Published on Fri Nov 11 2022
The History Of Car Manufacturer Tesla
Tesla has risen to such lengths in the automotive world through its electric-centric cars that everybody has to have come across the name at least once. The company’s name was given as a tribute to the famous physicist Nikolas Tesla.
Tesla was first formed in 2003 by Martin Eberhard and Marc Tarpenning and included other co-founders – Elon Musk, Ian Wright, and JB Straubel. It has been a decade since the company’s inception, and a lot has changed in these 10 years.
Tesla has made a multi-billionaire out of Elon Musk, making him the wealthiest man in the world, with a net worth of 219 billion dollars. He became the CEO of Tesla in 2008, and the company has grown even larger, since moving more into clean energy production and solar farms.
Tesla has also moved into the business of trading tax credits, using that capital to convert to profit, however, the company did not always find fortune in its initial years. Through this article, let us look at the history of this multi-million dollar company.
The Beginnings Of Tesla
Tesla was founded on July 1st, 2003, by two engineers who had a shared vision to manufacture cars in an alternative and sustainable way. The company was initially called Tesla Motors, and its logo was different from the one they use presently.
Eberhard and Tarpenning wanted to produce cars that were more comfortable to sit in and gave better mileage. They were inspired by the success achieved by General Motors, who would become their competitors in the future.
General Motors had massive success with their electric cars from the mid-90s to the start of the millennium. Tesla Motors took the help of private and venture financial investment to give themselves a good start.
The first major investor in Tesla Motors was Elon Musk, who contributed more than 30 million dollars and became the company’s chairman. This venture would see him become the wealthiest man in the world.
The Roadster was Tesla’s first electric car and it was produced in 2008. This car was the first of its kind, as it was wholly electric-powered, it could run for a distance of 394 kilometers on a single charge.
The ability of the car to travel almost 400 kilometers was the game changer for Tesla Motors. It was also incredibly fast for an electric car, reaching 200 kilometers per hour at top speed.
The founders were able to achieve their target of producing more sustainable cars as the Roadster did not give out emissions, and the car achieved efficiency levels equal to gasoline mileage of 57 kilometers per gallon.
The Roadster immediately impacted the automotive industry and became a luxury item, despite the price. Buyers had to pay a federal tax of almost 8000 dollars, but Tesla Motors still made a significant profit.
The two founders, Eberhard and Tarpenning, resigned from their positions in the company by 2008, however, they remained shareholders in Tesla Motors. The company was then taken over by Elon Musk, and has been serving as the Chief Executive Officer since.
Reviving The Company
Tesla was going through its worst financial situation ever by the end of 2008 and was ready to file for bankruptcy. However, Elon Musk secured a convertible debt financing of 40 million dollars.
The company’s board of directors did not sign the documents till the end of 2009 for the financing, putting the company in a dire state. However, Tesla was able to escape complete bankruptcy narrowly as the 40 million came through at last.
It helped them get through their worst situation since the company was founded, but Tesla still needed to get more investment in the company to advance its battery technology.
They managed to reel in Daimler to buy a 10% share in the company for 50 million dollars on May 19, 2009. This was a big step towards giving the company a stable source of investment.
Tesla Motors and Daimler worked together to create a battery and electric car system for future production. Daimler’s production, engineering, and supply chain expertise were the reasons Tesla joined up with them.
Along with Daimler’s investments of 50 million, Tesla Motors also took a loan from the US government of almost 470 million dollars.
Tesla went public in 2010 after a successful Initial Public Offering that raised 226 million dollars. This was invested back into the company, simultaneously, the company also started manufacturing works in their factory in California.
Producing New Car Models
Tesla gave fans a sneak peek into their productions for the future when they released a Model S prototype at an event in 2012. This car could go as fast as zero to sixty miles per hour in a matter of 4-5 seconds.
This car proved a point about the much-debated issue of how electric cars cannot perform like cars that run on gas. The Model S was the perfect example for Elon Musk to prove to people that electric cars can perform much better than conventional cars.
Tesla also manufactured a new crossover SUV, the first of its kind, it was called the Model X, and the most prominent feature was its Falcon Wing Doors. Even the advance sales for the Model X generated around 40 million dollars.
However, it wasn’t till 2015 that the company gave the green signal for production of Model X.
Tesla In The Present Day
Tesla has come a long way since it was founded in 2003 by Martin Eberhard and Marc Tarpenning. The company’s current market cap has risen to 963 billion dollars under the stewardship of Elon Musk.
Their share price has also seen massive growth in the past year, climbing as high as 1,234 dollars. This can be attributed to the company’s excellent earnings in 2021, and Hertz announced that it would purchase 10,000 Tesla cars for its rental car fleet.
The Tesla Model 3 is currently the 8th best-selling electric vehicle worldwide and is expected to enter the top 5 this year (2022). It is predicted that the Tesla Model 3 will outsell Ford’s F-150.