Tesla raising millions more amid restructuring
A million dollars here, a million dollars there; after a while, it starts adding up.
Can these guys ever stay out of the news?
Tesla Motors is wrapping up a $40 million round of funding and will then seek another one on top of that in a few months, according to an interview with CEO Ze'ev Drori in VentureWire (subscription required).
Tesla has already raised more than $100 million. The money was largely used to develop the Tesla Roadster, an all-electric sports car coming out later this year, and build out the company's facilities. Car factories cost a lot. The onerous capital requirements, along with the long development time, are two of the reasons you don't see a lot of car start-ups make it to maturity. Still, when companies get past the $100 million mark in funding without releasing a product, eyebrows start to go up in Silicon Valley. Something about that number tends to bring out skeptics.
Despite the long odds for a car company, many are trying. There are well over 20 electric and hybrid car start-ups, ranging from economy car specialists like Miles Automotive to high-end hybrids like the ones from Fisker Automotive. Then there are the three-wheelers from Venture Vehicles.
Tesla has had a rocky time lately. In 2007, it delayed the release of the Roadster from last year to this year, fessed up to problems with the car's transmission, and swapped CEOs.
The delay of the Roadster could, possibly, lead to delays with the company's plans to come out with an all-electric sedan. Tesla has been hoping to come out with that in late 2009 or early 2010. Getting the price of an electric sedan to the $50,000 or less mark is tough because of the price of batteries. Interestingly, company execs have even complimented the Chevy Volt, which uses gas and electric power. A Volt type of car can be built for less and have a longer range, hypothetically, than a pure electric.
Recently, it also said it had cut around 26 employees, or 10 percent of its staff. Tesla denied layoffs were occurring back in December. These terminations, it says, relate to employee performance.