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General Electric Motors

Tesla has high hopes for its high-spec electric cars

FROM THE 1960s to the 1980s it was a General Motors plant. From then until 2010 it was used by GM and Toyota to make cars jointly. Now the giant carmaking factory at Fremont in Silicon Valley is in its third incarnation, as the manufacturing base of Tesla Motors, a maker of electric cars set up by Elon Musk, a founder of PayPal and of SpaceX, a rocket-maker.

Mr Musk is a man of big ideas. His long-term aim is to help colonise Mars and die peacefully there. His entry into carmaking, an industry that has been the graveyard of many ambitions, is almost as bold. Mr Musk set up Tesla to hasten what he sees as the motor industry’s inevitable switch to battery power. Having started with expensive sports cars, to be followed next year by an equally upmarket sport-utility vehicle, the plan is eventually to move to more mass-market models and become a sort of “General Electric Motors”.
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Tesla’s current car, the Model S, with prices starting at $52,400, has won rave reviews. Electric motors produce maximum torque from a standing start, which can mean great performance. Tesla has many fans, especially among Californian tech-loving early adopters. They are vocal in rebutting the carmaker’s doubters, who are also not hard to find.

So far Tesla is using only a quarter of the Fremont plant’s vast area. This year it plans to make just 20,000 cars as it concentrates on moving into profit. Mr Musk acquired the factory for $42m, far less than it would have cost to build, and bought lots of second-hand equipment.

Tesla is doing a lot of things differently from the mainstream carmakers. It produces many key parts in-house, from the battery packs to the slick touch-screen control panels. It is setting up a network of free fast-recharging points for its customers to top up their batteries on the road. It is battling America’s powerful car-dealership lobby so it can set up its own retail outlets. And it is aiming to get its products from the drawing-board to the assembly line at the speed of Silicon Valley tech firms rather than the statelier pace of Detroit’s car giants. Tesla’s manufacturing chief, Gilbert Passin, says the Model S moved from first design to production in just over two years, something he reckons would take a traditional carmaker five or six years.
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