Tesla Feels Credit Crunch

Add Tesla Motors to the list of car companies buffeted by the financial crisis.

The San Carlos-based maker of the all-electric, $109,000 Roadster said today that it was removing its chief executive, delaying production of its model S sedan, closing offices in Michigan and London and laying off an unspecified number of employees in response to a tight credit market.

According to Darryl Siri, Tesla's head of marketing and sales, the company will focus on cutting overhead on the Roadster. "The idea is that because of the fundraising environment and capital markets, we're going to focus on making the Roaster a positive cashflow core product."

Siri said that the number of layoffs has not been finalized, because it was unclear how many employees from its offices in Rochester Hills, Mich., and England would be absorbed into the Northern California headquarters.

The company's CEO, Ze'ev Drori, has been replaced by chairman Elon Musk, according to Siri and a blog item posted by Tesla on its site today. Drori was hired less than a year ago to fill the CEO job, but will remain as vice chairman of the company.

More news as it breaks on this story.

-- Ken Bensinger

The front of a Tesla Roadster is shown at a showroom in Menlo Park, Calif., last month. (AP Photo/Paul Sakuma)

Comments

[LPB]

Noooooo! Really?

I almost can't believe it.

[ferenc]

these are not americans, unless the usa is now part of israel.

[tomato]

It is not easy to be different. The problem is not everyone can afford the US100k automobile, while quality and reliability have not been proven beyond test drive by some journalists or auto mobile enthusiasts.

Also, have you considered outsourcing to China, India or other cheaper labor countries?

If assembling the car at $25.00 per hour per labor (Michigan Union rates - without calculating the admin labor), how many cars can you produce a day? Even so, at US$100k, how many cars can you sell a day?

[Jobless]

@ferenc

"have you considered outsourcing to China, India or other cheaper labor countries?"

This is one of the reasons we are in the trouble we are in today. If you pay someone in another country to build it, it is THEY who will have the money to buy things, not the unemployed citizen who lost his job due to outsourcing.

The answer is not outsourcing, rather downsizing in times like these.

[Bill]

Is this story a joke from 1984???Who the hell wants a 100K car these days?I want a 12K all-electric car,now thats the future!!

[Sunking]

WooHoo- Why don't you just email ridiculous articles like this to the 1,000 people in LA that can afford them- well, at least until those bailout checks clear. And save the space for writing about vehicles that matter for 98% of us- hybrid, electric, ect. I agree a 12K all electric car! Now that 2008!

[Jay]

Gee I thought Tesla was going to teach all those dumb car people how to build cars. I guess it's not so easy to design, engineer and build affordable, high quality, innovative cars is it? At first they wouldn't even talk with experienced engineers and designers because they thought they knew it all. Then they ran into all sorts of systems integration, body and mass issues that automotive people deal with everyday. I still laugh at their attitude. They'll be toast in a year and they'll wonder what happened.

[Daniel Klaus]

Can't keep a good idea bottled up too long. Oh, wait, unless your good idea is unachievable and a fantasy. Tesla's sales are probably great in Bel Air and La Jolla, but here in Watts....don't think so. Figure it out, America, Tesla doesn't want the dollars of regular Joe Sixpacks, regular Joe Plumbers. And they are no different from all the other automakers. Cadillac = good. Lexus = good. A 1994 Chevy Cavalier = you're a cheap-o. I really am sick and tired of being sick and tired. And now, with this snake oil company, they are putting people outta work in Michigan which could use every job they can get.