Next up for Tesla is the Model X, described as a "crossover" by auto industry types but somewhere between a minivan and a sport-utility truck for the uninitiated. That follows the progression of Tesla's business plan from a car produced in small numbers at a sky-high price (the Roadster) to cars produced in middling volumes and at a luxury price (the Model S and Model X SUV in 2014) to a car produced in large numbers at a lower price (a sedan forthcoming in 2017 or so, which is aiming for a cost around $30,000). Tesla also sells the electric power train it developed for the Model S to Toyota and Mercedes, a business that brought in nearly $4 million this year.
One key component of any price reduction will be drops in the cost of batteries, where Tesla has an advantage because it uses the same lithium ion cells used in the vast array of consumer electronics, where such batteries have also faced fire troubles occasionally. "There are billions of research dollars pouring into the space and also the infrastructure to manufacture cells," O'Connell says. Already, between 2008 and 2012, the cost per kilowatt-hour of lithium ion batteries dropped by half to roughly $500. That said, delivering the hundreds of thousands of batteries Tesla would need if successful at making tens of thousands of cars and battery packs may prove a challenge.
Tesla's latest idea is to design a battery pack that is swappable in 90 seconds, a kind of rapid recharging in the form of replacement, including quick disconnects for the battery’s liquid-cooling radiator system. Or customers can use Tesla's 23 supercharger stations to regain at least 240 kilometers of range in 20 minutes.
The software upgrade potential built into Teslas may allow them to escape the fate of their eerily similar predecessor from 1948: Tucker. Only 51 of those innovative cars were made in Chicago before that company folded. As it stands, Tesla may make and sell more than 20,000 Model S units this year alone. "There's a reason why everything we do is so hard," explained George Blankenship, Tesla's vice president of sales and ownership experience, at an event to extol the new car in New York City in November 2012. "It's because everything we do is impossible."
The best part of the Tesla experience remains cruising silently past gas stations touting fuel at $4 per gallon. That's a feeling founder Elon Musk himself hopes to experience during a planned cross-country road trip with his family this fall in his personal Model S, where the billionaire's children like to sit in the rear-facing third-row seats. The downside is that returning from the electric future to the gasoline past inspires a lead foot that burns through gasoline even faster.