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Tesla Motors Opens Michigan Tech Center; Focus on Upcoming Electric Sports Sedan

25 January 2007

Tesla Motors, manufacturers of high performance, zero emission electric vehicles (earlier post), has opened its Michigan Technical Center in Rochester Hills.

The 19,240 square-foot facility will focus on R&D for future Tesla products to follow the introduction later this year of the Roadster, starting with a four-door electric sports sedan to be built by the Silicon Valley-based company. That project, named “WhiteStar,” will be a four-door, five-passenger, lightweight, high-performance sedan planned for production around 2009.

This tech center will be home to the engineering, quality and supply chain staff working on WhiteStar and other Tesla cars coming down the line. With our state-of-the-art CAD and CAE design and simulation tools, this center will enable us to bring high-quality products to market quicker than traditional manufacturers.

—John Thomas, general manager of the Michigan Technical Center and senior director of the WhiteStar program

The region’s existing base of automotive companies, facilities and engineering talent, also figured into the decision to place the Technical Center in Michigan.

There are thousands of highly experienced automotive experts in this area. We felt it was smart to use the existing test tracks, validation equipment, wind tunnels and more, rather than duplicating these costly investments.

—John Thomas

Since opening in July 2003, Tesla Motors has grown to a company with more than 140 employees as they prepare to launch their first electric car, the Tesla Roadster, in the fourth quarter of 2007. More than 270 customers have already reserved a Tesla Roadster in advance. Over time, Tesla Motors plans to develop a wide range of electric vehicles, all sharing the common characteristics of great styling, high performance, zero emissions and zero oil usage.

The Michigan Technical Center will be the fourth Tesla Motors facility worldwide, and the second in the US, joining the company’s headquarters in San Carlos, Calif. Tesla Motors also has facilities in England (assembly of the Tesla Roadster) and Taiwan (motor production).

January 25, 2007 in Electric (Battery) | Permalink | Comments (47) | TrackBack (0)

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GO, Tesla, GO!!!!!!

This company is currently the bright star in a heaven of dull glowing auto companies just talking about doing something. Tesla actually is producing plug-ins while the others slowly crank up, unwilling to take a chance on a reduction of their bottom line.

I just hope Tesla doesn't sell out to the big guys and can survive against the pressure they will most assuredly exert to drive them out of business.

Let's just hope they manage to keep the UAW out of their manufacturing plant. For all the good the union has done its members, it has forced auto industry managers to pursue product strategies that have proven not only detrimental to the environment (specifically, the climate) but also perilous to the balance sheets in times of high oil prices.

I hope Tesla can pull a rabbit out of its hat. The approach of adding a lot of value to high-quality but otherwise commodity Li-ion cells through innovative packaging makes a great deal of sense. It was also smart of them to focus on a roadster first, because the drivetrain differentiation matters a great deal there.

What's going to be much more difficult is dealing with all the other engineering effort that has to go into a full-featured performance sedan, especially if it is to be produced in any meaningful volume (at least tens of thousands a year). It will be much, much harder to deliver competitive differentiation in that vehicle segment.

Perhaps they are not-so-secretly hoping that one of the majors will bite the bullet and license their IP or, buy them outright. If the EU decides to enact per-manufacturer targets for fleet average CO2 emissions, several German carmakers may decide they need to invest in PHEV/BEV technology to stay in business.

The UAW is not to blame for US auto industry mistakes and stupidity. Big Three management around 1950 decided against funding portable pensions and single-payer healthcare for their employees; not to mention their chronic lack of vision in product lines.

Drivetrain differentiation seemed to help the 2nd generation Prius (a four door, five passenger sedan) considerably; why not Tesla?

I would expect an alliance with Ford. Daimler is too proud and not hurting enough.

I went on the Tesla website about a week ago, and found an interview with Elon Musk from the show "Wired Science". It was pretty interesting, the guy has his fingers in a lot of different projects. At any rate, Elon said that the Roadster is considered as a "Phase 1" for their company. Phase 2 is the 4 door all-electric sedan spoken of above. He estimates this vehicle will run in the 40-50 grand bracket. He then went on to say that they hope to bring out a Phase 3 vehicle similar to the Phase 2, except in the 30 grand bracket. I'm anxious to see these upcoming additions as I have been thinking a long time, someone should make a mass market, All-Electric, a model with universal appeal like a Camry or Accord. The EV-1 was ground breaking, but not quite where it needed to be in terms of mass market appeal. I hope their Roadster works without any serious glitches.

By the way, about that UAW stuff. It might interest folks to know that Toyota makes lots of cars here in the US using UAW workers, here's an example:

"New United Motor Manufacturing, Inc. is an automobile manufacturing plant in Fremont, California. The factory was an old General Motors plant and is now a joint venture between GM and Toyota. When it reopened for production in 1984, it was the first automotive joint venture plant in the United States. GM saw this joint venture as an opportunity to learn about Lean Manufacturing from the Japanese company, while Toyota gained its first manufacturing base in North America and a chance to implement its production system in an American labour environment.

NUMMI is now an award-winning facility which ranks with other Toyota plants among the most productive manufacturing operations in North America. Unfortunately whilst the plant has been successful in adopting Lean, GM's success is far more limited. GM places around 12 managers each year at the plant to learn lean techniques and has improved quality enough across the rest of its operations for it to show through on J.D. Power quality rankings. However Kochan, Lansbury & MacDuffie in "After Lean Production" state that "the NUMMI story is well known, so it will suffice to say that GM did a terrible job of learning from that experience."

Currently, the NUMMI plant produces the Toyota Corolla compact car, Toyota Tacoma pickup truck and the Pontiac Vibe station wagon. In the past, it has also produced the Geo Prizm, the later Chevrolet Prizm, and the Chevrolet Nova from 1984-1988; as well as the Toyota Voltz, the Japanese right-hand drive version of the Pontiac Vibe - both are based on the Toyota Matrix, which is manufactured in Cambridge, Ontario, Canada. Employment is nearly 5,500 workers. NUMMI is a union organization represented by The International Union, United Automobile, Aerospace and Agricultural Implement Workers of America (UAW) Local 2244. NUMMI sells 60% of their parts to Toyota and 40% to General Motors. NUMMI has 160 robots to build the three cars they do today."

The problem is not the UAW, the problem is that the GM and Ford bean counters got caught flat-footed when high gas prices ended the SUV gravy train.

Tesla Motors has the energy and vision that GM and Ford lack.

Richard -

it may be true that the Big Three made decisions in the 1950s that seemed like a good idea at the time but have since become boat anchors for the entire US auto industry. The UAW has contributed to the problem by insisting that this 1950s model be continued to the present day, almost regardless of the competitive environment.

And even if the UAW is not directly involved in product roadmap decisions (unlike in Germany, for example), it's insistence on generous benefits has forced US carmakers to concentrate their efforts on relatively simple, cheap-to-build trucks and SUVs in favor of competitive passenger cars, because the margins on those are lower. This lack of diversity in their product line-ups at a time of rapidly changing fuel prices and customer expectations, combined with those generous benefits, has ended up costing tens of thousands of manufacturing jobs and a lot of shareholder value.

This is not to say that management hasn't been arrogant or made mistakes in the past. Just don't discount the impact of union contracts that the US auto industry can really no longer afford the way it did in the last century.

It is not like UAW is not a big drug (it is), but companies like Caterpillar, Cummings, Oshkosh, Mack, etc. somehow manage to be profitable and grow at considerable rate.

In an earlier post someone asserted that Telsa was the wave of the future because they were so "un-detroit" by being based in California. By opening a tech center in Michigan, are they now still "un-detroit", and to be still considered the savior of our personal transport vehicles?

I do like what I see, but until they offer something in the $14,000-$22,000 price range, they are way out of my market. Of course that offering would also have to be acompanied with an offer of 60-84 month financing, and a 10 year/100,000 mile warranty. But being electric, it should easily last that long. Until then, it will be only a novely loved by the Jay Lenos and George Clooneys of the world, along with their other 268 "financially sound" potential buyers.

Dont get me wrong, I firmly believe BEV are our future. Its just that the required economical batteries and fuel cells have not been deliverered, yet. I applaud Tesla for being the trailblazer in these efforts. Perhaps they could go a long way creating an alliance with a company such as Ford, benefiting both. Would not be a terrible thing in my view.

If capitalist progress requires that ordinary Americans like me must sacrifice our standard of living to keep the real citizens of the US, the corporations, Wall Street Bubble-worthy, then what exactly is the point of capitalism or progress?

The only reason starving Americans in the 1930s didn't launch a revolution to overthrow their cruel, oblivious Bush-like masters is that FDR cut a deal with the masters to assure citizens of a certain baseline of decency, and a share in the future benefits of "progress". We bought in. As soon as the Bush generation of masters came of age they decided to reverse everything and exploit media control, debt and the oil-based suburban lifestyle to keep us passive while they stole all the wealth created after WW2 thru privatization, Fed-rigged bubbles, and finally fraudulent wars. The fatcats now tell us we must sacrifice, little by little, all the freedoms our poor ancestors fought for, and all the economic benefits as well, or they'll collapse and take us all with them.

Or maybe you think if car workers' wages get driven down to 1920s levels that their bosses will somehow redistribute their bounty to the rest of us. That's not how labor markets work. If auto workers get pay cuts, either they will leave the industry, or there are no better jobs elsewhere because all wages are falling. Which they are (as opposed to salaries). Whenever anyone attacks wage earners, they imply that they aren't real Americans, or necessary Americans, and must be sacrificed to the "good", red-state Americans with salaried jobs manufacturing nothing but lies and addictions. And it's left vague when this sacrifice will end (like the war). This isn't progress, it's running the clock backward to the nightmare of Victorian social Darwinism.

super390:

That's quite the rant, there.

Phase 2 $40-50k, phase 3 $30k will not priced way out of the market, especially when operating (fuel) costs for ICEs are climbing only slightly slower than CO2 concentrations.

Hello fellows BEV aficionados,

I also applaud Tesla for what they are doing and yet I agree with staying out of Michigan altogether, would look much better in my book. By the way, with a plant[?] of only less than 20K sq-fts I strongly doubt that they would be able to manufafacture anything there...perhaps it is going to be just a tech/R&D Center, but than again, why not stay in sunny California??? Oh well, they might be attracted to the cold weather or something else in Michigan.

By the way, as I previously posted on this site there's a new up-and-coming BEV company which for what I heard they are going to blow away both Tesla and Phoenix due to the fact that they own their proprietary battery technology as well as because the production plant is apparently somewhere south of the border in order to keeo the cost of production as low as possible. Also, my friend who's brother works there told me that they have already sold several hundred BEVs to governments sout of the border whcih helps them to finance at least a part of their ops as well as testing the vehicles before they land on US soil. Smart move...I think.

And, last but not least, they are coming out with 5 BEV models as well as a couple of small vans/busses all at once raning from a small [Scion xA/Mercedes A Type] car, to a cool sedan, a SUV/SUT and a couple of great looking coupe/spiders. I heard their price range will start from the low $15K and up...

I was promised to preview the updated design/models and I can't wait for that day which should be soon!

I'll keep you all informed as soon as I have news.

Fred "BEV" Sands PhD

By the way,

Sorry for all the typos...too much coffee in my blood today!

FS

Come on Fred, you have to give us more than that. What is this company's name? Can a company with no name really blow away both Tesla and Phoenix, or are they "skunkwork" type secret? There are no surprises in todays automotive market.

Also, what does super390's rant have to do with Tesla or this post?

super390:

You could always move to one of those workers paradises like Cuba or Venezuela, but your rants point to someone who's just looking for a whittle attention.

1) Super390; Right on Brother!
2) Why can't the Grovenment push "pariotism" in reducing and eliminating fossil fuels?
3) Fred can dream and talk about what he knows, but in the end, the small startup BEV companies do not have a chance against the big car companies. The best case that ever will happen is to be a "brand" for a big company.

Rochester Hills, MI, is home to ECD/Ovonics, co-owner of Cobasys (located near-by), which is integrator of own Ni-Mh and A123 Li-ion batteries into electric vehicle packages, for example for GM.

Conspiracy theory junkies, any one to comment?

super390's rant was in answer to a gratuitous swipe at the UAW. I suppose none of that really belongs in a discussion of the Tesla.

JD,

super390's only mistake was to not respond by name to Rafael Seidl. The same goes for richard schumacher and Sumyung Guy. Rafael provides no evidence for his indictment of the UAW. I thought that super390's retort was refreshing.

I don't believe for a minute that the sucess of the Japanese auto industry is due to holding down wages and benefits. I'd say that their success is due to the efficiency of a country with nationalized health care, better education, cultural homogeneity and a cooperative government that emphasized product export, plus a lean corporate management that emphasizes efficiency and competition, plus a large engineering staff that emphasizes precision and flexibility.

The Japanese factories in the states still have the significant management and engineering advantages, plus they employ a relatively younger workforce. From these factories, there are far fewer retirees with heavy health care costs. The Japanese name plates now carry the cache (in the affordable car classes) that used to belong to GM, Ford, and Daimler/Chrysler. This fact alone will do them in if something radical doesn't happen soon.

JC et al -

my point was simply that unions tend to hang on to their past "achievements" way past their sell-by date. Not every company with UAW employees was as foolish as the Big Three in offering overly generous benefits. That's precisely why they are now profitable. It is also a big reason why the Big Three are hurting. Ford just posted a $12 billion loss, and Chrysler will have to do bleed once again before the can get the kind of relief that GM and Ford have already received.

Btw, US unions are hardly alone in exploiting their negotiating position to the detriment of shareholders and ultimately, employees. Witness the bribery contortions VW has been going through to keep the IG Metall compliant, their former head of HR was convicted just today. Chairman of the board Ferdinand Piech, who is actually close to the union, admitted that VW has approx. 30% more hourly workers on its German payroll than it needs and has done so for decades. Small wonder the average age of the assembly line workforce is 46 and rising.

In the 1960s, GM employed a substantial fraction of the total workforce in the United States. They were also a similar fraction of total GDP, and at one point the government threatened to break them up as a monopoly. The UAW demanded, and got, a very generous healthcare and pension package for their retirees.

The fact is that these benefits, especially in healthcare, cost GM well over a billion dollars per year by themselves. The company has something like a million retirees. Why do you think they've been so aggressive in renegotiating these contracts? Fact is that GM lost, and continues to lose, billions.

Hell, Ford lost $12.7 billion last year and they're not as big as GM is.

Both GM and Ford have lost more and more market share. Add to these problems some major increases in the price of raw materials (steel and copper in particular), not just oil prices, along with diminishing marketshare, and something has to give. Either the UAW accepts lower benefits or both companies simply go bankrupt, and then none of them have jobs.

I get my info from a close friend who is a GM line worker and has been for over twenty years. He's also been deeply involved with UAW politics. He's also fingered GM corporate culture as a major cause of their current troubles.

Fred:

What you described seems to be very similar to what is happening in China ...... not exactly south of the USA border.

The Chinese market will be flooded with a multitude of low cost BEVs very shortly. Some of those Chinese BEVs (e-bikes) are selling very well (5 to 8 million/year) in Asia and North America. Three and four wheel models, from 2 to 10 passengers, will be out within a few months for those of us who can't afford American made Telsa, Phoenix, etc.

Walmart is currently selling the 2-wheel models and may be selling the 3 and 4-wheel models within a year or two unless Big Oil and Big Three lobbies manage to convince the Federal Administration to find various ways to curtail or even ban BEVs import.

How about an electric heavy-duty truck? Most heavy duty diesels already run about 50k so Tesla could easily sell an electric for about 60k. That would make one of the Big Three notice them.

Electric motors do have loads of torque.

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