Follow the Money

That’s exactly what Tesla Motors is trying to do. This local upstart automaker is producing (very) high-end electric vehicles for the rich and green in Silicon Valley. They have recently opened their second dealership (the first being in SoCal), on the border of Menlo Park and Palo Alto at 300 El Camino Real, a place that has become death row to four dealerships in the last decade.

The Tesla Roadster is their first production vehicle and began rolling off the line in July. This sporty little car is 100% electric, burns no oil, and gets 244 miles per charge, not to mention it can make 0 to 60 in 3.9 seconds! Currently a waiting list of 1200 for this little gem, which is selling for $109,000 (base price). Obviously the economy can’t be hurting too much…at least for some.

Tesla is the one car that is headquartered, designed, and will be produced locally. Tesla’s home base is in San Carlos, but they made the decision to mass produce their cars in San Jose. The new state-of-the art plant, to be located off Zanker Road and Highway 237, will pour $250,000,000 into the local economy in construction costs, and will house the assembly plant, corporate headquarters and their R&D campus. Construction begins next summer and when completed will employ 1,000 local workers.

The Tesla S, their 5-passenger luxury sedan, will follow as the second car in production. Once the San Jose plant is up and running, they expect 15,000 vehicles to roll off the line per year, starting in 2010. The Tesla S will run on a lithium-ion battery pack and be priced around $60,000, a bit more affordable in the scheme of things, not to mention it will hold a family and groceries.

One thing Tesla has done right, trumping mortgage lenders, is requiring a $5000 initial deposit to lock in price, and an additional $55,000 before production begins. That’s a 55% total down payment, significantly more than recent home loans.