Tesla Motors, maker of a high-end electric sports car, says it will build an all-electric sedan in Southern California. Thursday's announcement was made in Hawthorne, California, where Tesla unveiled the Model S sedan at a base price of $49,900, after a federal tax credit of $7,500.
That's less than half the price of its first model, the Roadster.
Started in 2003 and bankrolled by PayPal millionaire Elon Musk, Tesla has attracted investments from the Silicon Valley elite, among them Google founder Larry Page.
It is widely believed that the Model S sedan will be built near the Space Exploration Technologies Corporation facility in Hawthorne. That aerospace company, more commonly known as SpaceX, was founded by Musk in 2002.
SpaceX recently won a NASA contract to deliver cargo to the international space station when the space shuttle program is retired next year. That contract, worth $1.6 billion, was won over such industry mainstays as Boeing and Lockheed.
The promise of a high-performance, all-electric vehicle became a reality with the startup's first model, the Tesla Roadster, a car with the look, speed and price tag -- a steep $109,000 and up -- that rivals other high-end, high-performance vehicles.
Recently though, the economic downturn has forced Tesla to delay production of their would-be flagship Model S until 2011. They've also had to lay off more than 80 workers, which is about 25 percent of the company's staff.
Nonetheless, Tesla predicts it will manufacture 20,000 Model S vehicles a year. That would make it more of a mass-market vehicle than the Roadster; only 1,200 of which are produced yearly.
The company faces many challenges, the foremost of which is convincing consumers to pay almost $50,000 for an all-electric sedan when they could pay thousands less for another brand of upmarket sedan or a gas-electric hybrid.
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