Tesla smarting from credit crunch

Tesla Motors, the makers of the electric sports car fetishized by enviros worldwide, is announcing a "modest reduction in near term headcount" in response to the global financial crisis.

By , Blogger for The Christian Science Monitor

  • close
    Visitors inspect a Tesla Roadster during the second press day of the Paris Auto Show, Friday, Oct. 3, 2008.
    View Caption

Tesla Motors, the makers of the electric sports car fetishized by enviros worldwide, is announcing a "modest reduction in near term headcount" in response to the global financial crisis. Additionally, the company is replacing CEO Ze’ev Drori with co-founder Elon Musk, and will move its Detroit operations to its future San Jose headquarters. Drori, who was hired as CEO last December, will continue on the company's board of directors.

"These are extraordinary times," wrote Musk in Tesla's official blog. "The global financial system has gone through the worst crisis since the Great Depression, and the effects are only beginning to wind their way through every facet of the economy. It’s not an understatement to say that nearly every business will be impacted by what has unfolded in the past weeks, and this is true for Silicon Valley as well."

Musk did not say how many workers would lose their jobs. The company employs more than 200 people.

Recommended: Could you pass a US citizenship test?

Tesla says that it will focus on production of its Roadster, the $100,000 all-electric sports car that can hold its own against a Porsche. The company has produced only a few hundred cars each year since beginning production in 2006: according to Motor Trend, the company hopes to produce up to 40 cars a week next year.

Tesla says that it will also continue to sell its powertrain to other automakers, in an effort to become cash-flow positive in the next six to nine months.

All this means a delay for Tesla's Model S, a high-performance electric sedan said to be priced at about $60,000. The plan was for profits from the Model S to fund a third electric car that normal people can afford. Now the Model S won't begin production until mid-2011, according to Musk.

Share this story:

We want to hear, did we miss an angle we should have covered? Should we come back to this topic? Or just give us a rating for this story. We want to hear from you.

Loading...

Loading...

Loading...