3:50am

Sun November 18, 2012
Business

Tesla Revived The Electric Car, But Can It Sell It?

Originally published on Sun November 18, 2012 12:13 pm

The American auto industry has a new darling, but it doesn't come from the Big Three or even Motor City. Instead, it comes from the West Coast — Silicon Valley, to be precise.

Tesla Motors — the company formed by tech billionaire Elon Musk — has a new car, the Model S, and it's been named Automobile of the Year by Automobile Magazine and Car of the Year by Motor Trend.

Car geeks are typically a tough crowd to please, and with much of the electric car movement up to this point, the geeks have been kind of lukewarm.

"They're OK, they're nice, and they work and they do what they're supposed to do," says Joe DeMatio, deputy editor at Automobile Magazine. "But they don't really speak to the emotions of a car enthusiast."

DeMatio says the Model S is the first electric car that finally got the words right. He says they thought they would like it and that it would be an interesting technical exercise, but then they drove it.

"We were blown away by the performance and the power and the poise [and] the handling," he says.

For much of the electric car movement, there has been a kind of "eat your spinach" factor, but the Model S changes all that.

"By having the electric vehicle technology in a performance car, it makes people think about electric vehicles in a whole different way," says Roland Hwang with the Natural Resources Defense Council. "Instead of thinking of them ... as some sort of sacrifice, what customers can now start to see is that electric vehicles have tremendous potential."

Potential, however, doesn't always equal car sales.

Michelle Krebs with the automotive website Edmunds.com says success in the auto industry for Tesla, or any car company, isn't just about one good car, it takes a string of them. That, of course, takes money — a lot of it.

"Well it's billions; so there's constant investment," Krebs says. "You can't just get a check, make a car and expect that that's going to carry the day. You've got to still keep investing for the future."

Now that Tesla has made a car that auto enthusiasts love, DeMatio says the real challenge is to see if the non-car geeks of the world will buy one.

"The ultimate success is sometimes built on other successes that people have had," he says. "So even if Tesla doesn't survive long-term, they've achieved something, they've proven that something can be done, and someone else could pick up that mantle."

DeMatio says while Tesla hasn't proven that it can sell cars, what it has proven is that it won't be the last electric car company.

The new Tesla Model S starts at $50,000 — after a $7,500 tax credit.

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Transcript

RACHEL MARTIN, HOST:

The American auto industry has a new darling. Don't think Motor City - think West Coast, Silicon Valley. And forget internal combustion - this new car is all electric. Tesla Motors, the company formed by Tech Billionaire Elon Musk, has been racking up awards with the new Model S. Automobile magazine calls the Model S the automobile of the year and Motor Trend says Tesla is their car of the year. NPR's Sonari Glinton has more.

SONARI GLINTON, BYLINE: Car geeks are a tough crowd to please. They've seen, driven it, talked trash about it. And with much of the electric car movement, they've been kind of meh.

JOE DEMATIO: You know, they're OK. They're nice and they work they do what they're supposed to do, but they don't really speak to the emotions of a car enthusiast.

GLINTON: Joe DeMatio is an editor of Automobile magazine. With a $7,500 tax credit, the new Tesla Model S starts at about 50 grand. DeMatio says the Model S is first electric car that really speaks to car geeks. I mean, automotive enthusiasts.

DEMATIO: I think we thought we would like it and it would be an interesting technical exercise and it was, you know, kind of cool looking. But then we drove it and we were blown away by the performance and the power and the poise and the handling.

GLINTON: He keeps going for a while, but that's the thing. For much of the electric car movement there's been a kind of eat your spinach factor. Roland Hwang is with the Natural Resources Defense Council.

ROLAND HWANG: By having the electric vehicle technology in a performance car, it makes people think about electric vehicles in a whole different way. Instead of them thinking about it as limited range or slow vehicles or some sort of sacrifice, what customers can now start to see is that electric vehicles have tremendous potential.

GLINTON: But potential doesn't necessarily equal car sales. Michelle Krebs is with the automotive website Edmunds.com. She say success in the auto industry for Tesla or any car company isn't just one good car, it takes a string of them. And that takes money - a lot of it.

MICHELLE KREBS: Well, it's billions. So, there's constant investment. It can't be just like, you can't just get a check, make a car and expect that that's going to carry the day. You've got to still keep investing for the future.

GLINTON: Now that Tesla has made a car that auto enthusiasts love, Joe DeMatio says the real challenge is to see if the non-car geeks of the world will buy it.

DEMATIO: The ultimate success is sometimes built on other successes that people have had. So, even if Tesla doesn't survive long-term, they've achieved something and they've proven that something can be done and someone else could pick up that mantle.

GLINTON: DeMatio says while Tesla hasn't proven that it can sell cars, it has proven that it won't be the last electric car company. Sonari Glinton, NPR News.

(SOUNDBITE OF MUSIC)

MARTIN: This is NPR News. Transcript provided by NPR, Copyright NPR.