Subscribe
In a highly anticipated initial public offering (IPO) of its stock, Tesla, a North American Silicon Valley based experimental auto manufacturer expects to raise $185 million. Toyota is also expected to purchase $50 million of the stock offering. GM hopes to compete with Toyota in the hybrid market with their Chevy Malibu Hybrid, Tahoe Hybrid, and Chevy Silverado Hybrid, which can be found at New Jersey Chevrolet dealers and other local dealers.
Tesla is currently the only auto manufacturer selling highway capable 100% electric vehicles in serial production. Other automakers are currently producing prototype 100% electric models, but the is anticipated delays before serial production of these models. Tesla currently produces approximately 15 cars per week.
Approximately 11.1 million shares will be offered in the IPO from between $14 to $16 per share. Tesla has produced over 1,000 Roadsters, a luxury battery powered sports car, and it will release its $50,000 Model S sedan in 2010 with full volume production. The Roadster retails for $109,000. The sales of shares will begin the week of June 28.
The IPO should help Tesla with its operating costs as Tesla has struggled since its inception with profitability. Tesla has also received funding from the government to offset their high research, operating, and production costs. It is also anticipated that Tesla may partner with Toyota in the near future to produce a new Toyota model that utilizes some of Tesla’s advanced battery technology.
Tesla has received funding from the United States Department of Energy for $465 million, but it has operated with a continual profit loss of around $300 million. Tesla reported $20.8 million in revenue and a net loss of $29.5 million for the first quarter of 2010. Tesla does not anticipate turning a profit until the 2012 release of the Model S sedan.
With the IPO funding, Tesla may be able to increase their profitability and production for the Roadster before the expected 2012 boost in sales from the S sedan.
