LOS ANGELES (Reuters) - Electric car start-up Tesla Motors Inc on Wednesday said it should be profitable by the middle of this year and that it sold out of its Roadster sports car model until early November.
Founder and Chief Executive Elon Musk, in a company newsletter, also said the company expects to receive funds from a $350 million Department of Energy loan within four to five months that will go toward a new four-door electric sedan set to go into production in 2011.
“The Obama administration has thankfully made it a top priority to move quickly on the Advanced Technology Vehicles Manufacturing loan program,” Musk said in the letter.
Tesla will soon be sold out of all of its planned 2009 production of the $109,000 Roadster, a battery-powered performance car, despite “some cancellations due to buyers experiencing personal financial difficulties.”
The Roadster is one of the first entrants in a segment of the auto market expected to grow quickly as consumers shift from traditional gas-powered engines to reduce carbon emissions and save money.
The road hasn’t always been smooth for Tesla, however. The company ran into a series of cost overruns and production delays with the Roadster before slashing 24 percent of its staff and launching a $40 million convertible debt financing round late last year.
To date, the company said it has produced 200 Roadsters and said there are more than 1,000 customers still awaiting delivery of their cars.
Tesla also said it has determined that its battery packs should last about seven years, or more than 100,000 miles. Customers may pay $12,000 up front and receive a new battery pack after seven years, Musk said, adding that the current replacement price of the pack is nearly three times that.
Musk, who became a billionaire by founding PayPal, said the privately held car maker expects to unveil a prototype of its new sedan, called the Model S, on March 26.
He added that as a “gesture of gratitude for their early support” Roadster owners will get a $10,000 discount off the price of the Model S and automatically be first in line to buy one of the sedans.
Last month Tesla announced that it was working with Germany’s Daimler AG on an electric version of the Smart minicar. At the time, Musk said Tesla was also looking for electric car partnerships with one or two other major automakers.
Musk also said Tesla has reached an agreement to open stores in Chicago and London and is close to finalizing locations in Miami, New York, Seattle and Munich.
(Additional reporting by Nick Carey in Detroit)
Reporting by Nichola Groom, Editing by Gunna Dickson, Bernard Orr