The year 2003 gave birth to a vehicle manufacturer that would change the course of history. Tesla was founded by two Silicon Valley engineers Marc Tarpenning and Martin Eberhard as a tribute to electrical engineer Nikola Tesla. Today, not only are Tesla vehicles popular across the globe but their leadership as well. Elon Musk has been the face of Tesla for several years and he continues to raise the standards by introducing newer technology every year.
This year saw the introduction of Tesla’s Cybertruck and the launch of satellite X. Both being tremendously major events, Tesla has many feathers in its cap. However, for the company to reach where it is today, it had to go through several complications and difficulties.
Let us take a closer look at Tesla and see how it manages to blow us away each time.
Birth of Tesla
As already mentioned, Tesla was founded by Marc Tarpenning and Martin Eberhard. Initially, the company’s name was Tesla Motors, which was later changed in 2017. The company was founded and is situated in San Carlos, California. Moreover, it was a tribute to Nikola Tesla who was fond of discovering the properties of electromagnetic fields. As Nikola continued his work on electromagnetic fields, he discovered ‘alternating current’. This form of electrical transmission was far more efficient than Thomas Edison’s ‘direct current’. Throughout his life, Tesla contributed both his time and effort to research and science. Today, if anyone were to recall Tesla’s history, it would not be possible without mentioning Nikola Tesla.
Initially, when Tesla was founded, Eberhard served as the CEO of the company, whereas Tarpenning took the role of CFO. The company decided to step foot into making electric cars as they had observed a positive response of the public to GM’s reaction tests. GM at the time wanted to introduce its fully electrical vehicle EV1. Although, GM ran the program for a short while from 1996-1999 and produced limited cars for the public but it never became a global phenomenon.
Observing the opportunity, both Eberhard and Terpening would build their success. While Tesla was going about its plans of introducing electric vehicles, Elon Musk jumped into the scene. He invested $30 million in Tesla and became the chairman of its board of directors. Later, Elon would use his superpowers to bring in several other investments and even raise money from Google.
Both Eberhard and Tarpenning were close to making their dream come true. In 2006, they had come up with the Tesla Roadster, which went into production in 2008. The car was a direct result of what the couple had dreamt of initially, which was to build an electric sports car. Previous experiments had failed since the company struggled to produce powerful batteries. The batteries had to be cost-effective yet ballistic in performance to provide customers what they had never experienced before.
The Tesla roadster met all those needs but at its unveiling, its price was set a bit over $100,000. This as a result drove many customers away. Moreover, another problem that popped up was its charging time. On a standard home outlet, it would take around 24 to 48 hours for the car to fully charge. Compared to its price, the charging time did not settle well with the customers and so the roadster soon fell on its knees.
Elon Musk takes over
In the year 2008, Tesla underwent several leadership changes. Eberhard resigned in 2007 as the CEO but remained a member of the advisory board. Ze’ev Drori then took permanent charge as the new CEO of Tesla. Drori is known to transform the Roadster from a prototype to a product that customers would consider purchasing. The very same year, Drori overlooked the successful launch of Tesla’s Roadster.
Soon, after the launch, both Eberhard and Tarpenning left the company.
Then, in October 2007, Elon Musk took over and the first thing he did was create a controversy by firing 25% of the company’s staff. Both Eberhard and Tarpenning sued Elon, stating that they were forced to exit the company. Furthermore, they explained that the blame for financial problems related to the Roadster was being unfairly put on them. However, Eberhard decided to drop his suit later.
Even though the Roadster had become a success by now, but it still faced serious financial troubles. At the time, the company only had $10 million cash in hand, which was not even enough to deliver the cars it had sold already. Then, Daimler AG jumped into the scene by purchasing 10% of the company’s stock for $50 million. Furthermore, the Department of Energy provided a loan of $465 million, which helped the company stand back on its feet.
The company, later on, was able to find out a solution to improve and enhance its short-term capital concerns by going public. In 2008, Tesla had planned to reduce the costs of its products. As a result, it came up with Model S, which was a $76,000 sedan. It was a huge success. The critics were in awe of the product and the customers had seemed to fall in love with it. Not only was the Model S a great option in terms of price but its range and built quality was top-notch as well. It went into production in 2012 and continued to receive several accolades and awards. The company then dropped its idea of introducing the Roadster and diverted its attention to producing sedans.
Since Tesla had successfully produced fully electric vehicles, it was time to introduce charging stations as well. The Superchargers were first installed in California and then expanded worldwide. The company was doing well by now and in 2013, it had announced a Gigafactory in Nevada, which will produce batteries for its devices. Tesla states that its vision is to become an energy solution company for different sectors.
The Model S was offered in two versions, the Model S Long Range Plus and the Model S Performance. Providing a range of 391 miles and 348 miles respectively, the Model S sold more than 50,000 units in 2016 alone. By 2018, Tesla had sold more than 250,000 units of Model S, which made it the second best selling electric car in history.
Model 3 was yet another huge success. The company had reserved orders accounting over $14 billion. Tesla Model 3 was unveiled in 2016 and by 2017, the company had around 500,000 reservations. In 2019, Model 3 overtook Model S to become the best selling electric car. Offering four trims to customers, the Model 3 remained in the spotlight for two consecutive years.
The Model X was a mid-size crossover SUV. In 2016, it became a top-selling electric car in Norway. Although the production underwent rescheduling several times but in 2017, it was estimated that Tesla had sold 46,535 units globally.
The Model Y followed Model 3. It was quite similar in appearance and performance as well. However, Tesla explained that it would be 10% bigger than the Model 3, which would increase its price by 10%. The car can seat up to 7 people with a range of around 300 miles.
Tesla continues to astonish the world with its innovations. With the introduction of the Roadster, Tesla Semi, and Cyber truck, the company is on its path of specializing in producing energy solutions for different sectors. Elon Musk’s vision and passion to produce the world’s best electric vehicles have helped the company achieve tremendous profits. Today, its stock price stands at $900, highlighting the rapid growth of the company.