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Customers will need to pay more for their reserved Tesla Roadster or lose the vehicle

The sexy and all-electric Tesla Roadster was the poster child for the green car movement when first announced. This was despite the fact that the electric sports car was far outside the realm of affordability for the masses.

The struggling Tesla Motors has put its foot in another pothole on the road to green car salvation by raising the price of many of the options on its vehicle. The problem is that an unknown number of Tesla reservation holders have received letters and phone calls telling them that the deposits of up to $50,000 placed for their new electric sports cars would no longer hold their rides for them.

The problem is that the buyers who had placed deposits were told that they would need to pay more for the vehicles that they had already ordered and optioned to their liking. The price of a Roadster with the standard feature set has been increased by $6,700.

The cost of the High Performance Charger that allows owners to recharge the batteries in the Roadster in as little as 3.5-hours was increased in price to $3,000 according to Autoblog. The previously stock set of alloy wheels is now a $2,300 upgrade.

Tesla is reported to claim that the price increases on the options are needed for the company to become profitable faster. This is despite the fact that these owners had previously been told that their order was accepted and that their cars were locked for production.

There is no word on price increases for the new Tesla Roadster Sport that was recently announced.

Updated 1/21/2009

Tesla contacted DailyTech to provide an official statement on the price increase we reported yesterday.

Tesla announced a $40 million financing round in November and is not running out of cash. Rather, it is increasing options prices for at least 350 customers who have not yet taken delivery of 2008 model-year vehicles in order to improve margins on each car delivered. Healthy margins make the company more attractive to the next round of investors -- whether they're venture capitalists, shareholders or the federal government in the form of low-interest loans -- and thereby help ensure the long-term viability of the company.

Tesla is fortunate and rare among automakers today in that it has sold out its production run through October. Waiting to increase options pricing would have resulted in many months of lower margins. Fortunately, many of Tesla's early customers understand this and have been very outspoken in their support for this difficult but necessary decision. No one at Tesla made this decision lightly, and we provided customers in-depth data so they could understand why Tesla did it. Ultimately it will help keep the company viable for decades to come so we can keep longstanding customers happy and greatly expand the number of vehicles we sell.

Tesla announced a $40 million financing round in November and is not running out of cash. Rather, it is increasing options prices for at least 350 customers who have not yet taken delivery of 2008 model-year vehicles in order to improve margins on each car delivered. Healthy margins make the company more attractive to the next round of investors -- whether they're venture capitalists, shareholders or the federal government in the form of low-interest loans -- and thereby help ensure the long-term viability of the company.

Tesla is fortunate and rare among automakers today in that it has sold out its production run through October. Waiting to increase options pricing would have resulted in many months of lower margins. Fortunately, many of Tesla's early customers understand this and have been very outspoken in their support for this difficult but necessary decision. No one at Tesla made this decision lightly, and we provided customers in-depth data so they could understand why Tesla did it. Ultimately it will help keep the company viable for decades to come so we can keep longstanding customers happy and greatly expand the number of vehicles we sell.



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Ah, the classic case of...
By theplaidfad on 1/20/2009 11:46:30 AM , Rating: 5
... the good ole' bait n' switch. Pay up boys, Pay up!




RE: Ah, the classic case of...
By Reclaimer77 on 1/20/2009 11:48:44 AM , Rating: 1
Lol yeah. I would love to feel sorry for these people, but I can't. They're idiots.

You could have had a Ferrari you suckers.


RE: Ah, the classic case of...
By hcahwk19 on 1/20/2009 11:51:37 AM , Rating: 1
True, but the Ferrari won't help you save the planet with its 8 mpg. :) Those who fell for this are a bunch of fools.


RE: Ah, the classic case of...
By mvpx02 on 1/20/2009 1:20:07 PM , Rating: 4
The planet is dying? The Tesla Roadster isn't "saving the planet" any faster than a Ferrari.


RE: Ah, the classic case of...
By quiksilvr on 1/20/2009 1:38:55 PM , Rating: 4
Though I agree the Tesla Roadster isn't "saving the planet", they have had PLENTY of opportunities to do so. They easily could have started with a 4 door sedan with a 300 mile range for $50,000. Instead they make some sport car that didn't sell well due to its insane price point, fired 90% of their workforce, and are now asking Congress for $350,000,000...idiots...


RE: Ah, the classic case of...
By othercents on 1/20/2009 2:33:38 PM , Rating: 4
quote:
They easily could have started with a 4 door sedan with a 300 mile range for $50,000.

Are you sure? My understanding is that building a 4 door sedan at that price range and still be profitable would require the ability to mass produce a large number of them. Since they neither had the facilities to mass produce the vehicle nor did they have the funding to build the facilities the next best option was the build a small number of higher end vehicles to build up capital.

Granted the economic turn of events has changed their position to need help to build the 4 door sedan which has included layoffs, increased pricing, and the need to beg the government for hand outs. However this still might have been the outcome even if they were producing a 4 door sedan. I haven't seen a car company not cut back in some way or another in the past year.

Other


RE: Ah, the classic case of...
By Solandri on 1/20/2009 3:42:57 PM , Rating: 1
Since they aren't selling anything yet, how could the economic downturn have negatively affected their ability to bring a product to market? If anything it has made it easier for them as higher unemployment has caused the cost of labor to drop, and suppliers for the Big 3 automakers are probably desperate to sell parts to them at discount prices.


RE: Ah, the classic case of...
By monomer on 1/20/2009 4:08:30 PM , Rating: 2
Solandri, Tesla delivered something like 100 Roadsters in 2008.


RE: Ah, the classic case of...
By Reclaimer77 on 1/20/09, Rating: -1
RE: Ah, the classic case of...
By Viditor on 1/20/2009 6:08:14 PM , Rating: 5
It's outrageously expensive to set up a large scale assembly line for a car (in the $billions). Tesla's plan (which was a very good one at the time) was to produce 100 of them and float an IPO for capital to build the line.
Unfortunately, the economy went south in the middle of that plan so that IPOs are not a good idea now...


RE: Ah, the classic case of...
By Solandri on 1/20/2009 8:16:22 PM , Rating: 1
I see. They weren't planning to grow the business with increasing sales, they were betting on an IPO to raise the funds needed to jump start at a higher level of unit sales. Risky, but might've worked in the era of loose credit. Thanks for the clarification.


By foolsgambit11 on 1/20/2009 7:57:34 PM , Rating: 2
And thus we return to the fact that Tesla couldn't manage mass production (at least, not for the foreseeable future). They went for the 'safest' business model for releasing a boutique electric car (or any boutique car, for that matter). Go sporty.


RE: Ah, the classic case of...
By William Gaatjes on 1/21/2009 4:06:22 PM , Rating: 2
Most sports cars are not mass produced, that's why they are so expensive. 100 is not a small number in those circles. If sports cars would be mass produced they are not exclusive anymore. And sometimes there is some revolutionary technology used as with porsche but even still. 100 is pretty average.


RE: Ah, the classic case of...
By Spuke on 1/21/2009 4:29:36 PM , Rating: 2
100 is not average. Even Lamborghini sells more cars than that. Ferrari sold more Enzo's than that. 100 is most definitely extremely low volume and definitely not average.


RE: Ah, the classic case of...
By CyborgTMT on 1/21/2009 8:32:41 PM , Rating: 3
Actually they are doing pretty good. Even though all Enzo's are listed as being produced in 2003, they were actually built between 2002 and 2005 giving Ferrari 3 years to build 400 of them. Tesla has produced 100 cars in a 9 month span. That is the exact same production rate as Ferrari - 133 cars per year.


RE: Ah, the classic case of...
By FITCamaro on 1/22/2009 7:02:16 AM , Rating: 2
They make more than the Enzo.


RE: Ah, the classic case of...
By Spuke on 1/22/2009 12:35:39 PM , Rating: 2
quote:
That is the exact same production rate as Ferrari - 133 cars per year.
Where do you get your numbers from? Ferrari made 122 cars in December alone. 1600 total for 2008.


RE: Ah, the classic case of...
By Drexial on 1/20/2009 3:00:39 PM , Rating: 2
Its your most notable cars that get attention. Chevy is recognized for its Corvette, not its cobalt. More people know Ferrari for the Enzo then the 355. So Tesla wanted to start at the top to get notoriety and to build capital to move on to a car for everyone.

It clearly isn't the cost of the car that has prevented them from selling car, considering they have 4 times as many people waiting for one as they have made. They started building them just before the costs of most of their materials went up. It also seems like they cant keep up with demand. (its starting to sound like Motorex)


RE: Ah, the classic case of...
By Reclaimer77 on 1/20/2009 3:24:31 PM , Rating: 2
Ferrari's, and to a lesser extent, Corvettes built their image and mistique on a racing background.

The Tesla is never going to have that kind of brand recognition going for it. It's always going to be the Elise with batteries.


RE: Ah, the classic case of...
By PrinceGaz on 1/21/2009 8:08:25 PM , Rating: 2
On Top Gear, the old Tesla Roadster (with the economy rather than performance tyres) managed a 1:27.2 round the track in "mildly-moist" conditions. Given that the Lotus Elise Sport 190 only managed a 1:28.2 under "dry" conditions, that makes the Roadster look very favourable.

Okay so the Roadster didn't have as good a handling around corners as the Elise due to the additional battery weight, but the sheer power and torque it could deliver whilst accelerating on straights, combined with the regenerative braking before corners which helped compensate for the extra weight and therefore kinetic-energy the discs would have to handle, made up for it.

It might only manage fifty or sixty miles around the test track when the Stig goes mad with it power-sliding around corners, such that the battery is dead in under an hour, but for the majority of people who want to commute to work in a high-performance non-locally-polluting car, it is a fantastic choice that can do between a hundred and two hundred miles on a full charge. Combined with an overnight charge from a nuclear power station, you can have a blast on the way to and from work, and still contribute a lot less to global-warming than Prius drivers.

An Elise with batteries? Yep, I'd take one, as it faster than the Elise on petrol (gasoline).


RE: Ah, the classic case of...
By Spuke on 1/22/2009 12:44:02 PM , Rating: 2
quote:
An Elise with batteries? Yep, I'd take one, as it faster than the Elise on petrol (gasoline).
Which is slower than a Chevy Cobalt SS.


RE: Ah, the classic case of...
By PrinceGaz on 1/22/2009 7:24:02 PM , Rating: 2
What do you mean by faster? Top Speed- which will only be of any use on a race-circuit, or Acceleration- which can be used every day.

Lets see:

Top Speed:

Tesla Roadster (any model): 125mph (electronically limited)
Chevrolet Cobalt SS (supercharged): 158mph (also electronically limited, but is the fastest model)

0-60mph Time:

Tesla Roadster: 3.9s (standard), 3.7s (2009 Sport)
Chevrolet Cobalt SS: 5.5s (the fastest version, the turbocharged model for this stat). I'm not going to include the supercharged version using the optional nitrous as that is not really fair.

Quarter-mile drag time:

Tesla Roadster: 12.8s (104.7mph final speed) (model used not stated, but was done in 2008)
Chevrolet Cobalt SS: 13.9s (102.5mph final speed) (turbocharged model, the fastest for the quarter mile)

So unless you normally drive at well over 70-80mph, I would say the Tesla Roadster is a good bit faster than all but the Chevy Cobalt SS being fed nitrous.

Even the 60-103mph times between them are close, with the Cobalt SS only having a slight advantage (these are estimated from the 0-60, and the quarter mile drag times which both passed the line at around 103-104mph)

Tesla Roadster: 8.8s (est)
Chevy Cobalt SS: 8.5s (est)

Based on those stats of the Tesla Roadster vs the best Chevy Cobalt SS (without nitrous), I'd say the Roadster is a good bit faster on all but a very fast track. The two cars would probably be very close after a half-mile drag-race with finishing speeds around the 120mph region, but you don't often have those on public roads.


RE: Ah, the classic case of...
By PrinceGaz on 1/22/2009 7:41:41 PM , Rating: 2
Oh, one other important point: the Roadster is rear-wheel drive whilst the Cobalt SS is front-wheel drive. Even if the Cobalt SS was using nitrous to massively boost its power; it would be pointless as you cannot transfer that sort of power to the road in a front-wheel drive car except at very high speeds. Using nitrous to boost its power to (guessing here) 400hp or so would just cause the front wheels to spin and burn rubber more than anything else.

Above about 100mph, the nitrous would certainly help increase performance, but on public-roads, it will only help you to outrun the police who are certain to be chasing you by then.


RE: Ah, the classic case of...
By Spuke on 1/23/2009 7:17:35 PM , Rating: 2
My mistake, I'm still thinking about the Car and Driver Lightning Lap.


RE: Ah, the classic case of...
By Nik00117 on 1/21/2009 3:16:42 AM , Rating: 2
This is bad, my company speacil orders vechilies all the time. A part of our program states that if the price of the vehicle goes up your not affected. If it goes down we give you the lower price.

Telsa needs to ahve the same ploicy. If they'd call me up and tell me that my next response was "When will I be getting my $50,000 back?"


RE: Ah, the classic case of...
By gstrickler on 1/21/2009 6:50:41 PM , Rating: 2
quote:
"When will I be getting my $50,000 back with interest ?"
Or maybe I would just pay the higher price (assuming I could afford to have pre-ordered one in the first place). I mean, it is a cool car, but it certainly makes me wonder how they are going to treat their customers when this is how they treat the early adopters who put up money well before a car was even available.


RE: Ah, the classic case of...
By hcahwk19 on 1/22/2009 7:27:30 PM , Rating: 2
I forgot that people will take you literally unless you denote sarcasm.


RE: Ah, the classic case of...
By bighairycamel on 1/20/2009 11:54:11 AM , Rating: 2
More like a Porsche. The cheaptest Ferrari (brand new anyway) is $173k base.


RE: Ah, the classic case of...
By Viditor on 1/20/09, Rating: 0
RE: Ah, the classic case of...
By kattanna on 1/20/09, Rating: -1
RE: Ah, the classic case of...
By noirsoft on 1/20/2009 12:44:34 PM , Rating: 2
The Tesla exists. They have already sold cars to customers.


RE: Ah, the classic case of...
By Drexial on 1/20/2009 2:09:25 PM , Rating: 2
I have seen one myself in Chicago on the streets. Its a nice looking car.


RE: Ah, the classic case of...
By jjmcubed on 1/20/2009 4:43:07 PM , Rating: 1
The fact that an untrue statement gets a 5 rating tells me more about the readers of this blog then any comment ever could. Interesting and disturbing.


RE: Ah, the classic case of...
By Spuke on 1/20/2009 1:30:12 PM , Rating: 4
Really?

Car and Driver
Tesla Roadster: 0-60 in 4.4 sec
http://tinyurl.com/9v7dtv

Porsche 911 Carrera: 0-60 in 4.1 sec
http://tinyurl.com/7wg6n4

Ferrari F430: 0-60 in 3.5 sec
http://tinyurl.com/9rnq3w


RE: Ah, the classic case of...
By quiksilvr on 1/20/2009 1:43:33 PM , Rating: 3
Um...NO. If you actually read the article it states:
"Zero to 60 mph transpires in 3.9 seconds, claims Tesla, and we believe it. (We recorded 4.4 seconds on a wet road with the old two-speed transmission in our unofficial first test.)"


RE: Ah, the classic case of...
By Spuke on 1/20/2009 1:53:43 PM , Rating: 5
quote:
"Zero to 60 mph transpires in 3.9 seconds, claims Tesla, and we believe it.
Um YEAH! That 3.9 sec 0-60 was NOT tested. Any car company can claim any number for performance. Hard, independent numbers are the only one's that count. I don't care what C&D believes, they TESTED the car and it got 4.4 seconds (not exactly slow BTW). And, more importantly, Viditors claim that the Tesla is so much faster than the Porsche and Ferrari is blatantly false. Hell, the 911 Carrera is cheaper and was the RWD drive version and it was STILL quicker in TESTING (not claiming or believing) than the Tesla.

Base prices
Porsche 911 Carrera: $75,600
Tesla Roadster: $109,000


RE: Ah, the classic case of...
By Reclaimer77 on 1/20/2009 2:19:59 PM , Rating: 1
Good post.

I don't agree with the premise behind arguing over 0-60 times though.

0-60 times obviously don't tell the whole story about the comparative value in a gimmick electric roadster and a traditional sports car.

Especially, as you so succinctly pointed out, the alarming cost of the Tesla. $100k + is pure exotic car territory, and frankly, the Tesla can't compete in this market.


RE: Ah, the classic case of...
By Spuke on 1/20/2009 2:30:44 PM , Rating: 2
quote:
0-60 times obviously don't tell the whole story about the comparative value in a gimmick electric roadster and a traditional sports car.
I agree here and don't pay much attention to them. If I'm interested in knowing a cars straightline performance, I use the 1/4 mile numbers instead. Also, I like my straightline speed but will compromise it for awesome grip and handling. That's why I really like C&D's new Lightning Lap tests, you get detailed explanations of how each car performs in each part of the lap. It gives you a really great idea of how certain cars perform in the handling and grip department.


RE: Ah, the classic case of...
By The0ne on 1/20/2009 6:40:12 PM , Rating: 2
I'm in the same boat as you are. C&D's new lap tests are really nice.


RE: Ah, the classic case of...
By Spuke on 1/20/2009 6:51:47 PM , Rating: 2
There are quite a few surprises in those tests. I always thought the Elise was a track God until the supercharged version was spanked by the FWD Cobalt SS by 3 seconds. Lightweight isn't everything.

http://tinyurl.com/47tktg


RE: Ah, the classic case of...
By The0ne on 1/20/2009 10:55:57 PM , Rating: 2
Yea, the new cobalt SS looks really good on the track :) Many are surprise by it.


RE: Ah, the classic case of...
By jjmcubed on 1/21/2009 1:57:26 AM , Rating: 2
According to this months letters, the driver of said Elise was shown the door. If that is really the case, a retest should be done.


RE: Ah, the classic case of...
By Spuke on 1/21/2009 12:28:48 PM , Rating: 2
quote:
If that is really the case, a retest should be done.
Interesting if that is the case. I would think a retest should be done. There's gotta be a lot of pissed of Elise owners out there. I can feel the hate within them.


RE: Ah, the classic case of...
By Moishe on 1/20/2009 4:23:10 PM , Rating: 4
John Carmack bought one and it has been delivered. He has dedicated a portion of the last Armadillo Aerospace update to include the car.

Great reading and provides non-PR insight into the car.

http://www.armadilloaerospace.com/n.x/Armadillo/Ho...


RE: Ah, the classic case of...
By Moishe on 1/20/2009 4:26:10 PM , Rating: 2
Another interesting thing is how Carmack compares his Tesla with his previous cars, a twin-turbo Testarossa and F50.


RE: Ah, the classic case of...
By Spuke on 1/20/2009 6:21:37 PM , Rating: 2
He doesn't really compare the two cars just mentions his previous cars as a background. And, WOW, what a background!!!! Obviously, the man loves retarded fast cars and he wasn't expecting that kind of performance from the Tesla. When a person feels that a F50 is MEH performance....LOL!!!!

Quote from him,
quote:
It doesn't have the wide-eyed, slack-jawed, religious-experience type of performance that my Testarossa used to have, but there is a lot to be said for racking up a dozen happy-car-grins a day with your normal driving.


I had the opportunity to ride in a car with a power to weight of .19. We're talking a car that's faster than a Porsche 911 GT2. Everytime the guy stepped on the gas, I would get a shot of adrenaline. It was exhilarating!!! Carmack's Testarossa would have a power to weight of .31. That's just insane!!! The Tesla would have a power to weight of .10. My Solstice has a PTW of .09.

Solstice GXP 0-60 is 5.6 sec (manual), 5.2 sec (auto)
Tesla 0-60 is 4.4 sec
Figures from Car and Driver

So a hundredth makes a huge difference.


RE: Ah, the classic case of...
By jmunjr on 1/21/2009 3:52:53 AM , Rating: 2
I got a Nissan GT-R in August. Now when I drive my 300hp Infiniti G35 w/manual transmission it feels really, really slow even though it hits 60 in 5.5 seconds, and so would 99.99% of all other cars on the road...

I bet if I drove a Veyron the GT-R would seem slow, and in all honesty I wish the GT-R was faster...it can be but still debating the upgrade.


RE: Ah, the classic case of...
By Spuke on 1/21/2009 1:43:21 PM , Rating: 2
quote:
I got a Nissan GT-R in August.
Congrats on the GTR. I'd a imagine a Veyron would make nearly anything feel slow. :)


RE: Ah, the classic case of...
By gstrickler on 1/21/2009 7:04:11 PM , Rating: 2
quote:
So a hundredth makes a huge difference.
Torque is at least as important as power in 0-60 results. Electric motors are noted for being very high torque, and that's the main reason for the differences in timing between the Solstice and the Tesla. Power helps more at the high end, where overcoming drag is the main factor. That's not to say that power isn't important, but for "quickness", torque and weight are more important than power.


RE: Ah, the classic case of...
By Spuke on 1/22/2009 3:36:00 PM , Rating: 2
The Tesla has a 300 lb weight advantage on my car also so I'm really not surprised that it's faster. It probably has more area under the curve than my car too but that's just a guess. Also, hp is just the result of a mathematical formula. You make torque and hp through the entire rpm range.

HP = rpm x T(torque)/5252(constant)


RE: Ah, the classic case of...
By 67STANG on 1/21/2009 9:00:29 PM , Rating: 2
Or for $65k:

Ariel Atom
0-60 in 2.9 seconds, FTW

http://www.youtube.com/watch?v=WaWoo82zNUA


RE: Ah, the classic case of...
By Spuke on 1/22/2009 3:37:29 PM , Rating: 2
quote:
Ariel Atom 0-60 in 2.9 seconds, FTW
When I hit the lottery, that's the first phone call I'm making.


RE: Ah, the classic case of...
By ekv on 1/25/2009 3:07:29 AM , Rating: 2
After that video they ought to change the name to Alien Atom. "You too can be an alien ..." 8)

Always wanted a Porsche, but I think for sheer fun this would be hard to top. Wow.


RE: Ah, the classic case of...
By strikeback03 on 1/20/2009 2:58:49 PM , Rating: 1
Because lots of owners buy Ferraris and Porsches to drag with :roll:

In the primary use for most (looking good) then the Tesla is probably competitive. If you want an actual performance comparison, lets see how the Tesla does for a day at a road course.


RE: Ah, the classic case of...
By Spuke on 1/20/2009 3:34:19 PM , Rating: 3
quote:
Because lots of owners buy Ferraris and Porsches to drag with
Both owners are interested in total performance and do indeed hit up the drag strips with these cars. Both marques make vehicles that are stunningly fast in a straight line so why wouldn't an owner be interested in using that performance?


RE: Ah, the classic case of...
By The0ne on 1/20/2009 6:42:02 PM , Rating: 3
Top Gear got two of them and they both died during tests I believe. There's a youtube video somewhere. :)


RE: Ah, the classic case of...
By Viditor on 1/21/2009 12:32:01 AM , Rating: 2
The batteries went flat after 50km...
It seems when you drive at high speeds (like racing), the battery empties MUCH faster (50km range instead of 250 mile range).
Top gear didn't have enough time for a recharge to make air.


RE: Ah, the classic case of...
By Tsuwamono on 1/20/2009 1:02:15 PM , Rating: 1
they will probably pay the original price listed and anyone purchasing AFTER the price change will pay the new one...


By consumerwhore on 1/20/2009 2:10:53 PM , Rating: 2
It's only "bait and switch" if it was planned all along for the past two years...


RE: Ah, the classic case of...
By nugundam93 on 1/20/2009 7:03:34 PM , Rating: 2
quote:
Tesla is reported to claim that the price increases on the options are needed for the company to become profitable faster.


wow. way to go. NOT!

they could've just let their satisfied customers help sell more through word-of-mouth advertising but no, they had to have dissatisfied customers even before they get the car. amazing.


"The Space Elevator will be built about 50 years after everyone stops laughing" -- Sir Arthur C. Clarke

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