The company was founded in 2003 by two men named Martin Eberhard and Marc Tarpenning. The duo operated the fledgling company until the first major financing round of 7.5 million dollars, when Elon Musk was appointed Chairman of the Board of Directors. In February 2005, Musk led another round of financing to inject $13 million more into the company while developing the yet-announced Tesla Roadster.
Five months later, the company contracted Lotus to manufacture the Roadster– minus the powertrain which would become Tesla’s signature component. On July 19th, 2006 the Tesla Roadster was unveiled by CEO Martin Eberhard and chairman Elon Musk at an invite-only event. Tesla is officially a car company.
However, by the end of 2007, Tesla was in a tough spot. The company was burning through money and in need of new leadership. In December 2007, Ze’ev Drori, a successful high-tech entrepreneur and chief executive, became CEO and president. Under Drori’s leadership, 10% of the staff was laid off, but the company became profitable. Yet Drori stayed only a year at Tesla.
In October 2008, Musk succeeded Drori as CEO. By the end of the year Musk had dumped $70 million of his own money into Tesla. The company sold just 2,250 Roadster models between 2008 and 2012. Even that wasn’t easy– the company struggled to deliver orders on time while convincing potential buyers about its capability.
On June 30th, 2008, Tesla unveiled the Model S — the first car they’d really come to be known for. With a starting price of $50,000 and seating for seven, the Model S was supposed to be Tesla’s “affordable” family sedan. In May 2009, Tesla entered into a strategic partnership with Daimler AG, which acquired a 10% equity stake in Tesla for a reported $50 million (today, 10% of Tesla is worth billions).
In June 2009 Tesla took a $465 million loan from the United States Department of Energy. The company would pay off the loan in May 2013, nine years early. On June 29, 2010, Tesla raised $226 million in its IPO, becoming the first America car company to go public since Ford in 1956. The company unveiled its first SUV, the Model X, on February 9, 2012, with delivery expected for late 2013. The gullwing doors featured in the concept stunned audiences and will be included in the production vehicle.
The same year, Tesla quietly began building a small network of electric car charging stations throughout California. When the Superchargers were announced, there were only six stations operational. There are now over 200 worldwide, and routes that allow Model S drivers to drive from coast to coast in the US.
Tesla was picking up momentum in 2013 until three Model S sedans caught fire after crashing. No one was seriously injured and the company quickly fixed the issues — but not before its stock and public perception took a hit. Tesla’s stock price had dropped more than 20% over the course of the year.
Following a tough 2013, Tesla found its groove the next year. The stock price recovered, up 47% from the low point caused by the Model S fires. The company delivered its $28,500 Model S in July 2014 and charged forward with the introduction of new models. Tesla announced that it would be starting from the ground up to develop a significantly more affordable car, the Model 3, which would start at $35,000 before tax rebates. However, no concrete release date was given at the time. In addition, three new Model S are introduced in January 2015: the Model S 60D, 85D, and P85D. While they’re almost identical to the existing models, inside they are overcharged beasts.The dual motors let the P85D go 0-60 in 3.2 seconds. Meanwhile, the Model X was being delayed consistently. Tesla pushed the production start date to 2014 to focus on Model S deliveries, and then into 2015 so the company could put more effort into its debut in China.
In July 2015, Tesla made the P85D even faster via an over-the-air software update. The free update enabled the car’s “Insane” mode to go 0-60 time in 3.1 seconds. After weaker than expected sales in China, Tesla laid off hundreds in the country and replaced some of its regional executive team. One of Tesla’s biggest challenges is that over half of the United States do not allow car makers to sell cars directly, instead requiring them to sell through third-party dealerships. New Jersey began enforcing this law in March 2014. Tesla took legal action and it was overturned by NJ Governor Chris Christie almost exactly one year later. In May of 2015, the FTC throws its weight behind Tesla’s fight to sell directly to consumers. “A fundamental principle of competition is that consumers – not regulation – should determine what they buy and how they buy it,” writes the FCC.
Slowly but surely, the Model X gets closer to release. They start appearing, albeit slightly disguised, on the highways near Tesla HQ. Branching out from cars for the first time, Tesla unveiled a new business arm in April 2014 that focuses on transitioning the country to solar energy and ending our dependence on grid power. The first Tesla Energy product is the ‘Powerwall Home Battery’, a massive battery for storing solar energy at home.
In a crazy move, Tesla manages to make the P85D even faster. In July 2015, they introduced “Ludicrous” mode, shaving down the 0-60 time from 3.1 seconds to 2.8 seconds. However, the upgrade isn’t free this time. It requires new hardware that can handle higher voltages without melting, and costs $5,000 for existing P85D owners. With this upgrade, the P85D becomes one of the top 20 fastest-accelerating production cars in the world. Tesla addresses “range anxiety” with an update that constantly calculates your distance from a super charger. If there’s any chance you might get stranded, the car warns you… twice.
In something of a surprise move, Tesla announces that they will be reviving the Roadster line “in 4 years”. The Roadster was the first car the company ever made, but they ended its production in 2012 to focus on the more affordable Model S. After a few delays, the company announced in July 2015 that the aforementioned Model X SUV would ship “in 2 months”. Their more affordable compact car, the Model 3, meanwhile, will ship “in just over two years”, or 2017. Meanwhile, they continue to battle for the right to sell directly to consumers in most states.