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Tesla Motors: Some Surprising Facts About the Company and its CEO, Elon Musk

Tesla Motors Inc – the world’s largest electric carmaker is earning annual revenues of over $3bn and a enjoys market value of over $33.5bn. In just fifteen years, since it was listed in 2010, its stock has increased in value by more than 1000%. The story of this American EV maker and its CEO Elon Musk is an incredible one and although most of us are familiar at least some of it, there’s a lot of misunderstanding and myth surrounding Tesla Motors.

Only Ford stock has been traded longer than Tesla

Tesla may be a relatively new company at 15 years old, but the company’s stock has been publicly traded for longer than any other US automaker, with the exception of Ford.  But what about GM? Yes, GM is much older than Tesla and it’s stock was traded on the New York Stock Exchange for decades but… the shares of GM you can buy today only became available about 4 months after Tesla went public in June of 2010. It’s a little confusing but GM went bankrupt in 2009 and the company was delisted from the New York Stock Exchange. Shares of the company’s stock became worthless at that point. GM came back to the markets in November of 2010. In this way, Tesla has been publicly traded 4 months longer than GM.

Tesla Motors Inc (TSLA) Factory Freemont, California

CEO Elon Musk didn’t start Tesla and his salary is only $1.

You may be be surprised to learn that Musk’s salary from Tesla is only $1 per year, yet his net worth is $12.1bn. It’s his risky investments that have made him rich and his net worth climbs and falls with the speed and force of a Falcon Rocket. Musk is a risk-taker at a level we rarely see in real life. He’s an “all-in” kind of guy who leaves little on the table – ever.

Elon Musk is the Chief Executive Officer of Tesla Motors, but contrary to popular belief he’s not its founder. In July 2003, the EV firm was incorporated by Marc Tarpenning and Martin Eberhard. It was Tarpenning and Everhard who financed the electric carmaker startup. In February 2004, using $7.5m from the sale of Paypal, Musk spearheaded the Series A round of investment, and joined the Board of Directors as Chairman. From that point on, Musk has been the controlling investor in the electric carmaker.

Those giant batteries used in Teslas can fit in your pocket

When most people imagine what the battery of an EV might look like they picture something big – really big. In most cases that would be true. Many EV makers use enormous, single-purpose battery cells. Tesla takes a different approach using 1000s of very small cylindrical, lithium-ion 18650-like battery cells like those used in laptop computers or other consumer electronic devices. The automaker uses a version of the batteries that is designed to weigh less than standard lithium cells by eliminating some safety features making them less expensive to produce. But these batteries aren’t cheap. Replacing an 85kw version of the battery will set you back over $40,000.

Tesla Motors Inc Battery

The batteries for the Model 3, X and S are located under the floor of the vehicles, unlike the Tesla Roadster, where the battery was placed behind the seats. Locating batteries under the floor, increases the risk of damage by impact or debris, but it also saves trunk space and interior space. The Model S sedan has a 0.25 in (6 mm) aluminum-alloy armor plate to secure and protect the battery.

The Tesla Roadster and Model S

Tesla’s first production car, the Roadster, was launched in 2008, and according to Musk, it was a disaster. The electric sports car was priced at $110,000 and only 2400 of them were sold. The mostly wealthy buyers were lucky that the cars were ever built and delivered. Once they were delivered in 2008 it was, according to Musk, “completely unsafe,” it “broke down all the time,” and it “didn’t really work.”

The Model S is the car that really put Tesla Motors on the path to become the worlds most successful and celebrated luxury EV.

Originally, the EV wasn’t even called the Model S – it was “Whitestar”. The Model S name was announced on June 30, 2008 in a press release. The Model S was the first electric car to receive the MotorTrends Car of the Year Award.

Tesla Motors Inc. (TSLA) Whitestar Model S

Tesla builds cars that are simple and easy to maintain. It’s hard to believe but only six parts on a Model S sedan need replacement regularly – the two wiper blades and the four tires.

The $35,000 Model 3 may be a myth

If you haven’t already placed a deposit on the Tesla Model 3 you might want to do that soon. The “affordable” EV is scheduled to be delivered in late 2017. Nearly 400,000 people have raised their hands (clutching $1000 bills) to say they want one. Tesla is notorious when it comes to delivery date projections vs actual deliveries. So far, Musk has been a little over-ambitious with his predictions.

The Model 3 will have a base price of $35,000 making it the most affordable Tesla so far. When you subtract federal and state incentives the price of the car could be as low as $27,000 making it a great deal.  It’s likely some people will get the car for this price but maybe not.

The earliest deliveries will be more expensive versions of the Model 3. Although Tesla is not following tradition by first releasing VERY expensive “Founders Editions” of the car, the early deliveries will be more fully equipped versions and they will be going to existing customers and employees. So if you own a Model S or X or if you work for Tesla, you’ll be getting your Model 3 before the most reservation holders. And, you’ll likely be paying way more than $35,000 for the car.

An added “ouch” to those who take delivery later is that they might not benefit from the legendary state and federal tax incentives as those will begin to go away in the next couple years.  So, that $27,000 Model S many are hoping for may not even be a possibility.

Tesla is changing the way we look at cars

Tesla is still young but the impact it is having on the auto industry and the way we look at cars and transportation is incredible. Elon Musk is a visionary on the level of Edison and Ford and we may only be seeing the tip of the iceberg when it comes to Musk innovation. You can read much, much more about Elon Musk and his world changing views here.

All trading carries risk. Views expressed are those of the writers only. Past performance is no guarantee of future results. The opinions expressed in this Site do not constitute investment advice and independent financial advice should be sought where appropriate. This website is free for you to use but we may receive commission from the companies we feature on this site.
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Aman is MBA (Finance) with an experience on both marketing and Finance side. He has work as a Risk Analyst for AIR Worldwide, and is currently leading VeRa FinServ, a Financial Research firm. Favorite pastimes include watching science fiction movies, playing PC games and cricket.

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