Tesla: Ready For Primetime?

A car powered solely by electricity. Decades ago, this was an unreachable ideal. Now Tesla, the electric car company, has introduced not one, but three innovative models, all capable of operating on nothing but electricity. The first car Tesla released on the market accelerated from 0 to 60 miles per hour in 3.7 seconds. That's as fast as some Lamborghinis. But that was just the brand's first car; Tesla then moved on to making more affordable cars. Two years after introducing its fastest car on the market, a less-expensive battery was developed that's as powerful as an eight-cylinder engine. By developing a more commercially friendly vehicle, Tesla attracted $50 million in investments from Daimler AG Corporation, the company that owns Mercedes-Benz, Freightliner and the Smart Car.

The next step was to get this more affordable vehicle to achieve successful market penetration. To do this they would have to gain the favor of consumers on the strength of a prototype. By hiring test subjects to drive the more affordable vehicle, they developed a fan base that was critical to attracting more investment capital. Shortly thereafter, the federal government loaned Tesla $465 million. Once Tesla secured that investment, the company began drawing legitimate interest from Toyota, one of the world's most reliable and profitable auto manufacturers. Toyota was willing to invest another $50 million in the company, to help finance Tesla's production facility. Now, Tesla is entering the mainstream market. Not only are the cars being sold, but also rented as well, giving people an opportunity to drive the car for a longer period of time than what a test-drive lasts. Since Teslas are available to rent, the company can attract more drivers, and perhaps tease enough of them to ultimately purchase one.

Tesla offers the cars: the Roadster, the Model X, and the Model S. Though the Model X can be only reserved at this point in time, the Roadster and the Model X are available. The largest obstacle Tesla faces now is the steep price of their vehicles. Though the company plans on developing a vehicle that will be sold in the $35,000 to $40,000 range, it would currently be their least expensive model. Tesla will need to take steps toward developing a vehicle that average consumers can afford. However, anyone who buys a Tesla receives a $7,500 federal tax credit as a reward of sorts for buying an electric car. In fact, if you buy an electric car from any auto-manufacturer, you are entitled to a tax credit up to $7,500. This is because the federal government incentivizes purchases of electric vehicles as a means of decreasing carbon emissions.

When you weigh the cost and the benefits of the Tesla, you should remember first and foremost that you will not need to put gas in it; the car is powered by lithium-ion batteries, and are kept at a safe temperature by a state-of-the-art cooling system. You should also know that it is also among the quietest, smoothest vehicles available, and because there is no combustion engine, a sedan can fit three rows and seven seats. That type of layout is usually only seen in minivans or sport utility vehicles. The reason it can be done with the Tesla is because it does not have a traditional combustible engine, leaving the space it usually occupies free to accommodate additional seating. And Tesla's departure from tradition is essentially its mantra: to build a line of vehicles that run on nothing but electricity, and to eventually accommodate the everyday person. Though the company has started out producing high-end vehicles only a small percentage of consumers can afford, Tesla's ultimate goal is to provide a vehicle that's affordable for at least 75 percent of consumers. Tesla is around to stay, and whether it retains its original name, or is used by other automaker, is of no importance. What is important though, is that the model has grabbed attention and gained traction – which is typically the first step before a product becomes a bull in the global web of commerce.