tapped by the likes of Mercedes Benz and Toyota to collaborate on their vehicles, namely the Mercedes Benz A-Class and the Toyota RAV EV respectively.

Tesla Car Models

Roadster_Goodwood

Tesla Roadster

The first production vehicle from the company was the Tesla Roadster, an all-electric sports car. The Roadster has the distinction of being the first highway-capable, all-electric vehicle in serial production that was sold in the United States. It is also the first production automobile to use lithium ion battery cells. It is also the first all-electric vehicle to travel more than 320 kilometers per single charge. More than 2,400 units were sold in 31 countries until 2012.

The Roadster is also credited with being the first car to break the legitimacy barrier of electric vehicles. It can accelerate from zero to 60 miles per hour in just 3.7 seconds and had a quarter mile speed of 12.6 seconds at 102.6 miles per hour.

Production of the vehicle ended in 2012 after the supply of Lotus Elise gliders ran out.

Tesla Model S

The Tesla Model S is a sedan that was originally called the Whitestar. Deliveries began in the middle of 2012. The car has been receiving accolades since its release, including the 2013 Motor Trend Car of the Year, the 2013 World Green Car, and the 2013 Automobile Magazine Car of the Year. It was also in Time magazine’s list of the 25 best inventions for 2012. It also received the highest safety rating of any car ever tested by the National Highway Traffic Safety Administration, or NHTSA.

Tesla Model X

The Tesla Model X will begin production in 2014. Reservations for the car are already being taken for delivery next year.

The Selling Point

01-2012-tesla-model-s-fd-1347336745

How far has Tesla Motors gone? The Tesla Model S is currently outselling other luxury brands in California. The luxury vehicle segment may just be a small portion of the market, but still, the achievement and the numbers are pretty impressive.

From January to August of 2013, there were 4,714 Tesla S cars sold in California. This is more than the numbers for Porsche, Land Rover, Volvo, Lexus, Lincoln, Audi and Jaguar. These established luxury brands only sold 4,586, 4,022, 2,982, 2,298, 2,230, 1,619 and 1,254 units respectively. Considering that Tesla only sold 14 units for the same period the previous year, this year’s number represents an astounding jump of 33,571 percent.

Tesla has likewise outsold companies like Buick, Fiat and Mitsubishi in California so far this year. These companies have sold 4,675, 3,898 and 2,939 units, respectively.

The Tesla S is selling for up to more than $70,000, making its achievement even more impressive. If that is not enough, the feat was attained despite the fact that only an electric plug can only fuel the car. Unlike the Chevrolet Volt, the Tesla S has no backup gasoline engine whatsoever.

Increasing Value of the Company

Elon-Musk-Tesla-Model-X

On the back of its impressive performance, Tesla’s shares are now up by almost 400 percent for the year, with a value of more than 260 times its estimated earnings for the year. In comparison, Ford’s and General Motor’s shares are being traded at only 10 and 11 times their earnings.

The actual value of Tesla is now at $20 billion. It has now exceeded the value of Chrsyler, and even the entire Fiat Group that owns Chrsyler, which has a value of only around $7.14 billion.

The $20 billion is still just a third of Ford’s value, but the latter is definitely keeping an eye on its rear view mirror for the ever-increasing figure of Tesla Motors.

  • Ad Free Browsing
  • Over 10,000 Videos!
  • All in 1 Access
  • Join For Free!
GO PREMIUM WITH THERICHEST
Go Premium!

Videos